The YM fund aims to create wealth for its stakeholders by carefully selecting sustainable investments with long-term promise in future prosperity ...
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Your
Mission
Pension Fund
The YM fund aims to create wealth for its stakeholders by carefully selecting
sustainable investments with long-term promise in future prosperity.
Jasper Rijnders Maximilian Meinicke Jin-Kyu Noack Karla Meschkat
Group A3 https://youtu.be/hxA5E-VQBjc
Introducing The Fund
01 Briefly highlighting the values of the Your Mission Pension
Fund, and how these manifest in investment criteria
AGENDA 2
02
Analysis Of Shein And The Industry
Evaluating the feasibility of an investment into Shein and the
fast fashion industry based on financial and CSR analysis
3
03
Investment Proposal
Identifying companies that match Your Mission Pension
Fund’s values and make a sustainable long-term investment
Introducing The Fund
01 Briefly highlighting the values of the Your Mission Pension
Fund, and how these manifest in investment criteria
Introducing
The Fund
2
02
Analysis Of Shein And The Industry
Evaluating the feasibility of an investment into Shein and the
fast fashion industry based on financial and CSR analysis
3
03
Investment Proposal
Identifying companies that match Your Mission Pension
Fund’s values and make a sustainable long-term investment
The YM Fund Invests Into Accountability, Stability, and Prosperity
Our Identity
State Employee Retiremend Fund | Several Billion Dollar Portfolio
Accountability
Investment Criteria
The Fund Places An Emphasis On CSR Perfromance To
Ensure The Maximum Return On Its Investments Sustainable Reliable
IDEAL
INVESTMENT
Our Values
Prosperity Stability
Accountability Ethical Conduct And Transparency
Growth
Stability Low-Risk No Scandals
Prosperity Financial Growth
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
4
Your Mission’s Values Translate Into A Three Step Investment
Evaluation Process…
Summary
Accountability
Industry At A Glance Financial Analysis
Assessment
Materials
Companies Are Required To Share Certain Disclosures To Allow The YM Fund To Perform
A Wholistic Evaluation Of The Firm And Determine An Investment Decision
Market Evaluation Yields Extensive Investigating Key Financial Figures Of Identifying CSR Practices Shows
Investment
Outcomes
Knowledge Of Business Environment Companies Reveals Top Performers Dedication To Creating Impact
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
5
…Composed of A Three Pillar Financial Analysis And A Six Pillar
Accountability Assessment
Financial Analysis Accountability Assessment
The “Remake Accountability Assessment” Criteria Provide
Growth Revenue CAGR A Credible CSR Evaluation Framework
Return On Assets
Volatility Standard Deviation
Traceability / Sourcing Of Raw Commercial Practices In
Transparence Materials The Company
Beta Analysis
Liquidity Debt-to-Equity
Wages / Environmental Justice & Governance, Diversity &
Current Ratio Well-Being Climate Change Inclusion
Key Takeaway
Conducting A Variety Of Analyses Creates A Comprehensive View Of A Company
And Ensures Both A Sustainable And Profitable Investment
Sources: Remake (2021)
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
6
Necessary Disclosures
1 2
Financial CSR
Income Statement | Market Valuation Annual Report | Employee Records
Balance Sheet Supply Chain Disclosures
Purpose
Ratio Calculation | Remake Accountability Score Determination | Financial Evaluation
Introducing The Fund
01 Briefly highlighting the values of the Your Mission Pension
Fund, and how these manifest in investment criteria
Shein And
The Industry 2
02
Analysis Of Shein And The Industry
Evaluating the feasibility of an investment into Shein and the
fast fashion industry based on financial and CSR analysis
3
03
Investment Proposal
Identifying companies that match Your Mission Pension
Fund’s values and make a sustainable long-term investment
THE FAST FASHION
INDUSTRY
“…cheap, trendy clothing that is based on styles
copied from the catwalk and celebrity culture and
brought to market at breakneck speed”
The Dynamic Market Environment Creates An Uncertain Future For
The Fast Fashion Industry
An Overview Of The Fast Fashion Industry
China-US Tensions Highly More Environmental E-commerce ~6% Growth Few Legal
Affect Clothing Supply Polluting Consciousness Popular Projected in 3yrs Restrictions
Key Statistics
Of People Spend Less On Annual Growth Rate Of nd Most Polluting
60% Fashion Since Pandemic 10% Fashion E-commerce 2 Industry In The World
Current Trends Future Implications
1 Increasing Pressure For Firms To Be Environmentally
and Socially Responsible
2 Supply Chain Uncertainties Following COVID-19
and Political Tensions
Change
The Fast-Fashion
Model Must Adapt
Feasibility
Tensions And Supply
Issues May Make
Decline
