Amazon wants to attack Temu and Co with its low-cost division
According to media reports, Amazon is working on a new section for cheap goods from Chinese sellers in its online store. US customers are expected to be able to purchase inexpensive clothing for under $20 more quickly in the future.
In light of increasing competition from discount platforms Temu and Shein, Amazon plans to launch a new section in its online shop: Chinese sellers will be able to deliver goods directly to US customers, as reported by the American broadcaster CNBC. At a dealer event in China, Amazon presented these plans. US customers will be able to order affordable fashion and lifestyle products in this new category.
According to the presentation, unbranded products will be offered, many of which cost less than $20. For example, a massage device and phone cases were shown. The goods are expected to be with customers within nine to eleven days. Sellers could start with small quantities and increase production when demand is high - in other words, "on demand" production like Shein.
Previously, sellers from China shipped their goods to Amazon warehouses in the US, from which they were then sent to customers. The sale is now expected to not only be faster but also cheaper. Amazon had already lowered fees for sellers who sell clothing for under $20 on its platform, according to the report. The number of items sold by Chinese sellers was said to have increased by a fifth last year, according to Amazon's statements.
Exact details on when Amazon's discount section will launch are unclear. The first corresponding products are expected to be accepted starting in the fall. An Amazon spokesperson told CNBC, "We are always looking for new ways to work with our selling partners and delight our customers with a greater selection, lower prices, and more convenience." Previously, The Information had reported on Amazon's plans.
The new section in Amazon's online shop, as revealed during a dealer event in China, will allow Chinese sellers to deliver goods directly to US customers, thereby bypassing previous methods that involved shipping goods to Amazon warehouses in the US. This new section is anticipated to offer a range of unbranded products, many of which will cost less than $20, including items like massage devices and phone cases, and is expected to facilitate faster and cheaper online shopping for US customers. This move could potentially intensify competition within the online trading market, as Amazon looks to emulate the success of discount platforms like Temu and Shein.
