Core Insights - Temu has surpassed Amazon to become the world's leading e-commerce platform in terms of monthly active users, while also securing the position of the second-largest e-commerce platform in Brazil [2][5] - The rapid growth of Temu presents both opportunities and challenges for cross-border e-commerce sellers, necessitating a dual-platform strategy that leverages both Temu's growth potential and Amazon's established user base [1][7] Group 1: Temu's Growth - Temu has achieved the highest monthly active users globally, surpassing Amazon, with a projected GMV of over $50 billion in 2024 and an expected $70-80 billion in 2025, driven by a low-price strategy that attracts a large user base [2] - In Brazil, Temu has captured a 9.9% market share, overtaking Shopee to become the second-largest e-commerce platform, with a significant increase in monthly clicks and a 132% year-on-year rise in imported goods access [5][10] Group 2: Competitive Landscape - Amazon is intensifying competition by launching a low-price marketplace, Haul, in an effort to reclaim market share, particularly in the lower-tier market segments [6] - Temu is exploring a third-party platform model similar to Taobao, allowing merchants to set their own prices and manage shipping, which could enhance its competitive edge [6] Group 3: Seller Strategies - Sellers are encouraged to adopt a dual-platform strategy, focusing on Temu for growth opportunities while maintaining a strong presence on Amazon to ensure profitability [7] - Temu's low-price strategy is particularly effective for clearing inventory and testing new products, while Amazon's established ecosystem supports high-value, brand-oriented products [8][9] Group 4: Operational Solutions - Easy ERP provides seamless support for managing operations across both Temu and Amazon, facilitating automated order processing and efficient inventory management [11][15] - The system allows for real-time synchronization of SKU information and order statuses, enhancing operational efficiency and reducing manual workload [11][16]

Core Viewpoint - PDD Holdings, the parent company of Temu, reported a significant decline in profits for the first quarter, with revenue growth hitting a three-year low, indicating challenges in its operational model due to tariffs and weak consumer sentiment in its domestic market [1][4]. Financial Performance - Total revenue for Pinduoduo in the first quarter increased by 10% year-on-year to RMB 95.7 billion (approximately $13.7 billion), falling short of analyst expectations by RMB 5.9 billion (approximately $824 million) [4]. - Net income dropped by 47% year-on-year to RMB 14.7 billion (approximately $2.1 billion), missing general expectations by RMB 11 billion (approximately $1.5 billion), highlighting the impact of financial charges on profitability [4]. Market Challenges - The sudden slowdown in Pinduoduo's performance suggests that its business model is struggling to cope with combined pressures from tariffs, the end of minimum exemption, and fierce price competition in China's retail ecosystem [5]. - The macroeconomic and regulatory environment is currently unfavorable for Temu, with increasing trade barriers being set by governments to protect domestic interests [5]. Regulatory Developments - The EU has proposed a unified tax of €2 (approximately $2.27) on small packages valued under €150 (approximately $170.02) entering the European market, which could further impact Temu's pricing strategy [6][8]. - The G7 countries are also discussing imposing tariffs on ultra-low-priced goods from China, which could affect Temu's operations [6][8]. Strategic Adjustments - Temu has begun local warehousing services in Europe since December, with plans for 80% of European orders to be shipped from local warehouses [14]. - The company is adjusting its operational model to address regulatory challenges and consumer quality demands by gradually phasing out ultra-low-priced products and reducing user subsidies [14]. Market Position and Growth - According to Emerce, Temu's market share in Europe is expected to grow significantly to 35%-40%, surpassing North America as its largest market, with active users in Europe exceeding 120 million [11]. - The projected GMV for Temu in Europe is expected to reach €58 billion by 2025, reflecting a 45% increase from 2024 [11].

Core Insights - Temu sellers in the U.S. are experiencing unprecedented turbulence since 2025, with consumer spending on the platform showing a significant decline from nearly 50% growth at the beginning of April to almost zero by the end of the month [1] - A large number of sellers have reported a drastic drop in product sales, attributed to platform policy adjustments, increased competition, and the impact of U.S.-China trade tensions, particularly the cancellation of the T86 tax exemption policy [1][6] Group 1: Sales and Pricing Issues - Many Temu sellers have reported a sudden increase in "high-price limit" notifications, with the number of affected products rising from 5 to 45, impacting best-selling items [2] - The introduction of new pricing rules in March 2024 has led to penalties for sellers whose prices exceed those of competitors, resulting in restrictions on new listings and withdrawal freezes [4] - Despite some products being released from "high-price limit" status, many sellers still face poor sales performance [5] Group 2: Impact of T86 Tax Exemption Cancellation - Following the cancellation of the T86 tax exemption, Temu has removed numerous fully managed products from the U.S. market, although some tariffs have been reduced [6] - Contrary to expectations, only a few semi-managed products have seen sales increases, while many sellers report significant declines, with some experiencing drops of up to 90% [6] Group 3: Advertising and Price Adjustments - Temu has reduced its advertising spending on platforms like Meta, X, and YouTube by an average of 31%, contributing to decreased sales in the U.S. [7] - The front-end prices of many semi-managed products have surged, leading to consumer dissatisfaction and further sales declines [8] - A recent survey indicated that Temu's sales dropped by approximately 10% week-over-week from April 27 to May 4 compared to the same period in 2024 [8] Group 4: Seller Dilemmas - The reduction in advertising is expected to shrink the traffic pool for fully managed products to about 30% of its original size, while semi-managed products may not see significant changes [11] - Sellers are caught in a dilemma: they must choose between lowering prices to maintain sales, which sacrifices profit, or maintaining prices and facing declining sales [11]