Market Growth Is
Projected To
3
To Match Consumer Chinese Import Decline In the next
People Are Purchasing Less Clothes And Value First- Demand Unattractive 10 years
hand Less
Appendix 1
Sources: McKinsey (2022), FashionUnited (2019), O.S.U. (2021), Eco-Sylist (2021) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
10Shein Is One Of The Largest Players In The Fast Fashion Industry But
Scores Below Average On Transparency
100
90 Insights
Score on Fashion Transparency Index
80
Shein Scores Worst In
70
Transparency
60
Rank Average In Revenue
50 Among Big Players
40 Shein Doesn’t Operate
Similarly To Clusters
30
20
Shein’s Transparency
10 Score: 1
0
0 5 10 15 20 25
Revenue 2019 in $Bln
Key Takeaway
The Stand-Alone Position of Shein in the Fast Fashion Industry Requires further Investigation
Sources: Fashion Revolution (2021), Yahoo Finance (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
11Shein Is One Of The Largest Players In The Fast Fashion Industry But
Scores Below Average On Transparency
100
90 Insights
Score on Fashion Transparency Index
80
Shein Scores Worst In
70
Transparency
60
Rank Average In Revenue
50 Among Big Players
40 Shein Doesn’t Operate
Similarly To Clusters
30
20
Shein’s Transparency
10 Score: 1
0
0 5 10 15 20 25
Revenue 2019 in $Bln
Key Takeaway
The Stand-Alone Position of Shein in the Fast Fashion Industry Requires further Investigation
Sources: Fashion Revolution (2021), Yahoo Finance (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
12Shein’s Public Statements Suggest CSR Is Paramount To The
Company’s Operations…
Shein Mission: “To serve as a leader in the industry and bring fashion into the modern era.”
An Overview Of Shein
Targeting Young People, Cheapest Clothes Exclusively Originally Private
Specifically Gen-Z On The Market E-commerce Chinese Company
”Our People” “Our Products / Our Planet”
Sustainable Practices
Batch Production | Green Technology | Workflow Optimization
Fair Labor Our Family Fair Pay for all
Ethical Sourcing
Campaigning Against Priorities On Healthy Payment Of Living Usage Of Faux Fur & Leather | No Animal Testing
Unethical Practices Work Environment Wages
Explicit Prohibition Of Employees Treated With Healthy Insurance &
Child Labor “Respect” Investment Plans
Recycling Program
Exchange Of Unwanted Clothes For Shein Giftcards
Supply Chain Code Of Conduct
Working hours must be compliant with Suppliers are prohibited from hiring Supplier Partners must pay wages on time Supplier Partners must provide a safe,
local laws and regulations minors under the age of 16 and comply with the local minimum wage hygienic and healthy workplace
Sources: Shein Sustainability (2021), Shein (2021) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
13…However, Shein’s Actions Contradict Their Supposed Priorities
Media Reports on Shein’s Reality
“Making Our World Unlivable” “Gen-Z, Shein is Using You”
Euronews article headline exposing Journalist Amy Buxton highlights the
Shein’s wasteful operations and dangers of Shein’s low prices and
unethical practices social media influence
“The Least Transparent Company” “Shein NEEDS To Be Cancelled”
Chinese reporter Wu Peiyue recalls a Eco-Stylist uncovers Shein’s
visit to an unregistered sweatshop in unethical practices including 75 hour
Guangzhou, making Shein clothing work weeks and the use of
chemicals
Key Takeaway
The Divisive Media Agrees: Shein Does Not Operate In An Ethical Or Sustainable Manner
Sources: EuroNews (2021), GreenQueen (2022),
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
SixthTone (2021), Eco-Sylist (2021)
14Shein’s Accountability Score Reflects The Dismal True Nature Of Its
Practices
Remake Accountability Assessment Score Main Criticisms
No Public Supply No Initiative To Use Environmental
Chain Information Sustainable Alternatives Pollution
Human Rights Lack Of Impact On Cultural
Violations Local Communities Insensitivity
Total Score: 5/150
Key Takeaway
Sheins’s Operations contradict customer and market demand for sustainable and responsible fashion
Appendix 2
Sources: Remake Fashion Accountability Report (2021) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
15Shein’s Lack Of Transparency Opposes A Potential Investment
Shein‘s Financial Analysis Is Based On Poor Assumptions… …Because Of The Lack Of Transparency from the Company
Annual Growth Rate
For the past 7 years 1 Financial documents are not published and a
general lack of openness and transparency make
financial estimates unreliable
Daily Active Users
Generating 10,000
2 Employees are banned from media contact, and
have had their social media monitored
orders every day
Revenue
Estimated in 2020
3 Some estimates claim profits are as low as
$300Mln, and it is not certain that the company is
profitable
Key Takeaway
Estimated numbers suggest extreme growth, but prevalent uncertainty eliminates the appeal of a potential investment
