In the past few years, Shein and Temu have exploded in popularity among teens and young adults. These apps, known for their ultra-low prices, sales and in many cases free shipping, are often the center of attention on social media sites like TikTok, with networks of paid influencers showing off massive hauls. 

Even before the two apps were popular, other platforms like Wish and AliExpress held significant popularity worldwide, with similar models of low prices undercutting major retailers. 

Behind these low prices, however, is a pattern of unethical activity, including forced labor and unethical working conditions, human rights violations, stealing designs, counterfeiting and stealing consumers’ data. These activities come in addition to the various environmental and health issues that are caused by the consumerist culture these companies market and profit from.

HOW THESE COMPANIES OPERATE

To understand how these companies are participating in these types of unethical activities, it is important to understand where they came from and why they are so popular today. Shein, originally founded in 2011 as a wedding dress website, rose to popularity in 2020 on the back of the pandemic-induced e-commerce boom. 

Temu, founded by Chinese parent company Pinduoduo in 2022, quickly came into popularity after its founding and is currently the top free app on both the App Store and Play Store. Much of the success of these websites is because of two factors: marketing and pricing. 

A significant portion of Shein and Temu’s marketing comes from the virality of the “haul” video on TikTok, where influencers show off large packages of products, which are usually excessive and almost always for commission. Many of these influencers are paid by the companies and get the products for free, along with flat fees and shares of profits from influencer-specific referral codes. 

Additionally, both websites have programs where friends can invite each other for bonuses, including coupons and credits for the websites. These types of promotions, in many cases, mean that some of the already-cheap products on their websites can become free bonuses for people who manage to convince their friends to use their referral code, or vice versa.

The main appeal of the companies, however, is not their marketing — it’s their prices. To keep prices low, Shein uses an algorithm to predict trends and order small amounts of clothing, only producing more when the items sell out. Temu’s low prices come as a result of some less futuristic strategies — from its inception, Temu’s owners lost a significant amount of money on every order as a way of expanding their market in the United States, a strategy similar to what parent company Pinduoduo used when it came into business. 

Along with this, Temu’s supply chain relies largely on the same suppliers that Pinduoduo uses that connects their suppliers directly to consumers instead of holding any stock. In addition to these, both companies benefit greatly from the de minimis tariff exception, which excludes consumer packages worth under $800 from tariffs — Temu and Shein are thought to be the source of up to one-third of shipments excluded under this rule.

SLAVERY AND LABOR RIGHTS VIOLATIONS

Their streamlined business models and use of tariff loopholes are not the only ways Shein and Temu can maintain low prices. Forced labor is one way costs are kept low — both platforms’ suppliers have connections to forced labor and ethnic repression.

A congressional report from 2021 described how Shein skirted import regulations against Chinese government-sponsored slave labor in the Xinjiang Autonomous region, where minority Uygher workers are held against their will with little-to-no communication with their families to produce products including (but not limited to) textiles, yarn and hair products. 

These workers are often taken outside of the region to work in factories as well, being forced to live and work in fenced-in factories with prison-like conditions and even having their identifying documents confiscated to make it nearly impossible to leave successfully. Another congressional investigation reported that Temu fails to ensure that their network of tens of thousands of suppliers aren’t using forced labor, admitting that they only make their suppliers agree to “boilerplate terms and conditions” while avoiding responsibility for using forced labor. 

These boilerplate contracts haven’t done much to prevent unethical activity though — a Los Angeles Times report said that Tel Aviv based firm Ultra Information Solutions claimed to have found multiple products on Temu being sold by companies based in Xinjiang, and that the platform obscures the sellers’ links to the region or the origin of their products. 

Forced labor isn’t the only unethical activity these companies engage in to keep costs low. An investigation by researchers from Swiss watchdog group Public Eye described unsafe working conditions, including barred windows, floors blocked by bags full of finished products and a lack of emergency exits and stairwells. The workers inside of these factories, many of whom had migrated from rural China, described illegally working 75-hour weeks without contracts or benefits, and often being paid per-item at a slowly-decreasing rate. Similarly poor conditions exist at American-owned warehouses that Shein uses for distribution. 

COPYRIGHT VIOLATIONS

Another large part of the popularity of Temu and Shein is their ability to keep up with trends much faster than both traditional clothing stores and fast fashion retailers. One lawsuit filed in July alleges that Shein and its suppliers stole designs from individual designers across the U.S. to the point that it constituted racketeering, and other indie fashion businesses across the globe have reported having their designs copied by Shein. 

Temu’s parent company has in recent years gotten scrutiny from both Chinese and American authorities for selling counterfeit products, and its Chinese sister platform Pinduoduo is on the Office of the United States Trade Representative’s list of notorious markets for counterfeiting and piracy because of its widespread failure to combat copyright infringement or help investigate cases of counterfeiting. 

Pinduoduo has also previously faced lawsuits in the U.S. for selling counterfeit goods on their platform. These lawsuits appear to have proved ineffective, however — by opening Temu’s front page in an incognito tab, there were multiple listings of fake Apple and Nintendo products, unlicensed merchandise of brands like Sanrio and even a counterfeit 1891 collector’s coin. 

CONSUMER PROTECTION ISSUES

On top of this long track record of problems, Temu and Shein both have issues with protecting the data of consumers. In addition to the required data needed by the platform to ship packages, Temu collects a trove of additional data based on your browsing activity. According to a CBS report, Temu scrapes data including social media photos, birthdates and even social security numbers, along with a significant amount of data about your personal devices, as a way to build files on consumers. This data, according to the report, is insecure due to its connection with Chinese-owned Temu. A Chinese law put into place in July could compel Chinese workers for the platform to turn over data to their government. Shein has also had problems with securing data before. The company was fined in 2022 for mishandling a 2018 data breach of 39 million customers’ login credentials both by failing to notify a majority of those affected that the breach happened and publicly lying about the number affected.

ENVIRONMENTAL PROBLEMS

One of the most significant problems that directly affect Shein and Temu’s consumers is the health and environmental issues caused by the company, their products, and even the consumerist fast fashion culture that the companies perpetuate. Millions of tons of clothing waste are produced in the West because of the fast fashion trend, and that number is likely to increase significantly if Shein’s popularity continues. 

Most of this clothing waste ends up in landfills, many in third-world countries, and the low-quality synthetic fabrics Shein’s clothes often use can’t be processed in recycling systems. In Accra, Ghana, where the Kamanto market gets 15 million secondhand clothing items weekly, merchants who would previously buy bales of secondhand clothing to reuse and recycle now complain of good quality clothes being replaced with “trash,” which they blame on overproduction and wasteful use of clothing. The waste isn’t the only risk, either — their products have been found to contain toxic chemicals such as lead, phthalates and PFAS, which not only has risks to the environment but to consumers themselves. 

This far-reaching combination of labor issues, copyright violations, consumer protection failures and environmental problems mean that there are significant ethical issues with shopping on these platforms. With products from Shein hitting the shelves of popular stores like Forever 21, and Temu continuing its reign at the top of both major app stores in the U.S., it is important to consider the ethical implications of buying products from these brands and any similar platforms that may come into popularity in the future.