Shein has said that the company is experiencing strong growth in the face of increased US tariffs on exports from China.

On 1 February, President Donald Trump announced the elimination of the de minimis rule for Chinese imports, with an executive order to impose a 10 per cent tariff on all Chinese imports.

The de minimis rule is a trade policy that has allowed duty-free entry of imported goods below a certain threshold, typically $800 in the United States. This policy allows packages of small value to enter the country without customs duties or extensive inspections.

On Monday, the executive chairman at Shein, Donald Tang reassured its investors in a letter seen by Reuters, confirming it will keep its position in a “fiercely competitive environment for discount apparel in the US”.

"As I am writing this note to you, despite the recent challenges, our growth remains strong, driven by our ability to offer a diverse selection of fashion and lifestyle products at consistently affordable prices," wrote Tang, according to a report by the news agency.

The letter went on to say that Shein is currently investing in supply chain advancements to boost efficiency and responsiveness and better logistics to provide faster deliveries.

According to Reuters, the letter did not report any financial information.

The elimination of the de minimis rule was put on hold by the Trump administration itself on 7 February due to logistical issues, as the impending implementation of the rule had caused delays in customer orders due to parcels piling up at airports.

The Trump administration has stated that the pause will allow federal agencies to adjust to the new policies but has not yet confirmed further timelines on the process.

Analysts at RBC Capital Markets warned that the removal of the de minimis exemption poses a significant threat to Shein's business model and could force price increases.

According to a US congressional report, Shein and its rival Temu account for more than 30 per cent of US shipments under these exemptions.

In his letter, Tang confirmed his advocacy towards the new rule.

"I have long advocated for de minimis reform that prioritises American consumers, because at Shein, our focus is on customers, not customs policy," he wrote.

Earlier this month, the Financial Times said that the fast fashion retailer was likely to delay its London stock market debut until the second half of 2024, following Donald Trump's move to end tariff exemptions on low-cost Chinese imports to the US.

The valuation for the initial public offering (IPO) is now expected to be cut to around $50 billion, nearly 25 per cent lower than its $66 billion valuation during its last funding round in 2023.

The retailer, which filed confidential papers with UK regulators in June last year, is still awaiting regulatory approval in both the UK and China. The company would also need a special waiver from the UK Financial Conduct Authority if it plans to list less than 10 per cent of its shares.

In response to the tariff changes, Bloomberg recently said that Shein is expanding its production base in Vietnam, offering Chinese suppliers temporary incentives including up to a 30 per cent increase in procurement prices to facilitate the shift in production outside China.

The European Union is also set to introduce sweeping reforms that would make major e-commerce platforms like Temu, Shein and Amazon Marketplace legally liable for dangerous or illegal products sold through their sites, particularly targeting the surge in imports from China.

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