Appendix 3
Sources: Forbes (2021) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
16Accountability
“YM Pension Fund Sustainable Reliable
Would Not Invest IDEAL
INVESTMENT
In Shein” Prosperity
Growth
StabilityShein’s Stand-Alone Position and Shortcomings Regarding
Transparency Call For A Broader Look At The Market
100
90 Insights
Score on Fashion Transparency Index
80
Four main segments
70
Large number of small
60 players
50 Most having little revenue
compared to the industry
40
30 Transparency issue
throughout the industry
20
Inconclusive Initial
10 Impression
0
0 5 10 15 20 25
Revenue 2019 in $Bln
Key Takeaway
H&M Group, Fast Retailing and Zalando SE represent important clusters and require a closer investment evaluation
Sources: Fashion Revolution (2021), Yahoo Finance (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
18Shein’s Stand-Alone Position and Shortcomings Regarding
Transparency Call For A Broader Look At The Market
100
90 Insights
Score on Fashion Transparency Index
80
Four main segments
70
Large number of small
60 players
50 Most having little revenue
compared to the industry
40
30 Transparency issue
throughout the industry
20
Inconclusive Initial
10 Impression
0
0 5 10 15 20 25
Revenue 2019 in $Bln
Key Takeaway
H&M Group, Fast Retailing and Zalando SE represent important clusters and require a closer investment evaluation
Sources: Fashion Revolution (2021), Yahoo Finance (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
19Media Reports Reveal Common Industry Practices Are No Better
Than Those Of Shein
Media Reports On Fast Fashion
“Fast fashion speeding toward “Death, Injury and Health in the
environmental disaster” Fashion Industry”
Estimated 1.4 mil injuries in FF
Increasing pollution threatens industry workplaces each year (5.6
ecosystems around the world per 100 workers)
“One Of The Biggest Contributors
“(Un)fair fashion and human rights”
To Modern Slavery”
Amnesty International offers classes
GSI: over$125 Bil of fashion
to discuss human right violation
garments crested via modern
“throughout the whole fast fashion
slavery
industry”
Key Takeaway
The Fast Fashion Industry Is Responsible For A Big Part Of Pollution And Violation Of Human Rights
Sources: The Guardian (2021), Amnesty International (2020),
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
OC Common Objective (2018), Essence (2019)
20An Evaluation Of Accountability Scores Highlights The
Malpractices That Are Standard In The Industry
Wages and Environmental
COMPANY Traceability Raw Material Commercial Governance TOTAL
Well-being Justice
1/8 0/23 2/20 1/15 8/42 6/42 18/150
5/8 3/23 5/20 3/15 13/42 10/42 39/150
0/8 0/23 5/20 0/15 0/42 0/42 5/150
4/8 5/23 2/20 1/15 8/42 4/42 24/150
Key Takeaway
No Company Scored More Than 26% Of Total Available Points
Appendix 2&3
Sources: Remake Sustainability Report 2021
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
21Poor CSR Performances Are A Risk For Investments As They
Adversely Affect Company Valuations
Deepwater Horizon Oil Spill 2010 H&M Racism Scandal January 2018 Boohoo Wage Scandal 2021
“A Sunday Times investigation found that
“BP faces backlash over Gulf oil spill report” “H&M slammed as racist for ‘monkey in the workers (…) were being paid as little as
– BBC jungle’ hoodie” – CNBC 3.50£ (4.37 dollars) an hour” – Business
Insider
59% Drop In Share Price 13% Drop In Share Price 18% Drop In Share Price
Environmental Social Governance
~ $56 Bln Costs 19k Retweets In 24hrs £500 Mln Value Loss
Sources: BBC News 2010, CNBC 2018, Business Insider (2021)
Yahoo Finance (2021)
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
22Industry-Wide Financial Stability Indicates A Potential Investment
Opportunity…
Financial Analysis Financial Analysis
Criteria and Tools Implications
Revenue
-1,39% 0,03% 15,48% 100% The Covid-19 Pandemic shows
CAGR negative impact on Revenue Growth in
Growth
the Fast Fashion Industry
Return on 8,2% 7,7% 3,44% N/A
Assets
Standard
Deviation 16,81 10,29 8,93 N/A The Volatility Analysis indicates
Volatility especially H&M Group being a high-
risk Investment
Beta Analysis 1,21 0,87 1,04 N/A
Debt to Equity 111,12 65,91 72,37 N/A The Fashion Industry indicates little
Liquidity Liquidity concerns, however, Fast
Retailing might not use their assets
Current Ratio 1,29 2,98 1,64 N/A most efficiently
Sources: Yahoo Finance (2022), Investing.com (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
23On The Surface Fast Fashion Industry Appears Attractive, But Is
Blemished By CSR Malpractices
Financials
Investment In Fast Fashion May Seem Appealing
Due To High Growth And Convincing Sales
Figures…
CSR
…However, The Unsustainable CSR Practices In The
Industry Present Hidden Obstacles That Could
Trigger Future Scandals With Severe Negative
Financial Impacts.
