Amazon has had Chinese cross-border marketplaces such as Shein and Temu in their periphery more than what they will admit to. Chief Executive Officer Andy Jassy indirectly mentioned the companies when he referred to “cost to serve” in his annual shareholder letter. Amazon adding a dedicated discount store on its marketplace for Chinese goods that are cheaper and shipped at slower speeds enable them to play both offence and defence to competitors.
A decade ago, no marketplace would think about launching in the US, Germany, UK and emerging markets such as Brazil as in all cases a market leader exists. The four Chinese Dragons – Shein, Temu, TikTok Shop, and AliExpress are all connecting customers to Chinese manufacturers who have factories that are idle and are in need of orders to drive revenues and be able to pay salaries to staff. Cross-border e-commerce has evolved from being a niche to a direct competitor to marketplaces in global markets in offering customers access to cheap goods made in China shipped in days instead of hours to consumers.
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