Shein Harnesses Street Vendors for Growth in Mexico

With nearly 50 million people living in poverty, Mexico's fashion market is experiencing a significant shift driven by Shein, offering fashion items priced as low as MX$99 (US$6). By tapping into Mexico's extensive network of street vendors, Shein has gained substantial traction in the country, boasting over 1 million partners who sell its merchandise through various channels, including WhatsApp.

The emergence of Shein has disrupted established retailers like Liverpool, once a leader in online clothing retailers but now relegated to sixth place. Shein's aggressive marketing tactics and discounted offerings have reshaped consumer preferences, particularly in the plus-size segment and during cultural events like the Day of the Dead.

In response to Shein's competitive challenge, retailers like Liverpool and Coppel are overhauling their strategies, focusing on online promotions, and introducing new financing options for lower-income consumers. Even Walmart Mexico and Central America (Walmex) is ramping up discounts through its Cashi shopping app to maintain competitiveness.

However, Cuidado Con El Perro, a rapidly growing fashion chain, poses a threat to Shein's dominance. Targeting budget-conscious Millennials and Gen Z shoppers, Cuidado Con El Perro offers affordable unisex merchandise and attracts consumers with capsule collections inspired by popular culture.

Despite Shein's rapid expansion, concerns persist regarding fraud scandals and consumer distrust, particularly related to its payment system and promotional activities like the Lucky Flip Game. Moreover, Mexican consumers remain cautious about online shopping due to issues such as credit card fraud and identity theft.