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
24Accountability
“Thus, An Investment
In The Fast Fashion Sustainable
IDEAL
Reliable
Industry Will Not Be Prosperity
INVESTMENT
Stability
Considered.” GrowthIntroducing The Fund
01 Briefly highlighting the values of the Your Mission Pension
Fund, and how these manifest in investment criteria
Investment
Proposal 02
Analysis Of Shein And The Industry
Evaluating the feasibility of an investment into Shein and the
fast fashion industry based on financial and CSR analysis
Investment Proposal
03 Identifying companies that match Your Mission Pension
Fund’s values and make a sustainable long-term investmentCurrent Market Trends Show That Investment Opportunities Might
Exist In The Boarder Apparel Industry
The Majority Of Customers Customers Are Increasingly Implications
Trend
Customer Preferences Prioritize
Would Boycott A Company For Shifting Focus To Sustainable
Quality
Poor Business Practices Environmental Practices
Investment Must Display
Fundamental Values Of
% Of Customers Willing To % Of Customers Who Prefer Ethical Practices
% Of US Adults Who Say
Boycott Businesses Climate Should Be Top Priority High Quality Products
80% Investment Must Reflect YM’s
60% Priority Of Environmentally
Evidence
Responsible Behavior
40%
90% 20% 64%
67% 71% 63% 57% YM Must Consider Investment
0% Candidates That Supply High
Gen Z Millenial Gen X Boomer
Quality Products
& Older
Resale Industry Lifestyle Apparel Industry Textile Industry
Contributes To Circular Focussed on producing Stable Industry Delivering High
Economy And Sustainable Sustainable High Quality Quality Goods Whilst Moving
Clothing Practices Clothing With A Long Lifetime Towards Sustainability
Appendix 4
Sources: USA Today (2021), PewResearch (2020), Fashion Network (2018) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
27Triple V Investments
Second Hand Apparel Lifestyle Apparel Industry Indian Textile Industry
Vinted VF Corporation Vardhman Textiles
The biggest player in the The global conglomerate India’s Second Largest Textile
growing second-hand resale operates in a growth market Producer Has Achieved
industry acts according to and places emphasis on Numerous Rewards In
sustainable and ethical Environmental Social Corporate Social
standards Governance Responsibility
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
28Triple V Investments
Second Hand Apparel Lifestyle Apparel Industry Indian Textile Industry
Vinted VF Corporation Vardhman Textiles
The biggest player in the The global conglomerate India’s Second Largest Textile
growing second-hand resale operates in a growth market Producer Has Achieved
industry acts according to and places emphasis on Numerous Rewards In
sustainable and ethical Environmental Social Corporate Social
standards Governance Responsibility
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
29The Sustainable Nature Of The Second Hand Resale Industry
Accomodates The Changing Customer Demands
Key Characteristics Of Second Hand Resale Industry
No Producers, Just Focus on Reusing Limited Waste Generally Increasingly
Platforms For Purchasing And Sustainability And Pollution Low Priced Popular
Important Statistics
Higher Growth Expected Growth Rate Bigger Than Fast
11x Than Traditional Retail
20% In The Next 5 Years
2x Fashion By 2030
Key Players
CSR
Purchasing Second Hand With the lack of a producer,
Clothing Reduces One’s the resale industry ensures
Carbon Footprint By no workers are exploited in
Approximately 80% the process
Sources: Harpers Bazaar (2021), Green With Less (2020), Bordeaux Business (2020) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
30Vinted’s Promotion Of The Cicular Economy And Proven Business
Model Ensure Alignment With YM’s Values
Mission Statement
VINTED
“Our mission is to make second-hand the first choice worldwide by helping people connect with
one another so they can sell or buy pre-loved clothes”
Corporate Social Responsibility
