Temu would enter the EU market with local manufacturers

Price war locally – the Chinese way

Temu’s success lies in the fact that it connects manufacturers directly with consumers, eliminating traditional trade chains. This model has already been proven in the case of industrial goods – and now it would be extended to food. The company’s goal is not to import products from China: instead, it is to build its own local supply chains with European manufacturers, especially in the categories of snacks, drinks, sweets, cosmetics and gardening products.

According to a Temu spokesperson, the platform is already open to European retailers, including Austrian and German, and a significant portion of the food is offered by local partners.

After Germany, Switzerland, and then who knows?

Temu’s first food market partners have appeared in Germany: the meat company Wurstbaron and the muesli bar brand Mr Tom have been present on the Chinese platform for months. The next target is Switzerland, but the company plans to expand its presence to the entire EU. The strategy, built on the principle of “Europe to Europe,” aims to reduce delivery times and environmental impact in addition to price competition – at least on paper.

The trade magazines Retail Detail and Lebensmittel Zeitung also highlight that the expansion into the food market not only means a new source of income for Temu, but also puts even more pressure on local chains, which are forced to compete on a new front.

The numbers speak for themselves

According to Backlinko, in September 2023, Temu had 92 million active users in the European Union. In Austria, the site has 1.8 million visitors per month, and across Europe, 103 million people are already browsing the platform’s offerings. According to Intellinews, in Hungary, Temu was already the largest online shopping platform in 2024: it overtook domestic e-commerce players with 10 million orders and an estimated turnover of 130 billion forints.

Consumer delight, retail headache

The appearance of Temu is undoubtedly favorable for customers: cheaper products, a wide range, fast delivery. For example, Hungarian consumers ordered more from Temu in 2024 than from the ten largest domestic webshops combined. At the same time, consumer advocates warn of shortcomings in the quality, safety and traceability of products – especially in the food category.

Meanwhile, local chains are facing another competitor in an already difficult market: in addition to inflation, regulatory pressure and price-sensitive customer behavior, Temu is now also demanding a share of customers’ money – and it seems to be doing so effectively. The only question is how long this model can be sustained and who will come out on top in the end.