Temu and Shein are in a tricky spot — but it's mostly good news

Group 1: Trade War Context - Temu and Shein are currently navigating a 90-day reprieve in the trade war with China, with tariffs reduced to 30% from 145% as negotiations for a new trade deal begin [1] - High tariffs remain on small packages shipped directly from China, which are typically used by Temu and Shein [1] Group 2: Tariff Changes and Impacts - The de minimis exception allowing packages under $800 to ship without duty has been closed by Trump, with new tariffs as high as 120% or a flat fee of $100 per package, increasing to $200 in June [2] - Despite the 90-day deal, these tariffs remain in effect, impacting the shipping strategies of Temu and Shein [2] Group 3: Strategic Adjustments by Temu - Temu has implemented a workaround by building US warehouses, allowing for local shipping and avoiding extra import charges [3] - The company has adjusted its site to primarily display items that ship from US warehouses, aiming to recruit more US-based sellers [3] Group 4: Future Considerations - While the current strategy helps, Temu will eventually need to restock US warehouses, which will be subject to the higher tariffs [4] - Temu has options to focus on other markets or wait for a potential trade deal [4] Group 5: Current Situation for Sellers - The situation remains challenging for Temu and Shein due to high tariffs on direct shipments from China, but replenishing US warehouses with lower tariff charges provides some relief [5] - Sellers on Temu are experiencing positive sentiment, with one seller reporting mid-double-digit sales growth as American consumers stock up before potential price increases [8][9]