Clothing Resale Platform
45 Million Users
90 Clothing Pieces Uploaded
Per Minute
No Seller’s Fee Circular Economy Transparency
Main Users: Young Europeans
To promote the growth Platform helps provide Throughout the company
of the second-hand users with money through ensures high employee
market reusing reviews
$4.5 Bln Valuation
Sources: Vinted (2021), 360-Entrepeneur (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
31Triple V Investments
Second Hand Apparel Lifestyle Apparel Industry Indian Textile Industry
Vinted VF Corporation Vardhman Textiles
The biggest player in the The global conglomerate India’s Second Largest Textile
growing second-hand resale operates in a growth market Producer Has Achieved
industry acts according to and places emphasis on Numerous Rewards In
sustainable and ethical Environmental Social Corporate Social
standards Governance Responsibility
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
32The Lifestyle Apparel Industry Differentiates Itself Through Its Close
Customer Proximity And High Growth Potential
Key Characteristics Of Lifestyle Apparel Industry
Higher But Still Creative Input Strong communication Good Customer Extensive use of
Affordable Prices Setting Trends strategy Service digital media
Key insights Corporate Social Responsibility
Score on fashion accountability varies from 0-25
Growth
Predicted 10% CAGR For Lifestyle Apparel Industry Increasing focus throughout the industry
No coherent policy on CSR between key players
Market Valuation
The Lifestyle Apparel Industry is predicted to be Key Players
worth $250 billion USD by 2026
Product range
Clothing, Footwear iconic outdoor and activity-based
lifestyle and workwear
Sources: McKinsey (2021), Yahoo (2018) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
33VF Corporation’s Performance In CSR Performance Positions It At
The Forefront Of The Industry
Statement on CSR
VF CORP.
“We want to know the product is sourced ethically. We have to protect all the workers in the
supply chain, and also make sure the materials sourcing is sustainable to the environment.”
Corporate Social Responsibility
Parent Company Of 12 Brands
Includes Vans and Supreme
Over 5,000 Stores Worldwide
Target: Young Urban People Recycling Ethics Traceability
72% of distribution Voted among the world’s Goal to make 100% key
centers have a waste most ethical companies materials traceable
diversion rate of >=95% for 5 years in a row by 2027
$23.7 Bln Valuation
Sources: VF Corporation Website and Fact Sheet Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
34Triple V Investments
Second Hand Apparel Lifestyle Apparel Industry Indian Textile Industry
Vinted VF Corporation Vardhman Textiles
The biggest player in the The global conglomerate India’s Second Largest Textile
growing second-hand resale operates in a growth market Producer Has Achieved
industry acts according to and places emphasis on Numerous Rewards In
sustainable and ethical Environmental Social Corporate Social
standards Governance Responsibility
Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
35Considering Investment Opportunities Further Back In The Supply
Chain, Tackles The Problem At The Root Of Its Cause
Key Characteristics Of Textile Industry
Primary Sector Of Wide Product Agro-Based Remained Stable Not Digitally
Apparel Industry Range Production Industry Throughout History Integrated
Industry Statistics Important Players
10% Estimated CAGR Of Textile
Industry Size Until 2025
20.2 Valuation In Billions Of Dollars
11% Predicted CAGR Industry Exports
Until 2026
Appendix 5
Source: Wazir Advisors (2021) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
36Vardhman Textiles Is The Most Sustainable And Fastest Growing
Indian Textile Company Therefore Supporting YM‘s Values
Mission Statement
VARDHMAN
“We seek to achieve customer delight through excellence in manufacturing and customer
service, based on creative combination of state-of-the-art technology and human resources.”
