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Swiss businesses losing billions due to Temu and Shein

Published on November 9, 2024

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Swiss businesses losing billions due to Temu and Shein — Egger said low-cost competition poses a real threat to Swiss stores, but especially to those that are themselves in the low-price segment. Keystone-SDA

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Swiss businesses are losing billions of francs a year as a result of the spread of Chinese online platforms Temu and Shein, says the director of the federation of Swiss retailers.

This content was published on November 9, 2024 - 10:40

Bernhard Egger, director of Handelsverband.swiss, was speaking at the Retail Forum in Zurich on Friday. He estimated that the turnover being siphoned off by Chinese competitors to be roughly CHF1 billion ($1.14 billion). “If you then consider that the equivalent value is often higher, it comes to CHF3 billion that Swiss retailers are losing,” Egger said.

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In his view, low-cost competition, especially from China, poses a real threat to Swiss stores, but especially to those that are themselves in the low-price segment. “For companies active in higher price segments, with better quality, such suppliers are less of a competition,” he said.

Egger predicted growth for Swiss online commerce in the coming year and points to the roughly 10% expansion observed in the past four years. In his view, however, retailers will have to adapt to changes in their sales channels: social commerce, or selling through social media, is becoming increasingly important.

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“Tiktok is becoming the new Amazon,” he said. Tiktok, which is also Chinese-owned, now offers the entire sales process to online traders, from ordering to payment to logistics.

According to Egger, social commerce currently accounts for about 10-15% of Swiss online commerce: “We believe that this percentage will increase to about 25%, so this topic will continue to be of interest to us.”

An ever-present issue is also that of so-called hybrid shopping, that is, the mix of online and in-store shopping. According to Egger, the idea that this trend leads people to look at products in stores and then buy them on the internet at the best price is incorrect. “We also often see customers inquiring about a product online and then coming to the store to see it in person and buy it,” he concluded.

Translated from Italian with DeepL/gw

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