New EU tariffs and customs fees introduced on July 1 were designed to reduce the competitive edge of Chinese platforms such as Shein, Temu, and AliExpress, while also curbing the influx of inexpensive shipments from China. A month after these changes, although shopping costs have noticeably risen, Chinese platforms have not only managed to retain their market share but have also quickly adapted their strategies to the new regulations. Instead of a massive customer exodus, buying behavior has evolved.
Over half of Eurozone residents have utilized Chinese e-commerce platforms, with 20% making purchases at least monthly. Many Europeans consider Temu, Shein, and AliExpress essential shopping channels, primarily due to low prices and a broad product selection, as reported in a July study by the European Central Bank.
As part of the new regulations, a €3 tariff was imposed on packages valued up to €150 coming from outside the EU, mainly from China, marking the end of previous customs exemptions for such shipments.
Price Shock and the End of Bargain Shopping
The immediate consequence of the new rules has been a rise in retail prices. Sebastian Błaszkiewicz, an expert at Univio, a digital commerce firm, noted that platforms swiftly passed these costs onto consumers.
Each platform adopted different strategies: Temu seeks to maintain attractive product prices during the search phase, revealing additional costs only at checkout; AliExpress often raises initial product prices, while Shein employs a mixed approach.
Data indicates that the new regulations have hit the low-value product segment the hardest. A product priced at €1 may now cost around €4 due to the new fixed fee, making “bargain shopping” less appealing, Błaszkiewicz points out. Many purchases on these platforms previously revolved around such low-cost items.
The €3 fee significantly increases the proportional cost of buying in these categories, directly impacting accessories, cheap gadgets, and fast fashion items, as highlighted by Damian Siusta, a manager at Postis, which focuses on last-mile delivery management.
Initial Consumer Response: Abandoning Carts
Bartosz Sawicki, CEO of Meest Transfer, a fintech firm handling payments and money transfers, reported that initial days following the new regulations saw a trend analysts had predicted: a sharp decline in conversion rates, indicating fewer users who ultimately complete purchases after visiting a site or app.
Shein and Temu have reduced their advertising expenditures in Europe while monitoring consumer reactions. AliExpress has begun to present customs and VAT more prominently in pricing or before checkout. Market information confirms the presence of price shock and a change in platform strategies.
Experts caution that we are only observing the early weeks of the new regulations. Long-term data will be needed to assess the durability of these changes.
Already, however, the market has noted a clear drop in the number of low-cost shipments. According to Błaszkiewicz, the industry estimates reductions in ultra-cheap package volumes by several to dozens of percent. Siusta also noted that prior to the regulations, analysts had projected a decrease in low-value imports to the EU by around one billion shipments annually.
Consumers Haven’t Left; They’ve Changed the Rules
The new regulations have impacted the business model of Chinese players, yet the primary reasons consumers started shopping there remain unchanged.
The ECB study reveals that price remains the main draw, but consumers also appreciate the availability of both everyday items and niche accessories often not found in local stores.
Notably, those who frequent these services are often from lower- and middle-income households. For these customers, even minor price differences are significant, which further strengthens demand resilience against regulatory changes.
This is why experts do not anticipate a sudden decline in the popularity of Temu or Shein. They believe new fees modify the economics of shopping but do not eliminate these platforms’ main competitive advantages.
Interestingly, consumer behavior has shifted in response to the new rules. Błaszkiewicz notes that individual item orders have been replaced by bulk purchases to distribute customs fees across more products. Others are consolidating orders to spread the fixed fee over a larger quantity from a single category, altering basket structure.
At the same time, some demand has indeed started drifting toward local retailers. Błaszkiewicz highlights that certain consumers are seeking cheaper alternatives on local platforms, especially those who previously had concerns about quality, safety, or environmental impact of products from China.
Giants Expand European Centers
Perhaps the most significant change is occurring on the platforms themselves. Experts agree that Temu, Shein, and AliExpress had been preparing for the new regulations well ahead of time.
According to Siusta, these platforms have found and partly implemented effective strategies even before the regulations took effect. A key method has been the expansion of their own distribution centers within EU nations.
The new model relies on bulk importing goods to Europe and then fulfilling orders from local warehouses. Products are imported collectively to the EU, while individual packages shipped from within the EU are exempt from the €3 fee. Additionally, this model has shortened delivery times from several days to just two or three days, enhancing the appeal of numerous offers and mitigating the negative effects of the new customs fees.
Similarly, Sawicki anticipates that warehouse expansion within the EU is the most likely response. He notes that Shein is increasing its warehouse space in Wrocław and importing popular products to Europe in larger batches.
Has Europe Really Levelled the Playing Field?
Błaszkiewicz contends that the new regulations represent a significant step toward fairer competition, yet he also emphasizes that merely imposing fees does not resolve all issues.
Siusta is more skeptical, asserting that the leveling of competition has proven illusory, as platforms quickly adjusted their logistics to the new realities.
He points out that through the development of a European logistics network and the bulk importation of goods, platforms like Temu and Shein continue to offer prices unavailable to local retailers.
Sawicki echoes this sentiment, noting that tariffs do not lead to complete competitive equality. Chinese platforms maintain advantages in scale, direct relationships with manufacturers, vast assortments, sophisticated sales algorithms, and the ability to fund discounts and promotions.
The challenge is substantial. In 2024, approximately 4.6 billion e-commerce packages valued at up to €150 will arrive in the EU, with 91% sourced from China. By 2025, the number of imported low-value items is expected to rise to nearly 5.9 billion.