Awards Won
24 Production Facilities
Present in 5 States
Capacity to produce 580
metric tons of yarn per day
Key Markets: EU, USA,
Middle East Leading CSR Initiatives Top Exporter 9x Time Winner
CSR project of the Year FIEO Award Winner Textiles Export Promotion
$2 Bln Valuation Award 2021 in India 2009-2010 Council Awards
Source: Wazir Advisors (2021), Yahoo Finance (2022), Vardhman (2021) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
37FINANCIAL FEASIBILITY AND
FUTURE IMPACT
Triple V InvestmentsFinancial Analysis Emphasizes Strengths of Triple V Investments
Financial Analysis
Criteria and Tools Implications
Revenue CAGR -0,44% 43,64% 400%
VF Corporation and Vinted pose
Growth significant growth opportunities
Not
Return on Assets 6,3% 7,33% Disclosed
Standard Private
Deviation 5,24 5,59 Company The Volatility Analysis indicates
Volatility Vardhman and VF Corporation being
Beta Analysis
Private relatively low risk investments
0,59 1,49
Company
Debt to Equity Not
23,42 173,31
Disclosed To further evaluate an investment in
Liquidity Vinted, YM’s Necessary Disclosures are
Not needed, as it is a privately traded
Current Ratio 3,64 1,43 company
Disclosed
Appendix 6
Source: Yahoo Finance (2022), Retail Touch Points (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
39VF Corporation’s Stock Price Estimations Indicate An Expected
Fund Return Of 128,89%
Stock Price Estimations Key Considerations
99,95 $ USD
January 2020
90,1 $ USD 43,64% 4-Year Revenue CAGR
August 2023
58% Increase in DTC Digital Sales
78,7 $ USD
14,4% Increase in Stock Price
February 2023
Since Covid
61,5 $ USD
February 2022 Expected Fund
Return
128,89%
by Feb 2023
Source: Yahoo Finance (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
40Vardhman Textile’s Stock Price Estimations Indicate An Expected
Fund Return Of 156,5%
Stock Price Estimations Key Considerations
40,48 $ USD
February 2023 113% Annual Stock Increase 2021
10% Industry Growth Rate
32,25 $ USD
February 2022
Revenue Return to Pre-Covid
Levels
14,31 $ USD
February 2020 Expected Fund
Return
156,5%
by Feb 2023
Source: Yahoo Finance (2022) Introducing The Fund | Analysis Of Shein And The Industry | Investment Proposal
41Vinted, VF Corporation
And Vardhman
Accountability
Textiles Are Viable Sustainable
IDEAL
Reliable
Investment Options Prosperity
INVESTMENT
Stability
For The YM Pension Growth
FundThank You For Your Attention!
Appendix
Appendix 1 – Pestle Analysis Fast Fashion Industry
Social Economic
- More environmentally conscious à 20 to 25% of people already buying less now, - 5,91% growth in next three years
- 31% customers said they would seek sustainably manufactured clothing - Estimated worth 31 Billion us dollars up 22% from previous year
- Experiencing ”Fundamental change in habits” UBS Analystà similar to soft drink industry where sales - Fast-fashion retailers could face revenue declines of 10% to 30% over the next five to 10 years, the analysts
declined 25% in 2 years after perception of sugary drinks turned said in an emailed report.
- 60% Of McKinsey survery respondents claimed to go out of their way to purchase more sustainably - “Online options for reselling clothes have blown open the market: An industry-sponsored report found that
- Over 60% of people report spending less on fashion since COVID-19 Pandemic (McKinsey) the resale sector grew 25 times faster than traditional retail in 2019. At this rate, the secondhand market
- Only 19% of people care about newness à increase in vintage shopping could overshadow the fast fashion industry by 2030. This slower approach to fast fashion is clearly not just a
- 65% of respondents are planning to purchase more durable items and 71% planning to keep items for longer fad.”
- Nearly 60% of those between ages 18 and 21 care whether marketers offer environmentally friendly
products, which means green fabrics are in high demand these days.
Technological Legal
- Average annual growth rate of e-commerce fashion industry is 10,36% - No federal laws that regulate offshore outsourcing in the US
- “Sixty-one percent of Gen Zers (aged 24 and under) and 53% of millennials (ages 25-40) follow brands on - A study of the ILO found out that factory workers on average have to work more than 60 hours per week, in
social media, and a large number (49% and 38%, respectively) say they’ve made a clothing purchase based on 88% of the cases more than six days in a row.
