Group 3 Members:

1. Nguyễn Tấn Đạt - 21DH480468

2. Lê Thị Ngọc Khánh- 21DH483700
3. Nguyễn Thị Kiều Ngân- 21DH485033
4. Nguyễn Hoàng Trúc Chi -21DH489314
5. Võ Minh Phát -21DH481982
6. Nguyễn Bùi Thu Trang- 21DH485256
7. Nguyễn Tuấn Khanh - 21DH483694

Shein’s supply chain is both responsive and efficient.

The main principles are micro batching, close supplier relationships, and data
utilization for better decisions.
This is called Small order, quick response.

‘Free on ‘Original
board’suppliers desgin’suppliers

5 – 10 days

 Shein's supply chain net work begins with exchanges between Shein's Internal
buyers and Suppliers. Shein does not use their own designers but they have
'Free on board' supplier and 'Original design' supplier. These are 2 different
types of suppliers:
- FOB Supplier (about 500 people) uses designs that are not their own but come
from influencers that the company is collaborating with
- OD Supplier (about 20,000 to 30,000 people) and they operate by sending
images of designs to Shein's internal buyers. If these designs are approved, the
supplier sends samples and if these samples are approved, they receive a production
order.
- If an order is approved, the quantity is usually very small, between 50 and 100
pieces. This is called by Small order.
- Shein launched approximately 5,000 to 8,000 stock keeping units (SKUs). Shein
shares data with these suppliers to help them make smarter decisions about
everything – including raw materials, design and manufacturing capabilities.
 This process takes 5 - 10 days to go from the drawing board to the shipping
container. Why Shein’s supply chain so responsive ?

Safety Stock of
15 – 20 days
inventory

Order low quantity and

Micro batching
sell out within the day

Close supplier Half of the clothing

Shein responsiveness relationships and supply supply base is in
base Guangzhou

Manufacturing Raw materials, Factory

execution system data, Product life cycle
(MES) management

Demand forecasting
Moniter user
method
  Safety Stock of inventory
-Shein uses 15 to 20 days of safety stock of inventory, whereas most of the industry
is at 3x to 6x of this figure at 90-plus days.
 Micro batching
-As Shein tests offerings at low production volumes, a product can sell out in a day.
This isn't a problem when you can have more to ship within five days. Then on the
next production run, a supplier can produce 10,000 pieces because they have the
data to support it.
-This also leaves almost no risk of being stuck with bad inventory, which means
rarely having to destroy clothing.
 Close supplier relationships and supply base
-Half of the entire clothing supplier base in Guangzhou (one of the production
capitals of the more than 400,000 clothing factories in China) is dedicated to Shein
alone. This includes thousands upon thousands of factories of all sizes, most of
which are locked out of work with other fashion companies.
-Facilities with supply centers are no more than 5 hours away.
 Manufacturing execution system (MES)
-Shein built its own manufacturing execution system (MES) that records all raw
material and factory data as well as manages the production life cycle.
 Moniter user
-Shein is known for its collection and use of data throughout its customer
experience and supply chain. The company is known for analyzing information like
user browsing behavior, scraping data on trending styles from social media, and
more. Not only do you need to collect data, but you also need to process it and use
it to make smarter decisions. Let’s consider the following model :
-The method of predicting customer needs means monitoring customer purchasing
behavior and then adjusting output and production speed accordingly.
In addition, they can record the number of customers who view the item's
information, add to the shopping cart, and purchase the product. The algorithm will
then suggest customers of the same age, interests, and country.