Chinese suppliers storm Temu office in Guangzhou in protest over 'harsh' policies

South China Morning Post:  Hundreds of Chinese suppliers on Temu, the overseas shopping app run by PDD Holdings, staged a protest at the e-commerce giant's office in Guangzhou, alleging unreasonable platform policies, according to merchants and local Chinese media reports.

Dozens of protesters stormed the PDD office on Monday afternoon, according to video clips posted on social media and confirmed as authentic by merchants. The Chinese media outlet, Yi Magazine, reported on Tuesday that about 80 merchants entered the PDD office on Monday, but left after police intervened.

It is not the first time merchants have protested against Temu. In a statement issued on Tuesday, the company said that "a group of merchants gathered at the office of a Temu logistics affiliate in Guangzhou" recently.

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"They were unhappy with how Temu handled after-sales issues related to the quality and compliance of their products, disputing an amount worth several million yuan," the statement said, without referencing the July 29 protest.

"These merchants have declined to resolve the disputes through the normal arbitration and legal channels stated in the seller agreements. The situation is stable, and the company is actively working with the merchants to find a solution," Temu said

PDD's stock price lost 2.5 per cent in New York overnight.

The actions by Chinese suppliers could add to the uncertainty around Temu, which is facing other risk factors such as strict import duties imposed by the US and European Union. Temu competes against Shein and TikTok Shop, as well as Alibaba Group Holding's AliExpress, in selling made-in-China products directly to overseas buyers. Alibaba owns the South China Morning Post.

Temu is expanding its sales outreach to consumers in the US and other overseas markets, offering products such as US$6.92 dresses and US$3.99 sandals. But many Chinese suppliers complain that the platform has set harsh terms, including hefty "fines" if customers complain or request refunds. Temu allows consumers to keep refunded items due to the high cost of cross-border logistics, but some merchants said they have not received any reimbursement in these cases.