Temu's strategic shift: Stop direct shipping from China and turn to domestic sellers in the United States

Recently, Temu suddenly announced that it would stop selling China-direct products to U.S. consumers through its platform and massively removed fully-managed links. This strategic adjustment has attracted widespread attention in the cross-border e-commerce sector.

A Temu spokesperson confirmed that sales in the U.S. market are now fully led by local sellers. Products shipped from within the U.S. are no longer subject to import fees, and there are no additional charges upon delivery. In contrast, China-direct products usually bear import costs of 1.3 to 1.5 times the product value, with the actual total cost of some orders even reaching more than twice the original price. This adjustment is due to multiple factors, among which the latest changes in U.S. customs policy play a key role.

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New U.S. Customs Regulations Force Platform Reform

According to a notice issued by U.S. Customs and Border Protection on May 1, starting from May 2, 2025, the de minimis tariff exemption policy for goods from mainland China and Hong Kong will no longer be implemented. All goods exported from China to the U.S. must be declared according to the specified customs declaration type (such as Type 11 or Type 01) and pay the corresponding duties and taxes. Small parcels that do not meet the requirements will face the risk of being unable to clear customs.

This new regulation will significantly increase the cost for Chinese goods to enter the U.S. market, directly impacting the cost structure and pricing strategies of cross-border e-commerce. For platforms relying on China-direct products, the rise in import costs leading to higher final product prices may weaken their market competitiveness. Temu's adjustment is clearly aimed at adapting to this policy change, ensuring platform operations comply with the new regulations, and maintaining access to the U.S. market.

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Localization Strategy Reshapes Platform Ecosystem

For the platform itself, the localization strategy will have a dual impact.

On one hand, short-term growth may be suppressed. After losing the low-price advantage of the Chinese supply chain, Temu needs to rebuild its local supplier network, which may reduce product variety and price competitiveness; on the other hand, compliance will improve in the long run. Through local warehousing and seller systems, the platform can respond more flexibly to changes in trade policies in different countries and reduce the risks of cross-border logistics delays and customs clearance.

In addition, Temu's accelerated recruitment of U.S. sellers may also drive its transformation from a Chinese manufacturing export platform to a global localized e-commerce platform, enabling differentiated competition with rivals such as Amazon and TikTok Shop.

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Survival Rules for Sellers

For Chinese sellers, coping with this shock requires a combination of "short-term loss control + long-term transformation" strategies.

In the short term, they can prioritize clearing unsold inventory and recover funds through promotions or by shifting to other markets that still support direct shipping (such as Europe and Southeast Asia); in the medium to long term, they need to explore the "local warehouse stocking" model, or cooperate with overseas warehouse service providers to pre-stock some high-turnover products in the U.S. to maintain market presence. In addition, some sellers may switch to a semi-managed model, reducing costs by optimizing product selection (such as high value-added, lightweight items) and logistics solutions.

For Temu, the challenge after the strategic adjustment is to balance "localization" and "cost-effectiveness." If the platform can successfully attract U.S. small and medium-sized businesses and provide them with product selection support based on Pinduoduo Group's supply chain resources, it may be able to maintain its low-price label; otherwise, if local supply chain costs are too high, it may lose price-sensitive users. Meanwhile, other cross-border platforms may take the opportunity to compete for Chinese seller resources, further intensifying competition in the global e-commerce market.

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A New Cross-Border Order in the Era of Compliance

This strategic contraction by Temu is both a passive choice under pressure from U.S. trade policy and an inevitable pain as cross-border e-commerce shifts from wild growth to compliant operations. As countries around the world tighten regulations on cross-border taxation, data privacy, and more, models that simply rely on policy dividends are no longer sustainable.

For Chinese sellers, this transformation may be a brutal reshuffle, but it also forces them to improve supply chain resilience; for platforms, localization and compliance will become the core barriers to future competition. In the second half of cross-border e-commerce, only those who proactively adapt to the rules and deeply integrate into the local ecosystem will be able to stand firm in this global game.