Week #12: TikTok Sues U.S. Government Over Law Forcing Sale or Ban | SHEIN Becomes the Third-Largest Online Fashion Retailer in the U.S.
Latest news and analysis on China’s global e-sellers
Here’s our pick for last week’s news:
Bear Electric Appliance's Overseas Sales Surged by 105.66% in 2023
TikTok Sues U.S. Government Over Law Forcing Sale or Ban
Alibaba's 1688 Partners with ShoppyHub.mn to Expand Mongolian Market Reach
SHEIN Becomes the Third-Largest Online Fashion Retailer in the U.S.
Temu & Shein's Logistics Partner J&T Express Middle East Bags Massive Cash Infusion
Temu Rolls out OBM Channel for Chinese Apparel Merchants
TikTok Trials New E-Commerce Model in Mexico, Aiming for June Rollout
Bear Electric Appliance's Overseas Sales Surged by 105.66% in 2023
In 2023, Bear Electric Appliance recorded a 14.43% YoY surge in its total revenue to reach 650M USD, with its net profit soared to roughly 61.51M USD, up 15.24% from the previous year. A standout highlight of the report is the company's flourishing overseas endeavors in 2023, with 51.14M USD in foreign revenue, surged by 105.66% YoY.
Founded in 2006, Bear Electric initially focused on Original Design Manufacturing (ODM) for overseas clients but has shifted its strategy towards promoting its own brand and leveraging cross-border e-commerce. This pivot has turned out to be fruitful, particularly in Southeast Asia and among the Chinese diaspora in Europe and America, where Bear Electric has begun to establish significant brand recognition.
TikTok Sues U.S. Government Over Law Forcing Sale or Ban
TikTok and its Chinese parent company ByteDance sued the federal government over the new law that forces ByteDance to sell the app or have it banned, with the argument that a sale or ban would violate the First Amendment free-speech rights of its users and hurt small businesses that owe their livelihood to the platform.
The company argues that the U.S. Congress lacks evidence to justify the national security concerns invoked by the app, and that selling its U.S. operations was not "commercially, technologically, or legally feasible". ByteDance has made it clear that the company will exhaust all legal means to strike down this legislation and if all efforts fail, they would rather shut down TikTok's operations in the U.S. than opt for a sale.
Alibaba's 1688 Partners with ShoppyHub.mn to Expand Mongolian Market Reach
Alibaba Group is broadening its market presence in Mongolia through a strategic partnership with the Intelmind-owned retail marketplace ShoppyHub.mn. This collaboration will enable ShoppyHub.mn to offer millions of products sourced directly from Chinese manufacturers via Alibaba's wholesale platform, 1688.com, to both consumers and businesses in Mongolia.
The initiative was put forward to cater to a multilingual audience, supporting Chinese, English, and Mongolian languages. Additionally, it introduces an innovative image search feature, enhancing the shopping experience by accommodating diverse user preferences.
One of the key benefits for Mongolian online shoppers is the ability to consolidate multiple purchases from different regions into a single order. This streamlined process significantly simplifies logistics, with most deliveries to be completed within seven to ten days.
Intelmind, headquartered in Ulaanbaatar as the owner and investor in a portfolio of 18 tech companies, launched Shoppy.mn in 2017. The platform quickly ascended to a leading position within Mongolia's e-commerce sector. The new partnership with 1688.com is poised to further cement ShoppyHub.mn’s role as a dominant force in the local online retail landscape.
SHEIN Becomes the Third-Largest Online Fashion Retailer in the U.S.
Recent data from the ECDB, as cited by the global analytics platform Statista, revealed that SHEIN has ranked as the third largest online fashion retailer in the U.S. and stands as the sole Chinese entity among the top five online fashion players in the U.S., following Amazon and Walmart while outpacing retail giants like Macy's and Nike.
Amazon and Walmart are the biggest online fashion retailers in the United States, according to website ECDB. Both retailers sell all sorts of goods online and in brick-and-mortar stores, with $12.3B and $8.9B worth of apparel net sales in 2023. Following closely, SHEIN ranks third with net sales of $8.1B. Its diverse range of affordable fashion and premium services propelled it past Macy's and Nike, whose net sales reached $6.4B and $4.5B in 2023, respectively.
