Big sellers such as Anker have moved into Temu for semi-custody. Are the good days for fully-custodial sellers coming to an end?

Since its launch in September 2022, Temu has been on a roll. Currently, Temu has opened more than 70 sites including the United States, the United Kingdom and Australia, with business covering the Americas, Europe and Asia.

Some time ago, Temu launched a semi-hosting model for sellers on the basis of full hosting, which attracted many sellers to join, including super sellers such as Anker Innovations, Dreame Technology and Qian'an Technology.

Anker and other big sellers enter Temu semi-custody

On March 15, 2024, Temu's semi-hosted business was officially launched in the United States, and soon thereafter, nine major sites including the United Kingdom, Canada, Italy, Germany, Spain, France, Australia, and New Zealand were opened.

For a time, the relevant news became the "top stream" in the cross-border circle, and even the company's own full-custody business was forced to give way. There were rumors that many excellent buyers had switched from full-custody to semi-custody.

Compared with full hosting, the advantages of semi-hosting are mainly reflected in the two aspects of stocking and logistics. Sellers can directly skip the process of product selection and sample delivery, and only need to upload products and maintain inventory. In addition, sellers can also be responsible for warehouse and delivery services by themselves, which optimizes the logistics timeliness.

Recently, there have been reports that a number of big sellers including Anker have already entered Temu's semi-hosted service, and traditional giants such as Midea, Xiaomi, Liby, and Vinda have also announced that they have established cooperation with Temu.

After searching, I found that I could indeed find all kinds of Anker products. However, it seems that because it has been in the market for a short time, the sales of Anker products are not as high as expected.

Data shows that the best-selling charging plug in Anker's official store only had sales of more than 100 units, and the total sales of the entire store were only more than 1,500 units.

Interestingly, there is also a refurbished product store on temu that has been officially verified by Anker . The total sales of this store have reached more than 3,700 units, and the best-selling mobile power bank has sold more than 1,000 units.

Afterwards, Yien.com searched for products of Dreame Technology and Qian'an Technology's brands on Temu and found that most of them are still in the early stages of development, with average sales and review data, and no so-called explosive products have emerged.

However, although big sellers have not yet made a big splash on Temu, it has to be said that Temu's semi-hosting model has indeed brought traffic and sales to many small and medium-sized sellers.

In Temu’s Best Seller section, you can see that many products are from semi-managed merchants (with a special Local warehouse logo).

It has been reported before that the first wave of sellers who benefited from Temu's semi-custodial dividends have achieved double growth in orders and profits. Many sellers have achieved an average daily order volume of over 10,000 and an average daily sales of over US$100,000.

Of course, these cases do not represent the true situation of most sellers. Since the launch of Temu’s semi-custodial model, some people have found that the trend of differentiation between the seller groups on the platform seems to be increasing.

Temu merchants are increasingly divided

Relevant industry insiders estimate that Temu's semi-hosted business will reach US$10 billion in 2024, and the total site will reach US$60 billion, which is several times higher than its GMV last year.

However, the rapid promotion of the semi-custodial model may bring short-term dividends, but this may be followed by the decline of the dividends of the full-custodial model.

Some time ago, a fully managed seller said: "For small sellers like us, the days of making money easily on Temu may be gone forever."

It is understood that when Temu's full-hosting model was first launched, sellers only needed to find pictures on the source website, and then use the software to put them on the shelves with one click to test out hot-selling products, but now this approach is obviously no longer usable.

This seller believes that the launch of semi-hosting is a turning point. Now the platform is focusing all its efforts on semi-hosting, and the benefits of full-hosting are beginning to decline, which is a big blow to small and medium-sized sellers who rely on full-hosting.

There are also Temu full-hosting merchants who frankly said that as more and more semi-hosting merchants enter the platform, the pressure on full-hosting merchants is indeed not small. Now through keyword search, many of the links at the top are from semi-hosting stores.

However, for some sellers who have a certain scale, the semi-hosting model is an opportunity. With many years of experience in Amazon FBA, these sellers can give full play to their advantages in logistics and warehousing.

As Temu's semi-custodial model continues to develop, changes in the types of products will also follow.

On the Temu homepage, you can see that more and more large items such as furniture and home appliances are gradually replacing the low-priced items of $0.99 that used to appear on the homepage. In addition, Temu has also increased its investment in industrial tool products, which have a higher average order value, stable demand, and a high repurchase rate.

By increasing its efforts to introduce such products, Temu hopes to gradually get rid of the label of a low-price platform and slowly transform into a mid- to high-end platform.

On the other hand, most of Temu’s newly recruited semi-managed sellers have many years of cross-border experience. After all, Temu’s delivery time requirements will passively screen out a group of them. The rest are sellers with many years of overseas operation experience, mature supply chain and overseas fulfillment capabilities.

Although it is currently a period of rapid development and bonus for semi-trusteeship, there are still many concerns for sellers.

It has been reported before that the issue of platform fines has always been a concern for sellers. According to the after-sales rules displayed on the Temu semi-hosted backend, for products with quality problems, Temu officials have the right to impose a fine of three times the total value of the goods on the merchant.

In addition, out-of-stock goods, false shipments, fraudulent shipments, illegal logistics and freight terms, and product quality problems will all result in corresponding fines.

Chat records of sellers showed that one seller was fined 66,000 yuan in 14 days, a total of 200,000 yuan, while another seller was deducted 37,000 yuan within a month.

A few days ago, a seller revealed that a large number of platform merchants gathered together again to start the road of rights protection, and the reason was still because of the fine issue. From the exposed video, it can be seen that the downstairs of Aoyuan Building in Panyu District, Guangzhou was crowded with sellers who were defending their rights.

According to people familiar with the matter, some merchants in this business were fined hundreds of millions or even hundreds of thousands, including some sellers who have been in business for many years and have a good reputation.

It seems that both fully managed and semi-managed sellers are facing their own problems. The platform is still in a period of rapid development, and relevant rules are being continuously optimized. How the sellers will fare in the future remains to be seen.

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