Report: Shein and Temu Fight Two-Front Battle for Fast-Fashion Market

Earlier this month, Chinese fast-fashion brand Temu sued rival Shein, accusing it of “intimidation.”

That suit followed an earlier one filed in federal court in March in which Shein accused Temu of copyright and trade violations.

But behind these court battles, The Wall Street Journal (WSJ)  reported Sunday (July 30), there’s a less public front to this war happening in China, where a bulk of the two companies’ offices and supply chains are based.

According to the WSJ, Shein and Temu are battling for workers and suppliers and requiring long hours in a bid to conquer the prize U.S. fast-fashion market.

The report says Shein has been on a hiring spree and expanding supply-chain and logistics infrastructure, and — per sources familiar with the matter — has considered hiring a leader for its U.S. operations.

Meanwhile, Chinese Shein workers past and present told the WSJ that Temu had “poached aggressively” from Shein last year, particularly from the company’s supply-chain and operations departments.

Temu parent PDD had 13,000 employees at the end of last year, while Shein had more than 11,000. Users on the Chinese employment site Maimai say Shein has offered financial incentives to work longer hours and requires some workers to log at least 242 hours monthly.

PYMNTS has reached out to both companies for comment but has not yet received a reply.

Temu filed a federal antitrust suit in U.S. District Court in Massachusetts on July 14 accusing Shein of trying to hurt its business.

“Shein has engaged in a campaign of threats, intimidation, false assertions of infringement, and attempts to impose baseless punitive fines and has forced exclusive dealing arrangements on clothing manufacturers,” says the Temu complaint.

The suit accuses Shein of using its dominant position in the U.S. fast-fashion market to force suppliers in China into exclusive relationships, thus depriving consumers in the U.S. of access to competitive prices and hampering Temu’s sales.

“For a long time, we have exercised significant restraint and refrained from pursuing legal actions,” Temu said in a statement provided to PYMNTS.

“However, Shein’s escalating attacks leave us no choice but to take legal measures to defend our rights and the rights of those merchants doing business on Temu, as well as the consumers’ rights to a wide variety of affordable products.”

“We believe this lawsuit is without merit and we will vigorously defend ourselves,” a Shein spokesperson told PYMNTS.