Official announcement from Amazon or major tech news outlets

Amazon Prepares Low-Cost Storefront with Price Caps to Rival Temu

Oct 22, 2024, 01:32 PM

Amazon is preparing to launch a new low-cost online storefront to compete with Temu, a Chinese e-commerce platform operated by Pinduoduo. According to reports from 'The Information', the new Amazon store will feature strict price caps to attract budget-conscious consumers. Items on the platform will have maximum prices, such as $8 for jewelry, $9 for bedding, $13 for guitars, and $20 for sofas. This move is seen as a direct challenge to Temu, which demands that products be priced 15% to 35% lower than on Amazon. The new storefront aims to ship orders directly to U.S. customers from Guangdong, China. Amazon's strategy includes maintaining its existing fees for sellers, which contrasts with Temu's lower fees that allow for more competitive pricing. Amazon reportedly earned around $140 billion in 2023 from services. The launch of this new storefront was initially reported back in June.