Shoppers in the United States are bracing themselves for higher prices from Chinese e-commerce platforms such as Temu and Shein may soon see those fears realized as both companies prepare to raise prices ahead of newly imposed punitive new tariffs.
Fast-fashion giant Shein and Temu, operated by PDD Holdings, have notified U.S. shoppers of impending price rises due to take effect from April 25. While neither company has disclosed the scale of the increases, the announcement comes before the official May 2 cancellation of the de minimis treatment for small parcels, a policy change formalized by President Trump on April 2. The exemption previously allowed packages valued at under $800 to enter the U.S. duty-free, forming a cornerstone of the ultra-low-price models adopted by many Chinese e-commerce operators that ship directly to American consumers.
As part of Trump’s sweeping tariff policies, small parcel shipments from the Chinese mainland and Hong Kong face tariffs as high as 120% or a flat fee of $100 to $200 per package from May 2, after several hikes in response to Beijing’s retaliations. The tariffs will be further increased from June 1.
The tariff escalation threatens to disrupt China’s booming cross-border e-commerce sector. Platforms such as Shein, Temu, Alibaba’s AliExpress and TikTok Shop have built rapid-growth models around this “full-service” approach of shipping low-cost parcels direct to U.S. shoppers — managing everything from listings and logistics to after-sales support for small merchants.
Both Shein and Temu are urging merchants to adapt. Shein is helping vendors adjust U.S. prices, expand into non-U.S. markets and shift toward semi-managed services where sellers handle logistics. Temu has introduced tools to help sellers migrate to semi-managed storefronts, touting benefits such as lower platform fees.
Merchants remain in apprehension, however. One Temu seller told Caixin that semi-managed models risk creating new inventory burdens and lack pricing control, making platforms such as Amazon more attractive.
In anticipation of price rises, U.S. shoppers appeared to be stockpiling goods, boosting sales significantly in early spring. Bloomberg Second Measure data showed Shein’s U.S. sales surged 28.6% year-on-year in March, jumping to 37.5% in early April. Temu saw even steeper climbs of 46.3% and 59.6% in the same periods.
However, early signs of a slowdown are emerging. Both Shein and Temu slashed U.S. social media ad spending in early April, according to Sensor Tower data cited by Reuters. At the same time, their rankings in U.S. app stores have fallen. Multiple Temu vendors told Caixin that they’ve seen a sharp drop in traffic and sales beginning around April 7, which they put down to reduced platform promotion. Many are adopting a wait-and-see approach as the new tariff landscape and platform policies materialize.
As Shein and Temu begin to adjust prices, industry analysts say rivals such as Amazon and independent cross-border sellers could benefit. “When low-price leaders like Temu and Shein raise prices, others gain room to hike theirs too,” said Lu Cong, CEO of Shenzhen Topology. He added that passing costs on to U.S. shoppers might prompt a reconsideration of tariffs.
Contact reporter Han Wei (weihan@caixin.com)
