Are you set up for success on Temu?

Temu has quickly emerged as a big player in the global ecommerce space, taking countries like the US by storm with its hard-to-resist low prices, huge product range, and engaging user experience.

Whether you’re a manufacturer or an e-commerce brand, Temu presents both opportunities and challenges. While selling on the platform can offer businesses a big global audience, there are trade-offs when it comes to pricing, brand differentiation, product content, and customer experience.

In this blog, we’ll unpack how Temu works, and what you need to know in advance before you decide if it’s a sales channel you want to include in your sales strategy.

What is Temu?

Temu is a Chinese e-commerce platform which launched in 2022; initially in the US before rapidly expanding into Europe and other regions. The brand’s ‘value-first’ mission is to directly connect global consumers with manufacturers so that they receive the lowest possible pricing on products.

Buyers can browse for items in nearly every major retail category on Temu — from kitchenware, electronic items, and clothing to home décor, toys, and gardening items. What’s more, it’s reported that these products can often be found at a price 30%-70% less than on comparable e-commerce sites like Amazon or Walmart.

How selling on Temu works

Temu’s business model is based on the idea that it removes all the intermediaries between a marketplace and the end customer. Instead, it assumes the role of buyer, merchandiser, and shipper.

Furthermore, besides hosting each seller’s set of product listings, the platform offers tailored assortments of recommended items to its customers.

Here’s how the selling process on Temu works:

1. To become a Temu seller, you must register via seller.temu.com. You’ll need to provide business documentation and evidence of your credentials. These Temu seller account requirements ensure platform quality.
   It should be noted that, while Temu allows individuals to open a Temu seller account, it prioritizes factory-direct wholesalers and sellers.
2. You’ll then need to upload product data to Temu’s seller portal. This product information includes aspects like titles, product descriptions, images, SKU information, specification, sizing, or dimension-related data, and pricing. All of these elements can be stored and managed most efficiently via a modern Product Information Management (PIM) platform for e-commerce.
3. Temu fulfils the order centrally. As the seller, you’ll need to bulk-ship your products to a Temu warehouse — often based in China — so that Temu can fully handle the logistics when items are sold. This approach allows Temu to monitor their inventory more effectively and, in theory, offer a better level of customer service to consumers. The drawback for you as the selling business is that you’ll have much less control over how your goods are packaged and delivered.

Temu seller fees and commission rates

Temu doesn’t charge upfront Temu seller fees to businesses. Instead, the Temu seller commission rate applies to every sale, and this is typically at a rate of between 5% and 20%. The proportion of commission you pay on these Temu selling fees depends largely on aspects like the product category your item is in and its margin ‘profile’.

Which product categories perform best on Temu?

Like all online selling, once a consumer is looking at your product listing, sales success depends heavily on factors like product content quality, price, and customer reviews. However, on Temu, there are certainly some product categories that tend to shift more units.

These include:

• Fashion and general clothing: e.g. loungewear, accessories, leggings, oversized sweaters, and t-shirts.
• Home decor and kitchenware: e.g. organizers, kitchen gadgets, bedding, and Tupperware.
• Consumer electronics and accessories: e.g. USB chargers, gadgets, cables, Bluetooth earphones, adapters, and phone cases.
• Beauty and personal care: e.g. skincare tools, makeup brushes, fae masks, and travel-friendly items like toothbrush cases.

The benefits of selling on Temu

Here are just some of the advantages of selling your products on the Temu platform:

In general, product listings that strike the right balance between quality and price stand the best chance of converting a browser into a customer.

• You won’t pay any upfront listing fees — you can upload and list your products and see how they perform first, which reduces the risk to your business’s finances.
• Temu takes care of all order fulfilment — their model means that your business won’t need to spend time picking, packing, and shipping items — which potentially saves time and money.
• Your audience reach extends into global markets — selling on Temu gives you the ability to automatically tap into markets like the US, UK, France, and beyond — all without needing a direct retail presence in those regions.

The drawbacks of selling on Temu

Here are some of the key challenges you might want to consider before opening a seller account on Temu:

• Meeting all Temu seller account requirements can be complex for smaller businesses
• Temu controls most of the product experience on the platform — this means that your business has far less ownership over how your brand is represented, positioned, and even reviewed.
• Temu customers have high expectations when it comes to receiving what they’ve paid for — and that means that product images, descriptions, and specification details should match items exactly, or your brand risks a higher rate of product returns and poor customer reviews.
• You’ll be operating in a low-margin environment — to truly compete on Temu, your brand must offer consumers ultra-competitive pricing. This can work for businesses that produce enough units to benefit from economies of scale but carries more of a risk for smaller brands.
• Brand perception may be affected  — for higher-end brands, selling on a discount marketplace like Temu carries the possibility of eroding their brand value.

Is Temu the right sales channel for your brand?

There are many factors to consider before you decide whether Temu is the right sales channel for your brand and its products:

• Does it make business sense for your products to be priced ultra-competitively?
• Are you selling products that aren’t subject to high levels of regulation?
• Can you meet all Temu seller requirements for product data and fulfillment?
• Are you prepared for the Temu seller commission rate structure?
• Do you have a flexible supply chain?
• Do you want to expand your business into international markets?
• Is Temu’s low-margin/volume-based business model compatible with your business?
• Are you comfortable with the idea of having less control over how your brand is presented (e.g. brand content, brand story)?

In a nutshell, there’s more to selling on Temu than just competing on price — your business needs to be operationally ready and agile enough to create accurate, relevant, engaging product content quickly and efficiently.

Time to give Temu a try?

While Temu is proving to be an increasingly popular sales channel for price-sensitive consumers, e-commerce businesses need to carefully consider whether the platform will be a good fit for their products and brand.

And while Temu can take on much of the logistical ‘heavy lifting’ for sellers, it does not remove the burden of getting your product information in order for the platform. That’s where a PIM system like Inriver can really help.

With Inriver PIM, e-commerce sellers can centralize all of their product data, localize content at scale, and remain agile in Temu’s world of high-volume selling — and all without compromising product content quality or customer trust.