Is it possible to do temu if the profit is too low? How to calculate the profit?

Some seller friends are quite interested in the cross-border e-commerce platform temu, but they heard that the profit of temu cross-border e-commerce platform is too low. They want to know if they can do it with temu even though the profit is too low?

1. Is it possible to do TEMU if the profit is too low?

It depends

Even overseas, Temu’s main strategy is to lower prices, let merchants bid, and attract foreigners to buy with low prices. Therefore, if products are highly homogenized, competition will be very fierce and it will be difficult to survive in such price competition.

How do you know if you are being underpriced? It's simple. Compare your product price with the price of the same product on Temu. If your price can't compete with them, I suggest you give up as soon as possible.

If you are a supplier, you can evaluate whether you can make a profit at this price under the subsidy. If you can make a profit, then you can join Temu bravely; if you are unable to make a profit or even lose money due to Temu's price pressure, then I suggest you not to follow suit and join.

2. How to calculate the profit of temu sellers?

Assume that a seller sells a product on the temu platform for $100, the product cost is $30, the shipping cost is $10, the tax is $5, and the platform commission is 15%. Then, the seller's profit can be calculated according to the following formula: Profit = Sales price, product cost, shipping cost, tax, platform commission

Profit = 100, 30, 10, 5, 15

Profit = $40

However, this is not the final profit, because the seller also needs to consider the impact of the exchange rate. Assuming that the seller's native currency is RMB and the exchange rate is 6.5 yuan/US dollar, then the seller's final profit can be calculated according to the following formula:

Final profit = profit x exchange rate

Final profit = 40 x 6.5

Final profit = 260 yuan

In this way, sellers can know the approximate profit of selling a product on the temu platform. Of course, this is just a simple estimation method, and the actual profit may be affected by market changes, exchange rate fluctuations, return rates and other factors.

After temu cross-border e-commerce sellers understand how to calculate profits, they need to adjust and optimize pricing strategies and budgets based on their actual conditions.

Recommended reading:

Where is the entrance to temu's official website? How to register for temu's cross-border e-commerce?

Does Temu's pricing include shipping costs? What shipping costs do Temu sellers bear?

Has any Temu supplier made money? How to settle Temu payment?