Cross-border e-commerce platforms have collectively raised prices in the U.S

Author | Huang Yu

Editor | Wang Xiaojun

Under the tariff war initiated by the Trump administration, American consumers are facing a "price surge" in their shopping, with even previously affordable online shopping becoming more expensive.

Following price increases on nearly a thousand products on the American Amazon website, two other cross-border e-commerce platforms from China, SHEIN and TEMU under PDD, have also raised prices on some products sold in the U.S.

On April 16, Wall Street Insight noted that both TEMU and SHEIN had sent price increase notifications to American users, stating that due to recent changes in global trade rules and tariffs, operating costs had increased, and the companies would adjust prices starting April 25.

Now that the deadline of April 25 has passed and the price adjustment policy has been implemented, many American netizens have lamented on social media that the items in their shopping carts have suddenly become more expensive overnight.

Some have found that a swimsuit on the SHEIN platform, which was priced at $4.39 on April 24, had already increased to $8.39 on the 25th, marking a price increase of 91%. Meanwhile, two patio chairs listed on TEMU, which were priced at $61.72 on the 24th, had risen to $70.17 by the 25th.

However, according to Wall Street Insight, the price increases on products on the SHEIN and TEMU platforms are not a widespread phenomenon. Perhaps the price hikes will be a gradual process.

In addition to TEMU and SHEIN, sellers on the international e-commerce giant Amazon have already begun raising prices.

According to SmartScout data, since April 9, nearly 1,000 products on the American Amazon website have seen significant price increases across various categories, including clothing, home goods, electronics, and toys, with an average price increase of nearly 30%. For example, the price of a power bank has risen from $110 to $135, an increase of over 20%.

This means that, as the Trump administration has eliminated the tax exemption for small import goods from China and imposed tariffs on Chinese products, companies are being forced to pass on costs to consumers.

The U.S. small-value tax exemption policy began in 1938, initially to facilitate tourists bringing souvenirs into the country (with a limit of $5), and has been adjusted multiple times, increasing to $800 in 2016, along with the T86 customs clearance model to simplify the process.

Professor Zheng Jichang, director of the China Service Innovation Research Institute, pointed out that in recent years, Chinese cross-border e-commerce has rapidly expanded thanks to this policy, with the number of tax-exempt packages reaching 1.36 billion in 2023, a 600% increase compared to 2015, drawing the attention of the U.S. government to tax loopholes and trade imbalances.

On April 2, Eastern Time, the U.S. announced the cancellation of the tax exemption for low-value imported products from China, known as the "small package tax exemption" policy for items under $800, marking another enforcement after a brief cancellation in February of this yearAccording to the latest tariff policy in the United States, starting from May 2, packages exported from China to the U.S. with a value not exceeding $800 will be subject to a tariff equivalent to 120% of the value or $100 per item; starting June 1, this will be further increased to $200 per item.

In recent years, leveraging the U.S. small package tax exemption policy, cross-border e-commerce platforms like TEMU and SHEIN have experienced a golden period of rapid expansion in the U.S.

Back in February 2023, TEMU, which had only been established for 5 months, spent $14 million to air a 60-second advertisement during the Super Bowl, the top event in the U.S. This not only set a historical high price for advertising during the event but also made TEMU the youngest brand ever to advertise in the Super Bowl.

In this event, known as the "American Spring Festival Gala," the slogan "Shop like a billionaire" quickly raised TEMU's profile in the U.S.

Relying on a fully managed model and low-price strategy, TEMU has become one of the most downloaded apps in the U.S. and has rapidly expanded its business to nearly 90 countries and regions worldwide. Reports have indicated that the U.S. is TEMU's largest market.

In fact, to reduce the potential policy risks associated with a high proportion of U.S. market share, some cross-border e-commerce platforms have been continuously increasing their investment in diverse markets in recent years, while also intensifying their localization strategies. For example, TEMU has been expanding its local supplier strategy in the U.S. over the past year, allowing sellers to ship directly from U.S. warehouses.

Wang Yujian, a special researcher at the E-commerce Research Center of the China Internet Network Information Center, stated that by increasing the procurement ratio from local U.S. suppliers or other regions not affected by tariffs, companies can effectively reduce the increased tariff costs caused by China-U.S. trade friction.

It is worth mentioning that under the current uncertain situation, TEMU and SHEIN have significantly reduced their advertising expenditures in the U.S.

Data from Sensor Tower shows that during the two weeks from March 31 to April 13, TEMU's average daily advertising expenditure on Facebook, Instagram, TikTok, Snap, X, and YouTube decreased by 31% compared to the average of the previous 30 days. During the same period, SHEIN's average daily advertising expenditure decreased by 19%.

In this global trade upheaval, the competition among cross-border e-commerce platforms has entered the second half, and only more refined operations may allow them to become one of the final winners.

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