temu does not manufacture goods, it is just a porter "made in China".
On the evening of November 29, Pinduoduo surpassed Alibaba for the first time in intraday trading to become the largest Chinese concept stock in the United States.
Although there is no suspense in the industry that "the market value of Pinduoduo will surpass Alibaba", when this result suddenly appeared, it still caused an uproar in the Chinese and foreign financial circles.
From the analysis of revenue structure, the item that has a significant impact on Pinduoduo's revenue is "transaction service revenue", which is 29152.7 billion yuan (39.7 billion$95.7 billion), up from $70.0 in the same period in 202222.3 billion yuan, an increase of 315%.
The surge in transaction services revenue means that Pinduoduo's overall GMV has increased significantly.
This increase is generally believed by the industry to come from Pinduoduo's cross-border e-commerce temu.
Temu was launched in North America in September 2022, and within one year, Temu has expanded to 40 countries and regions, gradually covering North America, Oceania, Western Europe, Latin America, Eastern Europe, Japan, South Korea, Southeast Asia, and the Middle East.
According to the data, within 3 months of entering the U.S. market, Temu won the first place in the U.S. App Store app list, and became the No. 1 app in the U.S. Android app list for two consecutive weeks. According to a report by Sensor Tower, a market research institution, the number of Temu apps in the second quarter of this year entered the top 10 in the world for the first time, more than doubling from the first quarter, from 31 million to 74 million.
According to 36 Krypton, Temu's GMV exceeded $5 billion in the third quarter of this year, far exceeding the performance of $3 billion in the first half of the year.
According to Pinduoduo information, its internal annual KPI plan for Temu is US$15 billion, but CICC**, Temu's annual GMV can reach US$18 billion this year.
Temu is not the first cross-border e-commerce platform to go overseas, and it is not a unique e-commerce business in the North American market. So, why is temu able to soar so wildly and sweep the world?
This is related to Temu's important business model innovation, that is, the "full custody" model.
In the past, in cross-border e-commerce, the order of entrants was to first go to overseas e-commerce platforms such as "Amazon" and apply for registered store qualificationsThen hire employees who are familiar with overseas store operations (or operate on behalf of others) to carry out e-commerce operations such as store decoration, product listing, and investment and purchase;After receiving the order, it is necessary to ship the goods to overseas customers through various logistics measuresAt the same time, customer service personnel are required to connect and serve the entire process.
Finally, cross-border e-commerce merchants should also pray every day not to be excused by the Amazon platform to deduct income, or even unreasonably close stores.
This process not only has high requirements for the whole process operation ability of the merchant, but even has a certain fantasy color, and the luck component accounts for a large proportion.
Pinduoduo's TEMU has innovatively established a "full custody" model to provide one-stop shopping for overseas consumers with goods from Chinese manufacturers.
The whole process of temu sales is usually as follows: uploading products - selecting and reviewing - sending samples - reviewing samples and verifying prices - applying for stocking - shipping - quality inspection and warehousing - selling on the shelves - platform distribution - consumer signing - after-sales service.
Temu's full custody model is that the temu e-commerce platform fully contracts complex links such as store operation, logistics fulfillment, and after-sales service, and the merchant only needs to be responsible for the product.
As a result, "Made in China" merchants will hand over the operational burden to the Temu platform and only focus on supply, and both sides will give full play to their comparative advantages.
At present, the global economy is at a low ebb, and the dual circulation of China's economy needs to further expand the scale of overseas exports. How to help more "Made in China" go out is a major and meaningful topic for e-commerce practitioners.
"Made in China" has always had the characteristics of high quality and low price, but in the traditional channel model, according to the profit sharing chain of commercial circulation, a large part of the profits are earned by middlemen, that is, exporters.
Temu's fully managed model allows Chinese manufacturers to "reduce the middleman to make the difference" and achieve "retail revenue at factory cost".
In the process of full custody, temu is also able to grasp the pricing power by selecting the most cost-effective products among a large number of top merchants, and reduce logistics costs by cooperating with shipping companies to achieve "volume for price".
Taking an export hat factory in Yiwu as an example, under the traditional foreign trade OEM model, a hat priced at 15 yuan can only earn 5 cents per hat.
Nowadays, on the Temu platform, the net profit of a hat can reach 30%.
The reason for this increase in revenue is that for foundries, they only need to continue to do a good job in the "cost-effective" design and manufacturing, which completely eliminates the fulfillment links of cross-border delivery operations, warehousing and logistics, and the transaction is much higher than that of OEM orders.
More sales may not necessarily lead to small profits. ”
As a result, TEMU can greatly accelerate the efficiency of Chinese goods going overseas.
At the end of the writing, there is a thought, that is, in the domestic market, why is there no e-commerce platform that adopts the "full custody" model?
We will talk about it in the next issue, welcome to pay attention.