Chinese fast-fashion company Shein is set to acquire Everlane, the US-based retailer known for its commitment to ethically sourced and sustainable clothing. The deal was confirmed in a letter to Everlane employees from CEO Alfred Chang, obtained by the Associated Press on Friday.
Deal Details and Background
Everlane did not disclose the purchase price, and Shein declined to comment. Everlane was founded in 2011 by Michael Preysman and Jesse Farmer with a mission to produce eco-friendly and affordable clothing. The company gained recognition for its transparent audits of pay, working conditions, and environmental impact, and it opened its first physical store in 2017.
Recent Controversies and Financial Struggles
In recent years, Everlane has faced controversies regarding worker treatment, according to media reports. L Catterton, a private equity firm, began acquiring significant stakes in September 2020, becoming the majority owner. It also holds stakes in brands like Boll + Branch, Etro, and Birkenstock. Preysman stepped down as CEO in 2022.
Chang, who became CEO in 2024, wrote in the letter: “Like many brands, we’ve faced increasing pressure in a rapidly changing retail landscape. This partnership allows us to remain independent, and gives us the stability and resources to make a larger impact, without compromising on the quality and standards that make Everlane, Everlane.”
Implications of the Acquisition
The takeover comes as Everlane struggles with declining sales and mounting debt, according to Neil Saunders, managing director of GlobalData Retail. He noted that the company needs new ownership to survive, and Shein can provide financial stability. For Shein, the acquisition offers a pathway to establish a presence outside of fast fashion, as growth in that sector becomes more challenging due to tariffs and trade restrictions under the Trump administration.
However, Saunders described Everlane and Shein as an “odd couple.” He suggested that while Shein is unlikely to completely overhaul Everlane’s supply network, the association with the Shein group may be “somewhat jarring for core Everlane customers.” He concluded: “Ultimately, the deal likely saves Everlane, but that salvation comes at a price.”