a recommendation from a social media influencer, according to a 2021 survey.” - only 10% of the garment factories in Bangladesh count unions
- Shop Floor Control MES enables sewing operations to experience productivity gains from 11% to more than - No permits, licences, or approvals required to start offshoring
40% - North America Free Trade Agreement had negative side effect of making offshore outsourcing easier for
American companies à more than 950,000 jobs lost in America due to this agreement
- Internationally, The Sustainable Clothing Action Plan, signed by 80 different companies, aims to reduce
wastefulness and limit international business deals to countries that have established strict labor regulations
Political Environmental
- China US tension + China rest of world tensions (supporting Russia) - Textiles make up 35% of microplastic in oceans
- COVID lockdowns increase online shopping - 10,000 liters of water = 1 kg of cotton
- Supply chain issues due to covid - 6% of pesticides used only for cotton
- Uyghur Muslim abuse in China - Could use 26% of carbon budget by 2050 to keep the 2 degree celcius for global warming
Sources: McKinsey & Company (2021), MIT Sloan Management Review (2021),
Panaprium (2020), Retail Dive (2021) Appendix
45Appendix 2.1 - Evaluation Of SheIn’s Accountability
Traceability Wages & Well-being Raw Materials CONCLUSION
SCORE: 0/23 SCORE: 5/20
SCORE: 0/8
Poor labour standards No assurance of suppliers
No public disclosures about
No transparent procedures respecting human rights or
supply chain or
for addressing worker sustainable alternatives
5/150
responsibility taken Poor performance
complaints + No use of animal products
and no responsibility
taken regarding social,
Commercial Practices Environmental Justice Governance
environmental
responsibility and
SCORE: 0/15 SCORE: 0/42 SCORE: 0/42 human rights
No public acknowledgment No commitment to Growth is not compatible
of purchasing practice intersectional with 1.5 degree pathway throughout SheIn’s
No commitments to human Environmentalism Corporate strategy does not value chain
rights in contracts Usage of harmful chemicals include social or
No adaption to pandemic No PLC Stewardship environmental justice
Sources: Remake Report Shein (2021)
Appendix
46Appendix 2.2 - Evaluation Of H&M Group’s Accountability
Traceability Wages & Well-being Raw Materials CONCLUSION
SCORE: 5/20
SCORE: 3/23
SCORE: 5/8 Publicly committed to guarantee
18% of factories have collective
Company publicly discloses welfare of animals
Materials suppliers
bargaining agreements
Can not proof positive impact
39/150
Living wage not guaranteed Scores far over
Min wage per country on communities where
throughout the firm
(unsustainably) RM are sourced average
However:
Commercial Practices Environmental Justice Governance Company lacks clear
goals on becoming
SCORE: 13/42 sufficiently
SCORE: 3/15
Does not commit to fair pricing
Incentivizes suppliers with SCORE: 10/42 sustainable and can
training opportunities and long- Avoids hazardous chemicals
throughout the supply chain
term contracts who implement No goal on increasing product not prove progress on
Commits to resolve and address
the cause of company caused or
low carbon processes quality defined goals
Company does not show efforts Provides upcycling services
contributed harm
to meet goals
Sources: Remake Report H&M Group (2021)
Appendix
47Appendix 2.3 - Evaluation Of Zalando’s Accountability
Traceability Wages & Well-being Raw Materials CONCLUSION
SCORE: 1/8 SCORE: 2/20
SCORE: 0/23
Company privately discloses Acknowledges necessity of
Poor labour standards
Materials suppliers species-specific animal welfare
No transparent procedures for
No disclosure of existing labor Mainly relies on BCI cotton and 18/150
addressing worker complaints
condition Polyester made from fossil fuels
Zalando
acknowledges the
Commercial Practices Environmental Justice Governance necessity of certain
sustainability goals
SCORE: 1/15 SCORE: 8/42 but lacks clear goals
SCORE: 6/42
Acted responsibly towards its Supplier have to avoid the use
Board reflects regional and strategies to
suppliers during Covid-19 of harmful substances
pandemic Launch the pilot to increase
population achieve a sustainable
No clear strategy formulated to
Poor information about supply product lifetime
achieve sustainability goals or
chain and no prof of protection Lack of clear targets and
increase workers’ welfare
