Inclusion in the Brazilian tax exemption program "Remessa Conform" is an advantage that most of the South American giant's cross-border retailers have.
Chinese e-commerce retailer Temu has been certified for a tax benefit program by the Brazilian government that exempts goods worth up to $50 from import duties, the country's federal revenue office said Monday in its website, which brings the company closer to expanding its business to the largest economy in Latin America.
Inclusion in the Brazilian tax exemption program "Remessa Conform" is an advantage that most cross-border retailers in the country have. Local media have reported that Temu has been preparing the groundwork for months to enter the Brazilian market, although few details are known so far.
THE CONTEXT AND THE RESPONSE
Temu is a popular shopping app from China's Pinduoduo. Its competitors Shein, from China, and Shopee, owned by the Singaporean Sea, are already large online shopping platforms in Brazil.
However, Temu did not immediately respond to a Reuters request for comment. Its website for Brazil said Monday that Temu services should be available "soon" in the South American country.
THE ATTRACTION OF TEMU
Notably, Temu is part of a new generation of Chinese companies that are revolutionizing the e-commerce landscape in Western markets. After debuting in the United States in September 2022, it is available in 56 countries through March, including our neighbors Malaysia and the Philippines. The platform generates US$2 billion in sales every month, a figure that continues to grow.
Other notable Chinese e-commerce companies today include SHEIN, which is now seeking an initial public offering (IPO) of up to $90 billion, and TikTok Shop, which top sellers tell us has clocked in at over $30 million. in sales in the United States last Black Friday.
CHINESE E-COMMERCE COMPANIES HAVE SOLD PRODUCTS TO THE WEST FOR A LONG TIME
With the largest consumer goods manufacturing base globally, cross-border e-commerce from China to the West is not new.
In the late 2000s, Chinese companies such as SHEIN, LightInTheBox and Globalegrow began leveraging online credit card payments and cheap logistics through postal services to sell products directly to consumers in the West.
The reasons were simple: good margins, easy to ship, and advertising on Google was cheap. These players later evolved into marketplaces or large independent online retailers.
Many other Chinese sellers took advantage of Western platforms such as Amazon Global and eBay's Global Buying Hub to sell their products in Western markets. Chinese e-commerce leader Alibaba also launched its global platform AliExpress in 2010.
Investors told The Lowdown that between 40 and 50 percent of Amazon's $490 million in third-party sales in 2022 came from Chinese sellers, either selling cross-border or through its registered entities and warehouses in the United States. Joined.
Global, regional and national platforms have been enlisting Chinese sellers to expand product variety at competitive prices. Amazon, eBay, Shopee, Wish, Uruguay's MercadoLibre, and Poland's Allegro run large seller onboarding and engagement teams in China.
However, many of these Chinese e-commerce companies have been struggling recently. LightInTheBox's share price fell more than 90 percent since its IPO, and Globalegrow closed in 2021 and was declared bankrupt by the court in 2023.
On the other hand, the trio of new entrants TikTok Shop and Temu, as well as the revamped SHEIN, have been advancing rapidly, disrupting the global e-commerce order.
