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Temu and Shein Announce U.S. Price Hikes Following Tariff and Trade Policy Shifts

The fast-fashion giants will raise prices starting April 25, citing increased costs from a 145% tariff on Chinese imports and the end of the de minimis duty exemption.

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Overview

  • Temu and Shein have informed customers that price increases will take effect on April 25, 2025, as operating costs rise due to new U.S. trade rules and tariffs.
  • President Trump’s 145% tariff on Chinese imports and the elimination of the de minimis exemption starting May 2 are key drivers of the policy changes impacting these retailers.
  • Both companies have significantly reduced U.S. ad spending, with Temu cutting its digital ad budget by 31% and Shein by 19%, potentially affecting platforms like Meta and Alphabet.
  • U.S. shoppers have stockpiled purchases from Temu and Shein, leading to a surge in sales in March and early April, with Temu’s revenue up 46% and 60% during those periods.
  • Analysts suggest the policy shifts could disrupt the low-cost business models of these platforms, forcing them to explore alternative sourcing and pricing strategies.