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Temu's semi-managed model could change everything
- hedora 2y agoThere’s a lot of text in the link, but not on the subject in the title: > However, the remainder of the report, including the exploration of the merchant situation, the semi-managed model and Temu’s profitability, is a premium offering exclusively for our paid subscribers,
- aaron695 2y ago[dead]
- somedudetbh 2y agoI don't know much about this space, but does anyone else think there's a non-zero chance that PDD/Temu is a massive fraud of some kind?
- insane_dreamer 2y agoI, for one, don’t trust it one bit.
- kylebenzle 2y agoYes, it was the same with FTX and in both cases it turns out it was probably the CEO being in bed with regulators.
- looppp 2y agoYou guys realize that Temu is backed by Pinduoduo, one of the largest e-commerce startups in China/theWorld right? At least you admit you don't know much about the space, though.
- dkarras 2y agohow does being backed by something big in China makes it less scammy?
- seanhunter 2y agoAre you saying that because they are backed by a big startup they can't be a fraud? China has a big problem with financial fraud of various kinds partly because of rapid growth and partly because of how regulation is shared between Beijing and the regions meaning some things fall between the cracks. https://www.ft.com/content/77f61cf0-5b9d-4ea8-854a-4f220039dcb7 https://www.ft.com/content/77f61cf0-5b9d-4ea8-854a-4f220039d... Some recent examples: Evergrande - one of the biggest property companies in China. Also, a fraud https://www.bbc.com/news/business-68603195 https://www.bbc.com/news/business-68603195 Sino Forest - Massive. Listed on the Toronto stock exchange. A fraud https://moneyweek.com/economy/people/601220/great-frauds-in-history-allen-chan-of-sino-forest https://moneyweek.com/economy/people/601220/great-frauds-in-... Lantian Gerui - Fast-growing investment company, 100s of thousands of investors. A fraud. https://www.ft.com/content/605a7ca9-3f5f-47e6-ab5c-818b9a1bf0d5 https://www.ft.com/content/605a7ca9-3f5f-47e6-ab5c-818b9a1bf... Pinduoduo themselves have been accused of using improper accounting practices to hide losses and inflate revenues https://www.ft.com/content/314a56d0-e899-11e8-8a85-04b8afea6ea3 https://www.ft.com/content/314a56d0-e899-11e8-8a85-04b8afea6...
- resolutebat 2y agoEvergrande sold promises of houses, FTX and Lantian sold promises of huge investment gains. But if you buy something on Temu, it's actually delivered to you in a week. The worst case is that the unsustainable growth is propped by VC money, like the early days of Uber, but the consumer is still the one that's profiting here.
- seanhunter 2y agoNot sure the consumer is winning here. Eg the UK consumer advocacy organization "Which?" tested 3 electric heaters ordered on Temu and found all three unsafe[1]. The US bbb has them at a "C+" rating due to complaints about goods being ordered but not arriving etc[2] [1] https://www.which.co.uk/news/article/what-is-temu-and-is-it-safe-to-buy-from-a7BUb4k5fBFH https://www.which.co.uk/news/article/what-is-temu-and-is-it-... [2] https://www.bbb.org/us/ma/boston/profile/online-shopping/temucom-0021-553943 https://www.bbb.org/us/ma/boston/profile/online-shopping/tem...
- dawnerd 2y agoRight I think you should read up on it before assuming others don’t know. https://krebsonsecurity.com/2023/03/google-suspends-chinese-e-commerce-app-pinduoduo-over-malware/ https://krebsonsecurity.com/2023/03/google-suspends-chinese-...
- somedudetbh 2y agoWhat did you think I meant by "PDD/Temu"?
- ars 2y agoI personally think Temu is just a way to convince people to install their app, and the products are sold at a loss. I refuse the app and order only via website.
- nerdponx 2y agoThis wouldn't surprise me. Almost the entirety of Facebook/Meta and Google products are loss leaders for ad tech. Why not a shopping site?
- PradeetPatel 2y agoPotentially because it is owned by a Chinese firm. To my knowledge, China has a very diverse and relaxed law around data privacy.
- malcolmgreaves 2y agoI used Temu once. My order had two packages. One package never arrived. Temu support was unwilling to refund and could not tell me where that package was. They said it shipped and would be arriving "soon." Months later, it is still "soon." It's either willful fraud or willful negligence. re: stickiness -- This is undoubtably because they hyper-gamify the shopping experience with fake "deals" you can "win." It looks like you get a random deal / discount with a wheel-of-fortune like thing. I don't believe this is actually random in any faithful sense of the word. However, it does feel like you're special. I'm not surprised that this gimmick works on a large swath of the population. Particularly, as this report cites, Boomers, who yearn for the yesteryear when they were the special ones.
- lynx23 2y agoNot wanting to defend Temu in particular, but the package delivery system error rate situation is getting out of hand. Its became a small-talk topic. everyone can tell a tale of packages not being delivered properly, and them having to hunt the package down manually, sometimes going from shop to shop. For me personally, the error rate was recently so high that I actually gave up on ordering anything from the Internet for a while. The frustration and the anticipation of having to deal with finding my package was so high that I can't do it anymore, at least for a few months. Its no longer convenient, its the opposite.
- ars 2y agoI had the opposite experience - the package came, but they never updated the tracking to say so. Temu emailed me to give me $5 because my package was late. There was no place to tell them that it came. A few weeks later they automatically gave me a refund for my "missing" package, and likewise I didn't see anyplace to tell them it had arrived. I did not contact support because that probably costs them more than the value of what they sent me.
