Temu products are so inexpensive because of their unique business model. Temu connects buyers directly with manufacturers, cutting out the middlemen. This reduces extra costs, allowing them to sell products at lower prices while still making a profit.
Temu’s pricing strategy focuses on competing in the North American market. They keep prices low to stand out against big names like Wish and Walmart. Even with small profits per order, the high volume of sales brings in significant revenue.
Most of Temu’s products come from China, where production and labor costs are lower. This helps reduce the overall cost of goods, enabling them to offer cheaper prices to consumers.
Efficient logistics and delivery also play a role. Temu works with well-known logistics and payment providers to ensure cost-effective delivery. They offer a delivery guarantee and extended returns, which helps keep costs down further.
Lastly, many items on Temu are knockoffs of popular products. These unbranded duplicates are cheaper to make and source, allowing Temu to sell them at lower prices. Combining these factors, Temu provides budget-friendly options for cost-conscious shoppers.