Temu vs Shein: It’s the battle of the fast fashion brands! These online shopping platforms have taken the e-Commerce world by storm. Shoppers are seduced by trendy and affordable clothing items at wholesale-like prices, with a new discount offered every day, so they’re willing to overlook longer international shipping and allegations of poor quality.
This week, we’ll compare Temu vs Shein, their impact on eCommerce, and the repercussions on Amazon sellers. How are these platforms transforming online shopping? And is Amazon worried?
We’ll also see about the controversies surrounding these platforms, because the spilling the tea on eCommerce makes life more interesting!
We just published a tell-all on Temu. Read about what is Temu, how does it make money, and is it legit?
Section 1: An Introduction to Temu vs Shein
Let’s pit Temu vs Shein in bite-sized format:
| Category | Shein | Temu |
|---|---|---|
| Brief History and Origin | Founded in March 2008 in Nanjing, China by Chris Xu. Initially focused on wedding dresses and later expanded into general fashion. | Launched in September 2022 by Pinduoduo (PDD) Holdings, headquartered in Dublin, Ireland. |
| Key Features and Unique Selling Points | High volume of new fashion items added daily, extensive use of social media for promotions, influencer collaborations. | Extremely low prices, aggressive discounting, gamified shopping experience, consignment model for sellers. |
| Product Range and Market Strategy | Primarily focuses on fashion (women, men, kids) and accessories, now includes home goods. Uses a network of small and medium-sized manufacturers. | Offers a wide variety of products including electronics, home goods, and fashion. Uses an ultra-competitive bidding system for suppliers. |
| How Much They’re Worth | GMV of $30 billion in 2023, net income of $2 billion in 2023. (Source: China Talk) | GMV of $16 billion in 2023. (Source: China Talk) |
Shein specializes in fashionable, affordable clothing and accessories. Shein is also starting to foray into electronics, decor, appliances, toys, and more. Because of its network of small and medium-sized manufacturing partners, who are mostly based in China, Shein can adapt to shifting trends pretty quickly. According to Contrary Research, Shein’s inventory turnover sits at just 47 days. In June 2023, Shein launched an integrated marketplace that offers items from third-party sellers with established brand names. Shein is supposed to have 600,000 products for sale at any given time. Shein has surpassed H&M and Zara in term of affordable products.
Like Shein, Temu also offers fashionable clothing and accessories. Temu provides cheaper pricing than Shein, but consumer sentiment is that Shein offers better product quality (although perhaps this isn’t the case across all products). Upon publishing this article, no data exists for the number of products available on the platform, but Temu may offer thousands upon thousands of products. Although Shein has focused on fashion, Temu has a pretty wide product selection.
Here’s a quick note – Shein and Temu’s performance hasn’t gone unnoticed by Amazon.
The affordable prices offered on these platforms have triggered Amazon enough for the e-commerce juggernaut to take measures. Shein and Temu currently ship up to 1 million packages a day to the US; those numbers are large enough for Amazon to take note. The e-commerce platform is posed to enter the fast fashion world through a new marketplace that will manage shipping from Chinese warehouses, indicating a departure from Amazon’s traditional support for small businesses, towards a rapid-production model that echoes what Shein and Temu do. Given Amazon’s extensive US customer base and higher trust rating compared to Shein and Temu, analysts are predicting that the shift is a profitable one, and that the shift will accelerate trends towards cheaper, faster fashion, impacting global trade, labor practices, and sustainability.
This shift could be worrisome for Amazon sellers. If Amazon chooses to invest more of its time and resources into Chinese warehouses, like Temu and Shein, it could get even harder to sell on the online marketplace, especially if you’ll be forced to compete with the low prices offered by Chinese warehouses. Selling on Amazon isn’t easy to begin with, so the time is right to explore expansion to other online marketplaces to diversify your channels.
Section 2: Shein and Temu: Shared Controversies and Concerns
You can’t get this big so quickly without raising a few eyebrows, Like Temu, Shein also faces criticism for a wide range of issues.
Temu vs Shein: Ethical Concerns
Allegations of Forced Labor and Poor Working Conditions
Temu and Shein share serious allegations regarding the working conditions in their respective supply chains. Investigators reported that workers are subjected to excessive hours, inadequate wages, and unsafe working environments. These workers are often recruited from marginalized or vulnerable communities – a big red flag for the human rights movement.
Intellectual Property Theft and Copying Designs from Independent Artists
When you buy from Shein, you might be buying items that have been copied from independent artists and small brands without permission or proper compensation – in other words, intellectual property theft. This practice affects the livelihood of these artists – and you must ask yourself about the ethical practices within Shein’s business model.