of human rights or fair pay implementation policies
Sources: Remake Report Zalando (2021)
Appendix
48Appendix 2.4 - Evaluation Of Fast Retailing’s Accountability
Traceability Wages & Well-being Raw Materials CONCLUSION
SCORE: 5/23 SCORE: 2/20
SCORE: 4/8
Public code of conduct Acknowledges necessity of
Partially discloses key insights
about the supply chain and
Does not give detailed species-specific animal welfare 24/150
information about wages and Use of materials toxic for Scores over average
conditions within factories
the well-being of workers workers and environment
mainly because of
impact on local
Commercial Practices Environmental Justice Governance communities in the
supply chain but lacks
SCORE: 1/15 clear goals to have a
SCORE: 8/42 SCORE: 4/42
Publicly commits to honor
Reduction in water pollution Builds up relationships with local broad sustainable
contracts
No Information about
and hazardous chemicals communities and have justice impact on the
No clear goals formulated to strategy
implementation of labor
have meaningful contribution Lack of diversity and clear goals environment
standards and human rights in
on environment on environmental jsutice
throughout the supply chain
Sources: Remake Report Fast Retailing (2021)
Appendix
49Appendix 3.1 - Further Risk Analysis Shein
Likelihood Of Occuring
Rare Unlikely Possible Likely
Almost
Certain
1 Environmental Concerns
Insignificant
2 Growth Concerns
Severity Of Impact
Minor
3 Laws And Regulations
Moderate
5
Major
2 3 4 Possibility Of Boycott
1
Extreme
4 5 Digital Security Risks
Sources: Reuters (2021) ZDNet (2018), Greenmatters (2021),
Financial Post (2021), Change.org (2021) Appendix
50Appendix 3.2 - Further Risk Analysis Vinted
Likelihood Of Occuring
Rare Unlikely Possible Likely
Almost
Certain
1 Environmental Concerns
Insignificant
2 Growth Concerns
Severity Of Impact
Minor
3 Laws And Regulations
Moderate
5
Major
3 2
4 Possibility Of Boycott
1
Extreme
4 5 Digital Security Risks
Sources: Reuters (2021) ZDNet (2018), Greenmatters (2021),
Financial Post (2021), Change.org (2021) Appendix
51Appendix 4 – Additional Market Trends
Market Trends
“Research shows that 88% of consumers want
brands to help them be more environmentally
friendly.” 1 Shift in consumer demand
Forbes Magazine 2020
“(..) a significant challenge is potential shortages of
products and resources, as chocked supply chains
and rising shipping costs undermine operations.”
2 Increasing challenges threatening the
effectiveness of current market strategy
McKinsey & Company 2022
“the increasing pressure coming from consumers
The concept of the fast fashion industry is
and activists together with NGOs responding to
this trend is causing a need for CSR in companies” 3 unlikely to remain profitable in upcoming
years
Wageningen University 2020
Appendix
52Appendix 5 – VF Corporation’s Portfolio
Appendix
53Appendix 6 - Why Indian Apparel Industry?
1 One Of The Highest Quality Textile Industries In the World
2 Has Some Of The Most Forward-Thinking Textile Companies With
Respects To Corporate Social Responsibility
3 High Stability
High GDP Contribution Export Importance Government Interest
Textile Industry Generates 12% Of Indian Exports Are Vested Interest And
Over 5% Of India’s GDP Produced By Textile Industry Investment In Industry
Source: InvestIndia (2022)
Appendix
54Appendix 7 – Evaluation Criteria For Lifestyle Apparel
Stability CSR Prosperity
1-2 1-3 1-2
30% below industry average on 1-30 on Transparency Index Revenue growth negative-0%
RFAR
3-5 4-5 3-5
29% below – average industry score 30-60 on TI RG 1- 3%
6-8 1-3 6-8
1-30% over average Barrons Sustainable Score 1-50 RG 4-8%
9-10 4-5 9-10
>30% over average BSS 51-100 RG>9%
Appendix
55Appendix 8.1 - Evaluation of Players in Lifestyle Apparel
Stability Accountability Prosperity Total Score
0/10 2/10 0/10 2/30
9/10 2/10 5/10 16/30
7/10 10/10 8/10 25/30
9/10 3/10 4/10 16/30
Appendix
56Appendix 8.2 - Evaluation of Players in Lifestyle Apparel
Stability Accountability Prosperity Total Score
9/10 8/10 10/10 27/30
7/10 6/10 10/10 23/30
9/10 7/10 10/10 26/30
5/10 6/10 10/10 21/30
Appendix
57Appendix 8.3 - Evaluation of Players In Secondhand Apparel
Stability Accountability Prosperity Total Score
5/10 3/10 5/10 13/30
4/10 2/10 10/10 16/30
5/10 2/10 10/10 17/30
7/10 4/10 10/10 21/30
Appendix
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Appendix
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