This Could Be a Big Blow for Temu, and a Big Win for Amazon
Shopping on cheap e-commerce sites such as Shein and Temu (which PDD Holdings owns) can be alluring for bargain hunters looking to save money. Paying just a few dollars for clothes and other items can make it easy to justify waiting for a package to arrive rather than paying more money for quicker delivery via Amazon (NASDAQ: AMZN) or another retailer.
By pricing products aggressively low, Chinese e-commerce sites generate impressive sales numbers and become among the most popular shopping sites in the U.S. But changes could soon alter the ability for those sites to continue offering extremely low-priced goods. That would be welcome news for Amazon and companies that may be struggling to compete against Temu and Shein.
Many Chinese e-commerce platforms and retailers have benefited from a loophole that allows them to bring low-cost goods into the U.S. without having to pay costly tariffs. Doing so enables them to keep their prices low, often much lower than Amazon and other sites can. If packages are coming in at less than $800, they are able to avoid scrutiny and the tariffs that accompany more valuable shipments. This is known as the "de minimis" provision.
Source Fool.com
