Amazon has recently been working on launching a new discount marketplace with ultra-cheap products shipped directly from China to rival the likes of Temu and Shein, two massively popular Chinese stores selling dirt-cheap items. According to a report from The Information, the e-commerce giant was recently seen sharing information with its merchants on price caps that it’ll set for select products.
The list totaled 700 items. Some price caps include $8 for jewelry, $9 for bedding, $13 for guitars, and $20 for sofas. Amazon doesn’t operate on a price cap system for its primary marketplace, so this is an entirely new approach it’ll be experimenting with on the new store. The products will be shipped from a fulfillment center in Guangdong, China.
Reportedly, the shipping timelines will be around nine to 11 days, and sellers will be charged between $1.77 and $2.05 for shipping a four to eight ounce item from the center. The Information compares these figures to the $2.67 to $4.16 fee that sellers pay for shipping items of the same weight from local warehouses under Fulfillment by Amazon.
One of the biggest issues with such Chinese stores, apart from incredibly poor quality offerings, is the labor exploitation model they’re built on. The Select Committee highlighted in a report that Temu sends millions of shipments to the U.S. every year containing products made by Uyghur Muslims under forced labor. It added that Temu doesn’t do anything to ensure compliance with the Uyghur Forced Labor Prevention Act (UFLPA) or any other policies around exploitative labor.
As mentioned in the report, “[…] all the companies operating in the United States have an obligation to clean up their supply chain and ensure that they are not contributing to the […] genocide of the Uyghur people by facilitating the sale of goods made with forced labor.” But given the already exploitative labor model that Amazon operates on and how ridiculously abusive it is with its workplace policies, it’s highly unlikely that it’s going to take a different, more ethical approach with its budget store.
What can you expect from a $20 sofa? Poor aesthetics and a flimsy build. They’re often stuffed with toxic levels of lead as an unethical shortcut to enhance the colors, add some heft, and make them resistant to corrosion. This makes the thought of a $13 guitar way more concerning than it sounds.
Temu and Shein haven’t just made Amazon feel insecure with their explosive success. Last year, TikTok responded to the competition by launching an in-app shopping function exclusively for the U.S. to sell cheap Chinese-made products.
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