The New Landscape of Cross-Border E-Commerce
Chinese e-commerce giants have increasingly turned their attention to overseas markets, with companies like ByteDance, JD.com, and Alibaba having already established their cross-border operations. Now, Pinduoduo, known for its "group buying" model in China, has joined the competition by launching its international platform Temu in September, with the United States as its first target market.
This move represents a significant step in Chinese internet companies' global expansion strategies and signals intensifying competition in the cross-border e-commerce sector. While Pinduoduo's low-price strategy proved successful domestically, its effectiveness in the U.S. market remains uncertain. For sellers, understanding Temu's policies and operational model is crucial to capitalizing on this new opportunity.
Key Considerations for Sellers: Entry Requirements and Process
For prospective sellers, the primary concerns revolve around entry barriers and onboarding procedures. Below is a detailed breakdown of Temu's requirements, support policies, and registration steps.
Temu's Seller Requirements
Temu maintains relatively clear criteria for potential sellers, focusing on four key areas:
- Cross-border experience: Demonstrated e-commerce experience on platforms like Amazon, Walmart, AliExpress, SHEIN, eBay, or Shopee, or experience operating independent websites.
- Supply chain capabilities: Stable inventory availability and strong supply chain integration to ensure product quality and delivery speed.
- Operational competence: Skills in product image processing, copywriting, and independent product listing and store management.
- Product quality and user experience: Commitment to quality products and positive consumer experiences.
Temu's Support Policies
To attract sellers, Temu offers several support measures:
- Free registration: No upfront fees for joining the platform.
- No deposits or commissions: Sellers aren't required to pay deposits, and the platform doesn't take sales commissions.
- Fast settlements: Payments processed one day after customer receipt.
- Shipping subsidies: Temu covers international shipping costs after sellers deliver goods to domestic warehouses.
Deposit System
Temu requires a basic deposit of approximately $140 (1,000 RMB), with additional deposits ranging from $140 to $1,400 based on sales volume tiers. These measures aim to protect consumers and maintain platform integrity.
Shipping Model: Domestic Warehouse Distribution
Temu currently operates without overseas warehouses. Sellers must ship products to designated domestic warehouses (primarily in Guangzhou), from which Temu handles international distribution. While the platform covers post-warehousing costs, sellers must maintain adequate inventory and meet turnover requirements.
Product Categories
Temu offers 21 primary product categories, including:
- Home and kitchen supplies
- Electronics
- Beauty and personal care
- Clothing and accessories
- Sports and outdoor equipment
- Toys and games
- Pet supplies
- Automotive products
Registration Process
The onboarding process involves three key steps:
Step 1: Account Creation
Prospective sellers must register through Temu's merchant portal using a mobile number and verification code.
Step 2: Completing Registration Information
Currently, Temu only accepts standard store registrations from business license holders. Specialized, flagship, and brand-exclusive store options remain unavailable.
Step 3: Business Information Submission
Sellers must provide business license details, legal representative information, and operational overviews. Some may encounter verification issues requiring multiple attempts or customer support assistance.
Market Analysis and Recommendations
Temu presents opportunities for sellers with cross-border experience and strong supply chains. However, success requires careful consideration of several factors:
- Pricing challenges: While low prices drive domestic success, U.S. consumers prioritize quality and service.
- Logistics efficiency: Domestic warehouse models may impact delivery times despite cost advantages.
- Market research: Thorough understanding of U.S. consumer preferences and competitive landscapes is essential for product selection.
Pinduoduo's Temu expansion offers Chinese sellers new international opportunities. By understanding the platform's requirements and operational framework, businesses can strategically position themselves in the competitive U.S. market.