If you don’t know what Shein is, that might be because you’re not a broke female college student or (also broke) fashionista. Then again, it also might be because you missed the big news that the company is officially going public this coming week.

Shein is a China-based company that offers “fast fashion”: cheap, low-quality clothing that nonetheless looks trendy. You might not be able to wear it more than a few times before it falls apart, but that’s okay with Shein’s customers.

They just buy something else at similarly low prices.

The company has been aggressively expanding outside of China for about 10 years now, with significant customer bases in the U.S., Europe, Australia, Russia, and the Middle East. In fact, it’s such a global success that it’s been talking about an initial public offering (IPO) for years now.

Shein first filed for a U.S. IPO in November 2023, only to back off after Congress pushed back on charges that it utilizes slave labor. And though London was less discriminating the following June, the Chinese powers that be stepped in to make that effort fall through as well.

None of this tempered Shein’s enthusiasm, mind you; but its valuation has dropped along the way. In 2022, private fundraising rounds put it at $98.2 billion. In 2023 and 2024, that figure fell to $64 billion.

Now, it looks like Shein is setting its own valuation at $27 billion at most on the Hong Kong stock exchange.

The final price will be announced on August 31, the day before its IPO. But it looks like the fast-fashion retailer is selling about 280 million class B shares at somewhere between HK$47.60 and HK$49.50.

We’ll see who buys and at what price on Tuesday.

Is it a bird? Is it a plane? It’s… Amazon!

Last Saturday, I reported how Amazon (AMZN) is expanding its drone delivery service:

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We’re still exceptionally used to – even expectant of – seeing Prime-emblazoned trucks and vans driving along highways and down our streets to deliver goods the usual way. And that will doubtlessly stay the norm for years to come.

All the same, Amazon just announced that its drone delivery services will expand to almost 500 U.S. cities by the end of the year. The long list includes Atlanta, Georgia; Chicago, Illinois; Cleveland, Ohio; and Boise, Idaho – though far away from town centers with towering office buildings.

As I added, deliveries will basically be limited to the suburbs and by weight. Apparently though, it should also be limited to places that don’t have pools.

That’s what Lindsey Austen in Richmond, Texas, learned earlier this week when she ordered dry cat food and some insoles for her daughter’s shoes. Amazon sent her a prompt notification to expect them in 20 minutes through the Prime Air drone service. So she went outside to film their arrival.

And what an arrival it was, as the package was plopped right into her expensive-looking pool.

Obviously, Amazon will have to work on that.

Critics also say it has to work on noise pollution, as residents near drone-operating facilities aren’t happy with the incessant buzzing sounds they make. Moreover, these drones feature such powerful propellers that they’ve blown their five-pound-or-less deliveries right into the street at times.

There’s always room for improvement, they say; and Amazon is proving that point right now quite clearly.

Get your tech “cheap” while you can

Speaking of Amazon…

The e-tail behemoth just raised prices on its Fire TVs, Echo smart speakers, Kindle tablets, and Eero Wi-Fi mesh router systems. And when I say “raised,” I mean by a lot.

Take its Echo Dot, which was $49.99 earlier this month. As of last weekend, it’s now $79.99.

Told you it was by a lot.

Amazon’s explanation, solicited by TechCrunch, was that:

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The consumer electronics industry is facing significant increases in memory and storage component costs. After absorbing these increases for as long as we could, we recently adjusted pricing across our product lines.

If that’s true, I think Amazon chose the wrong strategy. Much better to raise prices a little at a time rather than add $30 at once. That’s a great way to irritate customers and lose business – an obvious truth a company as smart and capable as this one should recognize.

With that said, the situation does serve as a stark example of how bad the global memory shortage has become. As AI needs push supply to their literal limit, every other chip-dependent product becomes more difficult and expensive to assemble.

Laptops are now selling for 15.8%–19.3% more than they were in February 2023, when the AI craze was still in its early stages. And smartphone prices are up 15%–20%.

Don’t expect those prices to get any better next year either. The global chip issue probably won’t peak until late 2027 at the earliest, with the shortage stabilizing – maybe – in 2028.

So if you need new tech, now’s the time to act. It’s not likely to get any cheaper for a while.

Happy SWAN investing!

Brad Thomas
Editor, The Wide Moat Daily