Already flooded with cheap imported goods, Amazon is said to be copying the business model made popular by sites like Shein and Temu, made possible thanks to trade loopholes. is.
Amazon appears to be getting into the bargain basement business.
The online retail giant, already known for offering a wide range of imported goods at low prices, has launched a new storefront filled with ultra-low-priced items, aimed at competing with rivals such as Tem and Shein. It is reported that it is scheduled to be released. According to a scoop from informationthe new site will cap prices on hundreds of products.
Click here for Gizmodo detail:
Top prices include $8 for jewelry, $9 for bedding, $13 for guitars, and $20 for sofas. Amazon doesn’t have a price cap system on its major marketplaces, so this is a completely new approach to experiment with in new stores. Items will be shipped from our fulfillment center in Guangdong, China.
The shipping schedule will reportedly be approximately 9 to 11 days, and sellers will be charged $1.77 to $2.05 to ship 4-ounce to 8-ounce items from the center. This information compares these numbers to the $2.67 to $4.16 fees that sellers pay to ship the same weight of items from local warehouses under Fulfillment by Amazon.
Amazon’s planned new store is said to be called “The Low-Cost Store” and is likely Signs retailers are feeling the pinch From Chinese companies like Temu that sell incredibly cheaply. Probably toxic Ship the product directly to the consumer. Tem and Shane managed to make it. gain large market share Over the past few years, the online retail industry has adopted this business model.
But not enough is being done to stop both companies from abusing U.S. trade laws to control the online retail industry.
A trade law loophole known as “de minimis” allows imported packages under $800 to enter the United States duty-free, allowing Tem and Shayne to avoid customs duties and trade inspections when shipping ultra-cheap goods directly to customers. can be avoided. . 2023 report According to an investigation by the Chinese Communist Party (CCP) Special Committee, the two companies send 600,000 packages to the United States duty-free every day (and this number is likely only increasing).
U.S. manufacturers have been particularly hard hit by this small loophole. According to the National Council of Textile Organizations (NCTO), there are 19 textile mills. Closed within the past year. For those of us who care about how things are made, and for the people who make them, the fact that Amazon is moving to the business model that Teem and Shein perfected is a sign of where things are going. That’s a bad sign of what’s on the way.
As a fast company put it down“No sofa costs $20.”
There are obvious sustainability issues with such cheap products. $20 for a sofa means that furniture that once lasted generations, become disposable. And making and selling something so cheaply, whether it’s furniture or a simple T-shirt, means There is a high possibility that forced labor is involved.:
“If you see a price like[a $20 sofa]that’s a red flag that there may be some part of the product’s supply chain that needs further investigation,” says Associate Professor of Supply Chain and Information. Sean Bhimani says. Northeastern University Management Team. “Could it be that the material is coming from a place that is basically rock bottom and cannot be sold anywhere else because of the risk of forced labor?”
Currently, most Chinese cotton is produced in areas where Uyghurs are forced to work, Bimani said. It’s illegal to import into the United States, but some companies are trying to find ways around it. “What we’re tracking is that some of the materials that end up in products like sofas can end up in the supply chain through these back channels and other channels, making them difficult to trace. It’s about gender,” he explains.
Closing minimal loopholes is probably the most effective measure to address these unfair practices, and Fast Company believes that “if customs laws and tariffs change, Amazon will not be able to proceed with its rumored store.” “There is a possibility that they will make a decision that is not correct.”
The Biden administration recently announced: it will take action Reducing minimum imports is a good step in addressing loopholes. Details of the White House’s actions are still being worked out, but both Tem and Shein said likely to have good weather No matter what happens.
That means strong action from Congress will likely be needed to effectively close the loophole permanently. Import Security and Fairness Act and Fight illegal goods, support trusted importers, and benefit from U.S. law (FIGHTING).
And until policymakers intervene, the race to the bottom in retail is almost certain to continue.
