2024-03-25 15:33:35 ET
Summary
- Temu’s impact on Amazon.com, Inc. may be underestimated in the next several years as it will likely grow rapidly as it offers consumers lower prices. It may cut into Amazon’s growth.
- In the long run, Amazon will likely persevere given advantages in its fulfillment capabilities and broad service offerings as well as legal and regulatory options.
- Worst case scenario, Amazon can copycat Temu's model for lower transaction value products, as I believe Temu does not have any substantial moat preventing copycatting.
- Therefore, any short-term dips in Amazon’s stock price, especially if Temu’s expansion dents Amazon’s financials noticeably, will be a great time to buy Amazon.
The Wall Street Journal ((WSJ)) recently reported "Amazon's new focus: Fending off rivals Temu and Shein." How does Temu impact Amazon.com, Inc. ( AMZN ) and how can Amazon respond? How will Amazon fare in its competition against Temu?
This article will attempt to address these considerations from an investor's point of view. This article covers Temu rather than Shein, as Temu is more of an "everything store" akin to Amazon, while Shein is more focused on apparel....
Read the full article on Seeking Alpha
For further details see:
Amazon Faces Off Against Temu: Who Will Win?