The daily order volume is four to five thousand, and the Temu seller can’t handle it anymore

Daily order volume is overwhelming for Temu seller

Recently, Temu has started a new round of price cuts. Sellers have reported that the platform is implementing a minimum price policy, and if the product price is high, it will prompt the seller to lower the price. The platform requires the seller to lower the price on the basis of the verified price. Every night, a dozen or so notifications to lower the price will pop up on the seller’s account. Refusing to do so will affect traffic and sales volume.

Temu has also copied the “refund only, no return” clause from Pinduoduo. Some users have shared on social media that the platform directly tells them “no need to return” when they ask for a refund. Sellers are worried that foreign “bargain hunters” may flock to the platform.

A new round of price cuts has caused some sellers to quit

For sellers who joined Temu earlier, orders are no longer a problem, but the price pressure is increasing.

One seller has made 4,000-5,000 orders per day and over 10,000 in daily profit by importing best sellers for three months. This is hard to imagine on other platforms. The seller invested more than 2 million yuan, but now is giving up because of the platform’s minimum price policy, “if the price is not low enough, we are required to change the price. The software automatically detects high prices and prompts a reduction.”

Some sellers say that if they are willing to make a profit of only 0.5 yuan per item, they can easily make thousands of orders per day. However, the low profit margin has caused them to give up on many products.

“Recently, Temu has started requiring sellers to lower prices on the basis of the verified price. Every night at around 8 o’clock, a dozen or so notifications to confirm the price cut will pop up on each seller’s account. If the seller disagrees, there will be a warning in red font that it will affect subsequent traffic and sales volume, and the seller will be responsible for all consequences.” said @ (Foreign Trade Mom Api).

She mentioned that the cost price of a pair of shorts she sold was about 12.5 yuan, and she listed it for 12 yuan. She sold more than 200 pieces with a 100% positive rating, but was asked to lower the price to 8.8 yuan because there was not much inventory left. She agreed to do so. “I don’t know how new sellers are coping now. Although new products still have profit margins, I don’t know if the platform will ask sellers to lower prices at 8:00 p.m. tonight or tomorrow night.”

The supply price on the platform is getting lower and lower. A seller heard that a friend made over 100,000 yuan a month by selling on Temu, so he quickly found a factory to cooperate with for supply registration, but got stuck in the quotation process. “It made me doubt my life. My factory’s prices are already very cheap, but they want to cut it in half. They directly cut the unit price of products that cost tens of yuan to even lower than my cost.”

The continuous demand for price reduction is squeezing the profits of trade-oriented businesses.

A seller was told that a popular product in his store must be priced at the lowest price on 1688, otherwise it will be delisted. This product was indeed purchased through 1688, and the seller’s warehouse still has 2,000 sets of inventory. However, he can only accept the buyer’s price, which will result in loss on both ends due to shipping costs. He hopes to clear the inventory at a loss.

“To be honest, I felt a chill in my heart at that moment. Suddenly, I felt that the 400,000 yuan we invested and the four personnel we hired on this platform were worth nothing,” the seller said. He questioned, if the platform needs the price listed on 1688, why was it approved in the first place? “To put it bluntly, it’s to make a lot of trade-oriented businesses and individual sellers test the product. Once a popular product is tested, they kill the donkey that pulled the millstone.”

There was an analysis in the industry when Temu was launched: the platform needs ultra-low prices, and the corresponding group of merchants are factory or trade-oriented businesses. Trade-oriented businesses have limited advantages in the supply chain, but these cross-border sellers have rich experience and a keen sense of smell for popular products, which can pave the way for the platform in the early stage.

It is also because of this gap that many cross-border sellers have expressed that this platform is not suitable for them after trying it out. “I’m ready to withdraw from Temu and let others make money,” said one cross-border seller.

For those who are used to the third-party platform model, Temu’s investment in products is relatively low, and the effort is quickly overtaken by other platforms. The more stock there is, the more passive it becomes. Sellers focus on profit rather than sales volume, and Temu is more positioned as a clearance channel rather than a primary sales platform.

“Refunds only, no returns”, overseas users get a bargain

Low prices are a tight curse for sellers and a killer for platforms to attract customers, and can even snatch customers from Amazon.

A French user lamented: “Temu’s algorithm and marketing are very advanced. All the things needed in a search are ranked high, and the prices are more than half lower than the normal prices. It is said that they plan to lose $500 a year to retain a regular customer. I just placed a few orders on it (because they give you several large coupons for one order), including a stainless steel coffee latte pot and a children’s coloring book. If the quality is good, I will stop my Amazon Prime membership.”

After attracting customers to place orders, Temu will also use quality service to retain them, one of which is “refund only, no returns”.

A Chinese resident in the UK spent £7.64 to buy a pair of shoes from Temu, and because they were too tight, they planned to return them. At this time, the platform informed them that they did not need to return the goods, and they would receive a refund directly — “You don’t need to return these items. Please keep, donate, or recycle them.” The buyer said frankly: “I encountered a situation where I was allowed to get a refund without returning the goods for the first time after many years of online shopping. I was confused.”

(Image source @Beese)

A cross-border seller pointed out that although various platforms at home and abroad allow customers to get a refund without returning the goods, there should be no direct and explicit prompts like this… “I estimate that those professional brush hands with thousands of buyer accounts will soon teach them how to be human. If Temu suddenly gets a lot of orders, they should be careful.”

The platform uses “refund only, no return” to please consumers, which is a major pain point for sellers. In the domestic e-commerce market, the option of “refund only, no return” on Pinduoduo has caused many merchants to be angry and accuse the platform, and some regions and user groups have abused the service, even publicly teaching how to get free products. This situation is likely to happen overseas.

Currently, many Temu sellers are also facing the problem of difficult replenishment, and shipping can only be done by grabbing, causing sellers to complain that their mouse clicks are smoking. The business manager recommends trying at 0:00, 11:00, 11:30, and 13:00, and the probability of success is low at other times; in addition, popular products should be grabbed separately, and quota allocation will be prioritized.

Flattening cross-border e-commerce, sellers beware of full-service platform models

As Temu and other platforms continue to gather full-service models, the cross-border e-commerce chain is being simplified and flattened.

Sellers believe that with the emergence of full-service platforms, this model eliminates the middleman and directly connects to the factory for supply, sellers who use the procurement-sales model should be cautious. “In addition to observing the development trends of such platforms in the past two years, we must also start thinking about business model transformation and upgrading, and be prepared in advance for possible changes in the future.”

On full-service platforms, many merchants can only compete on the supply chain and are squeezed to the lowest cost to compete on price. But both trade-type and factory-type sellers face difficulties. “According to Temu’s repayment speed and operating philosophy, it is very costly for middlemen to operate, with personnel and capital cost issues; and factories need popular products, and many factories are unwilling to do it without popular products,” analyzed a seller.

With its low-price model and abundant SKU, Temu has taken off.

Recently, Modern Retail and Attest conducted a survey of 1,000 American consumers to find out the most popular shopping platforms in the US, excluding Amazon. The results showed that in the past 6 months, the most frequently used shopping platforms by respondents were eBay (32%), SHEIN (21%), and Temu (17%). On Trust Pilot Reviews, Temu has over 1,700 reviews with an average rating of 2.9 stars. One-star negative reviews are in the majority, with most people complaining about long shipping times, poor product quality, and bad customer service. There are also many five-star reviews, mainly praising the low prices and a large number of products.

On social media platforms such as TikTok, many people are satisfied with their shopping experiences on Temu, from small gadgets and household items to clothing and shoes. It is obvious that cross-border e-commerce platforms are reshuffling.

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