Temu vs Shein: Environmental Impact
Fast Fashion and Its Contribution to Environmental Waste
The fast fashion model employed by both Shein and Temu has a big impact on environmental degradation. The rapid production cycles and emphasis on low-cost, disposable clothing result in massive amounts of textile waste. This waste often ends up in landfills, which is definitely not a good sign for environmental pollution.
Company Claims vs. Reality in Sustainability Practices
Both companies have made claims regarding their efforts to improve sustainability within their operations. However, there is often a gap between these claims and the actual practices observed. For instance, while Shein promotes small-batch production to reduce waste, the sheer volume of products and the fast turnover rate suggest a different reality. Similarly, Temu’s sustainability claims need to be critically examined against their operational practices and environmental impact.
Data Privacy and Security Issues
Concerns Over Consumer Data Protection and Cybersecurity
Data privacy is a critical issue for both Temu and Shein, especially given the vast amounts of consumer data they handle. There have been concerns about how securely these companies manage personal information and the potential risks of data breaches. Inadequate cybersecurity measures could expose consumers to fraud, identity theft, and other digital crimes.
Legislative Scrutiny and Potential Regulatory Actions
Given all these issues, the US government is scrutinizing Shein and Temu in a big way.
Recent investigations have highlighted the exploitation of the “de minimis” provision, which allows packages valued under $800 to enter the US without import duties. According to the Select Committee on the CCP, Shein and Temu are accused of abusing this provision to evade scrutiny and taxes. The same committee has concerns with the Uyghur Forced Labor Prevention Act (UFLPA), which it feels Shein and Temu are betraying.
Both Temu and Shein offer standard shipping and express shipping options, even though the delivery time can take up to weeks. This is how items ordered from Temu and Shein can keep costs really low.
Furthermore, the US Customs and Border Protection (CBP) suspended several brokers from an expedited clearance program for direct-to-consumer imports, because of concerns of contraband entering the USA through this process. The crackdown, affecting all US ports of entry, comes amid political pressure to protect domestic businesses and address illegal drug trafficking. Shein and Temu rely heavily on this clearance process for their shipments, and will likely be affected by this investigation. (Source: Fast Company)
Market Practices
Accusations of Anti-Competitive Behavior
Temu and Shein have also been accused of engaging in anti-competitive practices. For instance, there have been allegations of these companies using their market power to coerce suppliers into exclusive agreements or undercutting competitors through aggressive pricing strategies. Such practices can stifle competition and harm the broader market ecosystem. In fact, Temu even sued Shein over “mafia-style intimidation” of suppliers.
Impact of Controversies on Brand Reputation and Consumer Trust
The various controversies surrounding Temu and Shein inevitably impact their brand reputation and consumer trust. Ethical concerns, environmental issues, and data privacy risks all contribute to a perception of these brands as being less responsible or trustworthy. This can affect consumer loyalty and influence buying decisions, potentially driving customers to seek alternatives perceived as more ethical or sustainable.
We wonder if this is the door that Amazon needs to open in order to provide better quality products, at affordable prices competitive with Shein and Temu, but without the issues facing these China-affiliated sites.
Section 4: Temu vs Shein: Impact on the eCommerce Landscape
Shifts in Consumer Behavior
Temu offers extremely low prices and a vast array of products – and so does Shein. These aggressive pricing strategies attract budget-conscious consumers, leading to a significant increase in impulse purchases and frequent buying behavior. In spite of the issues surrounding the platforms, the fact is they’re able to provide fashionable and trendy items for a fraction of the cost – and this appeals to new customers that are determinedly price-conscious.
Shoppers are more likely to experiment with new styles and products, because the financial risk is minimal. As a result, customers purchase more items per transaction, contributing to higher overall sales volumes for Shein and Temu.
Furthermore, both Shein and Temu offer user-friendly mobile shopping apps, with a seamless shopping experience. Shoppers get personalized recommendations, gamified shopping, and easy payment options. Consumers can browse and purchase products anytime, anywhere, further driving sales and customer engagement.
Whether the customers are shopping on Temu or Shein – or both – shopping is easy. That’s a big reason why many customers are happy with Temu and Shein, in spite of all the issues.
Challenges to Traditional Retailers
As a whole, e-Commerce has posed a big challenge for the traditional brick-and-mortar store – consumers have turned to online shopping for its convenience and cost savings. Physical stores face declining foot traffic and sales, forcing many traditional stores to integrate offline and online shopping experiences. Customers have access to thousands of products, and spend their time shopping while sitting on the couch with a cup of tea or glass of wine, plus you’re offered free shipping…it just doesn’t make as much sense to head to the malls for a cocktail dress or kids’ socks.