- deleted 2y ago[deleted]
- jdkee 2y agoThe USPS is subsidizing the Chinese with shipping into the U.S. See https://www.forbes.com/sites/wadeshepard/2017/11/05/how-the-usps-epacket-gives-postal-subsidies-to-chinese-e-commerce-merchants-to-ship-to-the-usa-cheap/?sh=4a50c09140ca https://www.forbes.com/sites/wadeshepard/2017/11/05/how-the-...
- deleted 2y ago[deleted]
- llboston 2y agoOn top of that, Temu doesn't pay import tariffs. https://www.npr.org/2024/03/28/1241357550/import-tariff-loophole-helps-online-shopping-site-temu-offer-low-prices https://www.npr.org/2024/03/28/1241357550/import-tariff-loop...
- hedora 2y agoThey also use forced labor. I’m guessing the missing part of the article about “semi managed” explains how modern tech platforms and an innovative business model lets them undercut Amazon. https://www.bbc.com/news/business-67752413 https://www.bbc.com/news/business-67752413
- dawnerd 2y agoI thought this was scaled back? https://thehill.com/opinion/finance/418081-usps-is-done-subsidizing-chinese-package-shipping/ https://thehill.com/opinion/finance/418081-usps-is-done-subs...
- wholemodern 2y agoit's an outrage that USPS is subsidizing temu/shein/aliexpress to ship toxic/cancerous items from China to kids. Temu’s products, like those of its peers, harbor these toxins. In fact, Health Canada revealed that a Shein children’s jacket contained more than 20 times the allowable amount of lead for children’s products. https://www.washingtonexaminer.com/opinion/2854161/temu-dark-side-discount-shopping/ https://www.washingtonexaminer.com/opinion/2854161/temu-dark... Seoul gov't finds carcinogens in children's products from Temu, AliExpress https://koreajoongangdaily.joins.com/news/2024-04-25/national/socialAffairs/Seoul-finds-carcinogens-in-childrens-products-from-Temu-AliExpress/2033730 https://koreajoongangdaily.joins.com/news/2024-04-25/nationa...
- Mengkudulangsat 2y agoOver time the ecommerce space is going to demarcate into two segements:- [1] High value, high trust purchases that really neeeds to arrive and for warranties & customer service to work. [2] Crap; where you buy on impulse, forget immediately and become surprised when they actually arrive. TEMU is about #2
- nerdponx 2y agoBrands with reputations for being in category 1 are increasingly eager to provide products on par in quality with category 2 (or marginally better), basically sucking what value is left of the brand reputation until there's nothing left and the execs/shareholders walk away with a couple of new yachts.
- danpalmer 2y agoI think this is both happening because supply chains are becoming so cheap, and then being reinforced by increasing wealth disparities. There are many people in the US for whom Amazon is too expensive, and as local businesses shutter because they can't compete with online retailers, their only choice is places like Temu.
- CosmicShadow 2y agoThis is the company whose instagram ads show ridiculous stuff for like $17 and you think this has to be a scam, right? And their biggest market is boomers and gen x, those still most likely to fall for the scam or just say fuck it and order because they have income? And some how Temu is 10% of Meta's revenue, which tells you something. I'm sure many of us have ordered from the el'cheapo Chinese 1 penny drop shipping sites and found out how you are getting like sub-dollar store quality, mostly broken or malware infected junk that might show up 6 months later to know better to bother trying again, but with that much advertising they are casting a wide net of folks who will keep falling for their ads. Also telling how much of their market is folks who make under 50k/year.
- geoffmunn 2y agoI have ordered lots of stuff off AliExpress and it's been a roughly 50% success rate. Some things were clearly low quality, one item was completely wrong, but the rest were surprisingly good. For me, half the fun is the anticipation of it showing up and maybe getting a good item. I do struggle with the throw-away mentality though - some reasonably sophisticated technology goes straight in the bin when it fails.
- treme 2y agoYo boomer, Temu is solid for price on average. They do their own sourcing and place order direct to factory at 0.6% margin. I'd guess 80% of things you get from Amazon comes from similar tier or same factories that provide for TEMU.
- resolutebat 2y agoWhat's ridiculous is not the item that costs $10 at the factory gate and is sold at $17 on Temu, but that Amazon dropshippers want $170 for it. I've personally purchased an item that's $2 (two) when purchased in bulk on Alibaba, is sold for $400 at brick and mortar shops, and was delivered to my doorstep in a week for $20 by Temu.
- er4hn 2y agoThis would be more fun if you could share what that item is.
- 55555 2y agoThis free article preview is missing the entire section on the semi-managed model, which is a shame, as it sounds very interesting.
- kkfx 2y agoFew personal notes: - I use Temu, Amazon, Aliexpress, ... simply because I look for something everywhere and decide where to buy, it THE SAME thing built in THE SAME factory is on sale on three shop of course I'll choose the cheapest if it's not urgent, the fastest otherwise simply because; - I know ALL shops have TERRIBLE policies for their customers, yes, Amazon is the best for returning things and get refunds, IF anything going well, I have had very few returns, some was well, some was not and reaching a solution locked in a set of automated procedures that does not lock only myself but also Amazon's workers was a nightmare. So if the vendor treat me like a cow for milk why I would have to treat it better? - most cheap stuff are manufactured in China OUR entrepreneurs have chosen that, there is no reason to pay an intermediary. I get no more guarantee in the present world. If our platforms want to live they need to came back respecting and protecting their customers, if not they are just commodities like any others. BTW here in EU Temu have slow down it's deliveries while Aliexpress is less and less slow than before, meaning now it's more competing than Temu in various cases, Amazon meanwhile have deeply rise it's prices and lower it's quality, there are still much thing not present on Chinese vendors sites, but it's in a deep decline and the push toward services accelerate that.