1 week Ago By Varun Godinho
Temu and Shein which primarily sell ultra-cheap Chinese goods to consumers around the world may soon see its business hit significantly due to the tariffs imposed by President Donald Trump on China. In the latest round of a trade war between the two countries, Trump has raised tariffs to 125% on China, after China retaliated with 84% tariffs on US imports. Imports to America under $US800 ($1333) will now incur a duty tripled to 90% of the order value from June 1.
Companies such as Temu and Shein are affected by the latest tariffs due to the volumes of their products coming out of China. Some Australian retailers now set to benefit as the two Asian e-commerce platforms which have made deep inroads into the Oz market may now see their business models shaken. A drop in exports from China to the US could mean lower shipping container prices overall, something which will benefit Oz retailers .
“Now you can look at it and wonder what will happen to container prices? We are watching that too, and it is more likely that it will be cheaper than more expensive,” Harvey Norman chairman and co-founder Gerry Harvey told The Australian. Harvey added that it was too early to tell if suppliers would come to the negotiating table willing to reach new deals. “That discussion will happen, and it won’t be just us, it will be every retailer doing that right across the board everywhere,” said Harvey.
“We are in the very beginning of that, now whether that eventuates or what happens, who knows, and how quickly does Trump or doesn’t he reverse? I think most of us are sitting here thinking he is a deal-maker, he will reverse and do deals. But does he? Both sides have to agree, and it won’t happen overnight,” said Harvey. The chief executive of consumer electronics giant JB Hi-Fi, Terry Smart, too has reportedly not yet heard any feedback from suppliers yet about the opportunity for lower prices.
Harvey had earlier this year called for a government inquiry into Shein and Temu. “(Shein and Temu) are a ..
. pariah, it’s a very difficult situation for Australian retailers to combat,” he told The West Australian paper. “They never pay any tax here, they don’t employ anyone.
There should be a government inquiry into it as to what ramifications are there and whether they should or shouldn’t do something about it.” E-commerce platforms such as Kogan also stand to directly benefit from any hit to the business at Temu and Shein. Shein and Temu first entered the Australian market in 2022 and 2023 respectively and have seen rapid success since then.
Data from Roy Morgan in August last year indicated that 3.8 million Australians aged 14+ bought at least once from Temu over 12 months, while 2 million bought at least once from Shein. “We’re already seeing suppliers and manufacturing partners divert stock and capacity away from the US, and it’s pushing prices down.
With the US being the world’s largest economy and a key driver of global demand, these tariffs are leaving many factories in major manufacturing hubs like China scrambling to fill the gap, and it’s driving prices down,” said Kogan.com founder and chief executive Ruslan Kogan. “The next couple of months is when retailers place their large orders for the busy Christmas period, so the timing couldn’t be any better for customers who will be looking to pick up some bargains this festive season.
” Harvey noted that turnover at Harvey Norman stores was defying the expected downturn as a result of a potential global trade war. “I’m checking our sales every day, because we should be getting a bit of a downturn because of the election and Trump, and that isn’t happening and that is a bit interesting. And if we aren’t getting affected, probably no one else is.
Around our stores, there are no indications that anything is changing,” said Harvey..
