Chinese e-commerce platforms Temu and Shein are set to increase their prices for US customers next week, responding to changes in global trade policies influenced by tariffs introduced during Donald Trump’s presidency. Both companies, which have gained popularity in the US by offering extremely low prices, announced that their operating costs have risen due to recent adjustments in trade regulations.
While the specifics of the price hikes remain undisclosed, both companies cited “price adjustments” in nearly identical notifications to their customers. The tariffs imposed by Trump, which include a hefty 145 per cent on a wide range of Chinese products, have significantly affected their business models. Additionally, the removal of a customs exemption for goods valued under $800, which allowed many low-cost items to enter the US duty-free, will also take effect shortly.
This executive action, which will start on May 2, is expected to impact roughly four million low-value parcels arriving daily from China, an influx that has been particularly beneficial for e-commerce businesses. The de minimis exemption was targeted by US politicians and business groups, who argued it facilitated unfair competition for inexpensive Chinese goods while providing a gateway for illegal narcotics and counterfeit products into the United States.
Shein focuses on affordable fashion and beauty products, appealing largely to younger women through influencer partnerships, whereas Temu offers a broader range of goods, from household items to electronics. As both companies look to adjust to these new costs, they have recently decreased their advertising expenditures on social media, a tactic that has heightened their visibility and customer engagement.
Despite these challenges, both companies are urging customers to continue shopping prior to the price adjustments, with Temu reassuring users that they have stocked inventory to ensure smooth order fulfilment. Overall, these developments signal a significant shift in the landscape for e-commerce as companies adapt to evolving trade tariffs and competitive pressures.