Axios Closer

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September 15, 2022

Hello again! Let's dig into Thursday.

Today's newsletter is 682 words, a 2½-minute read.

🔔 The dashboard: The S&P 500 closed down 1.1%.

  • Biggest gainer? Humana (+8.4%), the health insurer, after boosting its guidance for the year.
  • Biggest decliner? Adobe (-16.8%), the computer software company, after announcing a $20 billion cash and stock deal to buy Figma.

1 big thing: Even faster fashion

Illustration of a dress with colorful motion blur trailing it
Illustration: Natalie Peeples/Axios

Fast fashion is about to get faster, Hope writes.

Driving the news: Shein, the privately held online retailer based in China, plans to build three large distribution centers in the U.S. in an effort to put products in the hands of customers much faster in its largest market, WSJ reports.

Why it matters: Shein is one of the most-visited fashion websites in the world, powered by people who want cheap versions of new styles.

  • U.S. customers currently have to wait 10–15 days for orders to be delivered from China, weeks longer than competitors, including Amazon, Zara and H&M.
  • The expansion could eventually cut shipping times by three to four days, George Chiao, president of Shein’s U.S. operations, told the Journal. 

The big picture: Shein is the third-most valuable startup in the world. Total annual sales for the company reached at least $16 billion last year, up from $10 billion in 2020, per Bloomberg.

  • Retailers across the board have been investing in their warehouse and distribution footprint, ranging from Zara to Walmart, amid a glut of inventory and increased demand.

What they're saying: As Shein tries to expand into higher-priced products, long delivery times have to come down, Credit Suisse analyst Simon Irwin noted to the Journal.

Be smart: What makes fast fashion fast has a lot to do with compressing the time between market research and customer orders.

  • Shein’s product cycle reportedly takes just a few days compared to competitors’ cycles of weeks.
  • Manual laborers reportedly sew hundreds of pieces a day on tabletop sewing machines.

2. Charted: Drinks on me!

Data: St. Louis Fed; Chart: Thomas Oide/Axios

Americans spent 1.1% more at restaurants and bars last month than they did in July, the latest reminder that people are still spending to go out, Axios' Pete Gannon writes.

By the numbers: Sales at restaurants and bars last month outpaced last year's August by 10.9%.

  • And sales have increased 18.5% for the first eight months of the year compared to the same period last year.

3. What's happening

🎬 Disney officially removed Star Wars spinoff “Rogue Squadron” from its film calendar. (CNBC)

💡 Bank of America is starting a paid sabbatical program for longtime employees. (Bloomberg)

4. Buy now, regulate later

Illustration: Allie Carl/Axios

“Buy now, pay later” services are about to be tamed, Hope writes.

  • The Consumer Financial Protection Bureau, created after the financial crisis to regulate predatory lending practices, has issued its much-anticipated report on how it might oversee companies like Affirm and Afterpay.

Why it matters: The pay-by-installment industry has credited its popularity to widespread distrust of credit cards and now it could be treated by regulators in the same way.

  • Merchandise purchased through Affirm, Afterpay, Klarna, PayPal and Zip grew to $24.2 billion last year, nearly triple what it was in 2020, the CFPB found.

Details: The watchdog plans to regulate these companies the same way as it does credit card companies, and it's looking into customer fees and ways to limit how personal data is used by such businesses, Axios Pro Fintech Deals co-author Lucinda Shen notes.

What to watch: How future rules may curb consumer spending, especially among younger shoppers who have been big drivers of BNPL use.

Go deeper.

5. 🐐 Maaa — another GOAT retires

Serena Williams and Roger Federer during a 2019 mixed doubles match in Perth, Australia. Photo: Paul Kane/Getty Images)

Roger Federer, the winner of 20 Grand Slam singles titles over his 24-year career, is hanging up his tennis shoes, Pete writes.

😯 OK, OK, we don't mean to throw "GOAT" around lightly! But whether you're a Federer guy or not — he's in the conversation.

  • The two greats dominated their respective eras. Combined, they spent 629 weeks ranked No. 1 in the world of professional tennis.

What he's saying: "I consider myself one of the most fortunate people on Earth," Federer said. "I was given a special talent to play tennis, and I did it at a level that I never imagined, for much longer than I ever thought possible."

6. What they're saying

“Today is a win. … This agreement is validation of what I’ve always believed — unions and management can work together.”
— President Biden today, on a last-minute deal averting a railroad strike.

Today's newsletter was edited by Pete Gannon and copy edited by Sheryl Miller