Why is Temu so cheap? This is the strategy of the Chinese giant which is winning more and more customers

Have you received an invitation from one of your friends to create an account on Temu ? Currently, Many Chileans are already buying products on this page China which offers all kinds of products very affordable and with positive reviews that captivate everyone.

So much so that the prices of some basic items could be much lower than those of Aliexpress or even Amazon and Mercado Libre.

But, why is Temu so cheap? A recent investigation into BBC explains who is behind this giant business.

To begin to understand Temu’s success, you need to know that This business is part of PDD Holdings which according to the founder of China Market Research Group , Shaun Rein , It is “a monster of Chinese e-commerce”.

The expert told BBC Mundo that In China, everyone buys their products, “from speakers to t-shirts or socks”. In this sense, he assured that the Chinese are very proud of the company, capable of “killing the dragons of e-commerce in the United States, like Amazon.”

Its biggest competitor at the moment is Alibaba, which is the most listed Chinese company on the American stock exchange. But Temu is already fighting for leadership, reaching a value of $150 billion.

At this rate, it has spread throughout the world, including Latin America. Temu enjoys success in Chile, Mexico and Colombia.

And the reason for its cheap prices is, according to the same media, that it sells “unbranded products”. This is their great strategy: to sell directly from the factory to the consumer, avoiding additional expenses, such as storage. Something similar to what fast fashion company Shein does.

“At Temu, they understand that consumers, in these times of inflation and turbulent economy, are looking to buy cheap products” the analyst said Neil Saunders at the BBC. “And the platform allows companies to sell their products at a tenth of normal prices, directly accessing consumers around the world.”

But you don’t have to be one hundred percent sure. Despite a great offer and countless positive reviews, most products are not of good quality and therefore do not last long.

Despite its great success with consumers in many countries, The American government becomes suspicious of Temu and opens an investigation. After that, he said there is “an extremely high risk” that the products they sell are made using forced labor.

In parallel, The company’s website states that it “strictly prohibits” the use of forced labor, whether of prisoners or children, by all its merchants. This would be an essential requirement for businesses that want to sell their products on Temu.

Furthermore, other countries, such as France, have indicated that Stores like Temu or Shein “harm the environment and the economy, in addition to encouraging impulsive buyers”. This is why they are prohibited from advertising certain similar companies and even asking them for annual fees to “compensate” for the damage.