Moreover, in "2023 Top Ten Fastest Growing Brands in the U.S." released by Morning Consult, SHEIN shares the spotlight with global powerhouses like ChatGPT, OpenAI, Facebook, and Coca-Cola, marking its distinction as the sole Chinese brand and the sole fashion brand featured worldwide.
Temu & Shein's Logistics Partner J&T Express Middle East Bags Massive Cash Infusion
J&T Express, a key logistics partner for e-commerce giants Temu and Shein, has secured a significant funding round in the tens of millions of dollars. The round was led by eWTP Arabia Capital, aiming to enhance J&T’s operations across the Middle East and North Africa (MENA), with a particular focus on expanding its footprint in the United Arab Emirates and Saudi Arabia.
This influx of capital is set to support J&T Express's efforts to tailor its services to the unique demands of the Middle Eastern market, a strategic move expected to drive substantial regional growth. The funding will also aid in broadening the company's global logistics capabilities.
Since marking its initial entry into the Middle East in April 2021, J&T Express has rapidly scaled its operations. By January 2022, it had established significant operational hubs in Saudi Arabia and the UAE. This expansion has enabled J&T to achieve comprehensive coverage across all local provinces and regions in these countries, culminating in a record-breaking daily delivery peak of over 100,000 parcels.
Temu Rolls out OBM Channel for Chinese Apparel Merchants
Temu, the international e-commerce platform operated by Pinduoduo, has unveiled its OBM (Original Brand Manufacturer) channel, a new initiative aimed to support domestic brand merchants whose annual sales meet or exceed 1M RMB (approximately $13.82M USD). The channel initially targets three key categories: men's apparel, men's outdoor wear, and maternity clothing.
This innovative supply model offers a range of benefits tailored specifically for top-tier brand stores. These include expedited approval processes, the ability to compare brands directly without the need for formal pricing verification, and exclusive traffic incentives, enhancing the visibility and sales of these brands on Temu’s platform.
Entry into the OBM channel is governed by specific criteria. Merchants must operate a new store under a new entity with a successful application to join a whitelist. They are also required to list more than 50 product SKUs. Previous store entities and their sub-stores, however, are not eligible for the benefits from the OBM initiative.
OBM provides significant advantages over the traditional fully-managed consignment model, including more flexibility in quality control and pricing review. Additionally, leading brands participating in the OBM program gain access to global advertising support and personalized VIP guidance.
Temu has also streamlined the pricing review process for these premier merchants, allowing for direct brand comparisons without a formal pricing review, thereby establishing a novel pricing mechanism that further simplifies and enhances the marketplace experience for brands and consumers alike.
TikTok Trials New E-Commerce Model in Mexico, Aiming for June Rollout
TikTok Shop is testing a fully closed-loop e-commerce model in Mexico, marking a significant shift as the platform aims to streamline and encapsulate all e-commerce activities within its interface. This pilot, which began in late April, is set to potentially expand into a full-scale launch by June.
The closed-loop model enables TikTok users in Mexico to conduct their entire shopping processes—including payment, logistics, and after-sales service—directly on TikTok, without the involvement of third-party platforms. "Our goal is not to showcase other e-commerce sites but to be a one-stop shop," a TikTok spokesperson stated, reflecting the platform's strategy to provide a seamless shopping experience.
Currently, the trial phase is focusing on merchant recruitment, targeting sellers primarily from Amazon Mexico, Mercado Libre Mexico, and direct-to-consumer (DTC) sites within the country. These sellers are required to have annual revenues exceeding $100,000. However, certain product categories, including baby goods, food, and health supplements, are temporarily excluded from the trial.
With 68.89 million users in Mexico (according to Statista) and a robust network of influencers—approximately 80% of Mexico's influencers favor TikTok over platforms like Instagram and YouTube—Mexico represents a strategic market for TikTok. The platform's strong influence is evident as it stands among the top five social platforms in Latin America, commanding 59% of the influencer landscape.