As we mentioned earlier, Amazon’s also feeling the impact of Temu and Shein’s disruptive presence. Perhaps in terms of quality, Amazon still wins, Temu and Shein may soon take over given the wide range of products with even better deals. The added competition is forcing Amazon to innovate, enhance its product offerings, and explore new market segments to maintain its market position.
Shein and Temu seem to be in it to win it. It’s so important to adapt and innovate if you plan to stay in the retail industry for the long haul.
Section 5: Temu vs Shein: Advice for Amazon Sellers
In the battle of Shein vs Temu, Amazon sellers are wondering, how are they affected? Given all of the controversy, is it wise to sit on your laurels, knowing you’re selling on the platform that’s got the most consumer trust and best quality control?
Perhaps not.
There’s no doubt that Shein and Temu are disrupting the e-Commerce landscape, and it’s something that Amazon sellers can learn from.
Offer a Seamless Shopping Experience
Shein focuses on the gamification of ecommerce through flash sales, points systems, and exclusive discounts. Temu uses huge discounts and freebies to encourage customers to come back over and over again. Basically, it’s fun to shop on these platforms. It’s an entire experience. Add to that how easy it is to navigate their mobile apps! If you’re selling through an omnichannel approach, see if you can make the shopping experience fun and easy.
Use AI to Recommend Products
Shop on either Temu or Shein, and you’ll notice related products pop up on your search – some at a fraction of the cost – with freebies and rebates everywhere you look. The algorithms offer similar products, which are great impulse buys, to augment what you’ve already added to your cart. These are either complementary products, like matching shoes for every bag purchase, or products from the same category, like stickers or cell phone cases the initial search might not have uncovered.
If You Can’t Fight Them On Price, Fight Them On Quality
Defined by the Oxford dictionary as “inexpensive clothing produced rapidly by mass-market retailers in response to the latest trends,” the quality offered by fast fashion is not that great. This Reddit thread shows that Temu’s quality is usually pretty dismal, and good for only one or two uses. This Reddit thread also echoes similar sentiments for Shein. Temu says it offers quality products at affordable prices, but many customers have bemoaned the bad quality. Whimsy Soul discovered that PDD Holdings, the company that owns Temu, also owns ByteDance, the parent company of TikTok – which is funny, because selling on TikTok Shop is pretty soon going to be a necessity for Amazon sellers, but selling on Temu seems to be a bit of a risk. Given that prices are incredibly low on Temu and Shein for a myriad of reasons, if you can’t fight them on price, you definitely can fight them on a basis of quality goods that will last more than a few washes, or even just a season.
Implement a Free (and Fast) Shipping Policy
Temu and Shein’s rapid rise in the eCommerce market has led to significant shipping issues, as their low-cost, direct-from-China delivery model often results in longer delivery times and bottlenecks compared to Amazon’s established and efficient logistics network. Thankfully, Prime members already get free shipping. A huge reason customers get disillusioned with Shein and Temu is how long shipping takes. Shipping typically takes weeks to get the the US from either platform. Temu ships from China, and Shein’s clothes come from warehouses all over the world. A platform that offers free shipping – even free return shipping for defective or unwanted items – is likely to compete pretty well against Temu vs Shein.
Conclusion: Is Temu Better than Shein?
Let’s weigh the results in the battle of fast fashion. Temu vs Shein – which is better?
If you’re thinking about the sheer number of categories, it’s Temu that emerges as the winner. The platform has a wider array of products compared to Shein, whose diversification from fashion is just beginning.
If you’re thinking about the trendiness of the products, and possibly even the quality of the merchandise, it’s Shein. Unlike Temu, Shein’s clothing lasts more than just 3 wash cycles. Also, Shein sells fashion items that are in line with today’s trends, whereas Temu’s items are more basic in design.
At the end of the day, if you’re looking at selling on either Shein or Temu (or both), you’re set to appeal to a very price-conscious consumer, who doesn’t care if the dress goes out of season in a month, or if the shirt comes apart in the wash. Perhaps that’s the entire point of fast fashion, after all.
Alternatively, you could rest easy that you’re selling on Amazon, a platform that doesn’t have the issues and challenges associated with Shein and Temu. It doesn’t look like either platform will overtake Amazon any time soon, although the fact that they’ve gained Amazon’s attention means there’s something to learn from their model.
Whatever your choice may be, the outcome is clear: the best thing to do is to innovate constantly, provide an easy and enjoyable shopping experience, leverage on the power of AI to provide product recommendations to push impulse buys, and implement a free shipping policy that’s thoroughly customer-centric.
That way, regardless of which platform emerges victorious, you’re always going to be at the top of your game.
After all we’ve said here, what do you think? Some people think Temu is better. Some people think Shein is better.
We think Amazon reigns supreme!