Do you shop at Tema? Hundreds of vendors protest outside the group’s doors over unfair fines

Hundreds of sellers on Chinese e-commerce platform Temu protested Thursday outside the company’s headquarters in Guangzhou, southeast China, against what they see as unfair penalties for after-sales service issues.

Videos posted on Chinese social media and local media showed some protesters even entering Temu’s office and leaving only after police intervened.

Private newspaper Caixin reported that the first protest took place on July 22, and a new demonstration was held on Monday with a larger turnout, with an estimated 700 to 800 protesters.

Temu, the international platform of local e-commerce company Pinduoduo, has quickly expanded its presence to 75 countries after launching in September 2022 and competes with Chinese rivals such as Shein, TikTok Shop and AliExpress, Alibaba’s international unit, offering products at rock-bottom prices.

However, Chinese sellers have accused the company of imposing very strict conditions, including the aforementioned fines if customers complain or demand refunds.

Caixin quoted one protester, a clothing retailer, as saying that fines and funds set aside by Temu for post-sale litigation amount to about 35% of total sales: “Temu’s gross profit with their prices is 10% to 20%, so after the fines, we’re bleeding.”

Another trader, quoted by Hong Kong’s South China Morning Post, said Temu fined him three million yuan (€383,111) last year, depriving him of almost all his profits.

A mobile phone seller in the southeastern city of Shenzhen said it lost about $80,000 (€73,900) to Tem because of the fines, as well as the company’s policy of allowing customers to keep products in the event of a dispute rather than returning them, saying the company imposes fines of up to five times the amount charged.

“Traders have refused to resolve disputes through legal and mediation channels provided for in the contracts. The situation is stable, the company is actively working with traders to find a solution,” the company said in a statement quoted by the newspaper. From Hong Kong.

However, there are traders who have taken the matter to lawyers in protest through the market regulator, according to Caixin.

The issue is under close scrutiny by EU and US authorities, who are considering imposing tariffs on these Chinese platforms selling goods at low prices.

According to local press, the e-commerce platform’s sales in the first half of the year amounted to $20 billion (€18 million), exceeding last year’s $18 billion.