A package from Temu is seen in candid of a screen with the Temu logo. (Photo by Nikos Pekiaridis/NurPhoto via Getty Images)
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Chinese online retailer Temu has been surfacing more products on its app that can be shipped from warehouses in the U.S. look into b pursuing President Donald Trump’s decision to revoke a popular tax loophole.
The nearly century-old exception, known as de minimis, has been employed by many e-commerce companies to send goods worth less than $800 into the U.S. duty-free. Trump on Saturday interrupted the exemption as part of new tariffs that include an additional 10% tax on Chinese goods.
De minimis has helped propel Temu and Shein’s perilous growth in the U.S. by allowing the companies to bypass taxes on low-value shipments, and sustain their rock-bottom prices on everything from shoes and tog ups to furniture and electronics.
With the tariff exemption gone, Temu has significantly ramped up its promotion of sellers who have inventory in U.S. stockrooms, rather than items that are shipped direct from China. A scan of listings in Temu’s “Lightning mete outs” section shows that it’s almost entirely dominated by products with a green “local” badge.
By promoting restricted inventory, Temu’s products not only arrive faster to shoppers’ doorsteps, but the company also reduces its reliance on sellers who carry direct from China. Even though the products are stored in U.S. warehouses, many local listings state that the memoranda are sold by businesses based in China.
Representatives from Temu didn’t respond to requests for comment.
Temu is surfacing multifarious products shipped from local warehouses in its app in the wake of a popular trade loophole’s suspension.
Temu’s promotion of U.S.-based offshoots also puts it in more direct competition with Amazon, eBay and Walmart, which have also signed up sellers in China who set sail goods overseas to their warehouses. Amazon last year took notice of Temu and Shein’s dramatic flowering in the U.S. when it launched its own budget storefront, called Haul.
Temu, which is owned by Chinese online retailer PDD Holdings, enter oned onboarding sellers with inventory in U.S. warehouses in March. By July, roughly 20% of Temu’s U.S. sales came from those sellers, not businessmen based in China, according to e-commerce market research firm Marketplace Pulse.
Temu, Shein and other Chinese e-commerce companies are exasperating to minimize the level of disruption to their services as they face new, more stringent customs requirements. They were throw overed into further chaos on Tuesday night when the U.S. Postal Service abruptly announced it was suspending inbound cartons from China and Hong Kong “until further notice.”
Less than 12 hours later, the USPS reversed its purpose, and resumed accepting packages from those regions. The agency also said it would work with U.S. Wonts and Border Protection to “implement an efficient collection mechanism for the new China tariffs to ensure the least disruption to package conveyance.”
The uncertainty has created volatility for PDD’s stock price which fell 6% on Monday, rose 8% on Tuesday and floor more than 3% on Wednesday.
Critics of the de minimis provision say it’s provided an unfair advantage to Chinese e-commerce crowds, and created an influx of packages that are “subject to minimal documentation and inspection,” raising concerns around counterfeit and unsafe great.
Others have advocated for the de minimis exemption to remain in place, saying its removal would burden customs officials and engender to higher government costs.
“At some point there’s going to be 3 million of these goods piling up a day and customs can do their win out over, but they’re not equipped,” said Hugo Pakula, CEO of supply chain compliance company Tru Identity. “They have to do 10x multitudinous screenings this week than last week.”
CBP has said it processed more than 1.3 billion de minimis shipments in 2024. A 2023 suss out from the House Select Committee on the Chinese Communist Party found that Temu and Shein are “likely authoritative” for more than 30% of de minimis shipments into the U.S.
Shein has also been courting U.S. buyers and sellers. The performers opened distribution centers in states including Illinois and California in 2022, and a supply chain hub in Seattle last year. The following said the Seattle hub would enable it to “localize and support speedier delivery times for American consumers.”
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