After Launching Temu, Pinduoduo Unveils 10B-Yuan Support Plan for Chinese Enterprises Going Abroad
Following the low-key launch of its cross-border e-commerce platform Temu, Pinduoduo, a Nasdaq-listed Chinese e-commerce company, has further unveiled its overseas exploration plan. On September 19, the firm announced the official launch of the “2022 Pinduoduo Overseas Expansion Support Plan for Chinese Enterprises“, in which it will invest 10 billion yuan to help 100 Chinese brands establish their name in overseas markets. It will also support 10,000 Chinese manufacturers exploring overseas markets, and provide integrated service solutions.
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The main support of the new plan includes several measures. It will provide long-term, zero- commission fees and zero-merchant guarantees for Chinese manufacturers that are launching overseas businesses. Pinduoduo will also invest 10 billion yuan and unite with 100 industrial bases to build up 100 already-established Chinese brands overseas in the first phase. The company will also provide all-round infrastructure services, including warehousing at home and abroad, cross-border logistics and after-sales services, while opening up a “full link” cross-border path for manufacturers.
In addition, Pinduoduo will also launch integrated solutions, involving language and culture, product standards, intellectual property services, legal aid and trade arbitration to safeguard the rights and interests of Chinese manufacturers. It also plans to provide special training and launch customized courses for different types of products to help enterprises quickly explore overseas markets.
“During overseas market exploration, many Chinese manufacturers are facing the pain point that they cannot directly find out the needs of overseas users and obtain the corresponding value.” According to a person in charge of Pinduoduo’s new support plan, the cross-border e-commerce business is mainly being provided through new technologies, eliminating the gap between trade and logistics, and connecting overseas demand and Chinese supply. It aims to reach overseas consumers in a more direct way.
Pinduoduo has not yet responded to how it will select and support the 10,000 enterprises and their specific standards. However, a person close to Pinduoduo told China Business Journal that the batch will be manufacturers, aiming to further demonstrate the strengths of the Chinese manufacturing sector to overseas markets. This move is similar to Pinduoduo‘s operation of the “New Brand Plan” conducted in the Chinese market. It is likely to focus on sifting through quality firms in China’s manufacturing industry, especially OEMs (original equipment manufacturers) that provide high quality and low price.
Whether it will continue the low pricing strategy is another focus of attention for Pinduoduo to enter overseas markets. A clothing merchant said that products with lower prices can more easily pass the platform audit and go online in Temu. This is also consistent with Temu’s products currently displayed. The website shows that the price of women’s clothing for summer is mostly under $20, while necklaces, rings and other accessories are mostly between $5 and $10. It is best at providing ultra-low priced products in Chinese market, and it remains to be seen whether this path will be feasible in overseas markets.