Amazon has recently been working on launching a new discount marketplace with ultra-cheap products shipped directly from China to rival companies like Temu and Shein, two hugely popular Chinese stores that sell very cheap items. According to a report by The informationThe e-commerce giant was recently seen sharing information with its merchants about the maximum prices it will set for select products.
The list totaled 700 items. Some price limits include $8 for jewelry, $9 for bedding, $13 for guitars, and $20 for couches. Amazon doesn’t operate a price cap system for its main marketplace, so this is a completely new approach you’ll be experimenting with in the new store. Products will be shipped from a fulfillment center in Guangdong, China.
Shipping times will reportedly be between nine and 11 days, and sellers will be charged between $1.77 and $2.05 to ship a four- to eight-ounce item from the hub. The data compares these figures to the $2.67 to $4.16 fee sellers pay to ship items of the same weight from local warehouses under FBA.
One of the biggest problems with these types of Chinese stores, apart from the incredibly poor quality offers, is the labor exploitation model on which they are based. He select committee A report highlighted that Temu sends millions of shipments to the United States each year containing products made by Uyghur Muslims subjected to forced labor. He added that Temu does nothing to ensure compliance with the Uyghur Forced Labor Prevention Act (UFLPA) or any other policy around labor exploitation.
As mentioned in the report, “[…] All companies operating in the United States have an obligation to clean up their supply chain and ensure that they do not contribute to […] genocide of the Uyghur people by facilitating the sale of goods made with forced labor.” But given the already exploitative labor model that Amazon operates in and how ridiculously abusive it is with its workplace policies, it’s highly unlikely that it will take a different, more ethical approach with its budget store.
What can you expect from a $20 sofa? Poor aesthetics and flimsy construction. They are often filled with toxic lead levels as an unethical shortcut to enhance the colors, add some weight and make them corrosion resistant. This makes the idea of a $13 guitar much more worrying than it seems.
Temu and Shein have not only made Amazon feel insecure with their explosive success. Last year, TikTok responded to the competition by launching a US-only in-app purchasing feature to sell cheap products made in China.