‘Where the world goes’ temu, with questionable methods, conquering Europe

Compiled 8 February , updated 12 April 2025

The e-commerce war with China has long been part of the global competitive scenario.

This is happening everywhere, even in Europe, with local marketplaces.

The only exception is Italy where, unfortunately, the field has been left to Amazon.

In China, as the online sales site Temu crushes prices and manufacturers

The platform attracts millions of users. It also creates much discontent in the small Chinese factories that supply it. The reason for this are its aggressive practices in the price war between the major e-commerce players.

On the ground floor of the wholesale building, Huang Yao’s showroom is the most visible. The light stays on until late at night. This owner of a textile workshop in the city of Guangzhou, China, runs her business while drinking tea. On the shelves around her desk are jumpers of all colours, from plain brown to red and white stripes, she herself prefers to wear a black blouse. She works with a number of online sales platforms: Shein internationally, the Douyin app – the Chinese version of TikTok – or the Kuaishou website domestically.

But talk no more about Temu, it’s over. It started, like tens of thousands of producers and sellers, but quickly became disillusioned. He stopped a little before the summer. “Their rules are not winning for us. They should review the way they operate,’ says the woman, as outside the last handlers park their mechanical carts for the night.

As much as it converts millions of new users worldwide, the Temu site creates discontent in the small Chinese factories that supply it. The reason for this is that its particularly aggressive practices in the current price war between online sales platforms, including Shein and AliExpress [of Alibaba] leave barely enough margin for the factories to survive.

In addition, Temu imposes expensive ‘fines’ on sellers if the customer is not satisfied with the product, if deadlines have not been met, or if there has been a shipping error. They can amount to several times the selling price of the product and are deducted from the payments the suppliers should have received.

A resounding success in the US and France

In addition, the platform, first in its original Chinese version, Pinduoduo, was the initiator of a practice whereby unsatisfied customers leave the product with a full refund. Suppliers find it unfair not to recover their product or part of the cost and have to pay even more with these fines. Especially since Temu’s promise to ‘buy like a billionaire’, while making it cheaper and cheaper, contributes to a reduction in quality. “I didn’t realise this until I started with them,” ^{says Huang}, who also complains about late payments.

With its extremely low prices, the app is a resounding success. Since 2023, and still today, it is the most downloaded shopping app in the US and France. But suppliers are organising themselves to denounce its methods. Dozens, perhaps even hundreds, of them demonstrated in front of the group’s headquarters in Shanghai on 10 December. Similar mobilisations took place during the summer in front of the company’s offices in Guangzhou, around which many small textile manufacturers are located.

Li, owner of a workshop in the city, was among the organisers of the July protests. He explains that it took him a few months, after the launch on Temu, to realise how the fines were eroding any profit. At the same time, however, it was necessary to constantly reduce the prices offered in order to remain competitive. Because as soon as a product is successful, another seller offers more or less the same product but cheaper, only a few days later. “I used to employ a hundred people, but I could only maintain about sixty. I am reduced to borrowing to maintain the production line,’ he says. I know more than a dozen traders who have had to close their doors. “

Together with many others, this man, who considers it preferable not to publish his full name, went to protest in front of Temu’s nearest offices in Guangzhou. There were perhaps 500 of them on the second day of the mobilisation. Some were detained for several hours by the police. On the third day, officers arrived at the hotel, where the protesters were gathering, before they even left for the Temu offices.

“Destructive ‘revolution

Among those who did not object to the app’s methods^{was Lin,} a wholesaler, who said she was fined 1.4 million yuan (about 184,000 euro) by the platform for unsatisfactory products, which forced her to stop production. “I lost myself. I don’t know what to do next, because the Chinese domestic market is also extremely competitive,’ she describes. “All policies put in place are aimed at ensuring the safety and satisfaction of Temu users and do not affect the vast majority of sellers on the platform,” comments a Temu representative in France.

The Chinese authorities have not turned a deaf ear to this growing anger, even if those demonstrating are intercepted by the police. In July, the all-powerful political bureau of the Chinese Communist Party warned of the destructive‘involution’ caused by the price war in Chinese industry. The Bloomberg news agency revealed on 11 December that the Chinese Central Market Regulatory Administration summoned the executives of the parent company, Pinduoduo. It demanded that they solve the problem posed by the seller’s policy of full refund of the product, without requiring the customer to return it, because it places an unfair burden on the factories.

Temu’s methods also provoked a reaction from the Old Continent, which on 31 October opened an investigation into the number of products not conforming to European Union (EU) standards on the platform: from toys with dangerous parts for children to counterfeit pharmaceuticals and cosmetics. The EU is particularly concerned about the very rapid reappearance of sellers or products that should have been banned, suggesting a lack of serious oversight by the platform.

Criticism from billionaires

The Pinduoduo app was launched in 2015 by an engineer, Colin Huang, who first worked for Google. While the giants Alibaba and Jingdong were already dominating e-commerce, aimed mainly at young people in China’s big cities, Huang’s app offered group purchases aimed more at the more modest, price-sensitive inhabitants of secondary cities, even on everyday consumer products or foodstuffs. The group buying effect contributed to Pinduoduo’s virality – users will solicit friends and family for significant discounts – and products are offered by the algorithm in the manner of an addictive social network, rather than an online shopping site. Its international version, Temu, was launched in the US in September 2022 and has become widely known for its rewards, including commercials during the Super Bowl.

Colin Huang had become the richest man in China in August. But the announcement of less positive results than expected meant that he lost this title twenty days later.

Temu’s practices earned Huang criticism from his fellow billionaires. In a speech on 20 November, Zhong Shanshan, the head of bottled water Nongfu, which has regularly been the country’s biggest fortune in recent years, denounced ‘online platforms that have reduced prices, especially Pinduoduo’s pricing system’.

“They are a huge nuisance for Chinese brands and industries,” Zhong said.

Harold Thibault (Guangzhou (China), special correspondent)