Chinese e-commerce platforms, including AliExpress, Temu, and Shein, are ramping up their presence in South Korea, shifting from cross-border sales of ultra-low-cost Chinese goods to establishing local marketplaces with domestic sellers. Industry insiders say the move comes as U.S. tariff policies under the second Trump administration threaten their American operations, prompting the platforms to pivot their strategies and tap into new growth opportunities.
Temu, which entered the South Korean market in July 2023, recently began recruiting local sellers for its new open-market platform. This marks the first time the company has actively sought South Korean vendors, expanding beyond its existing direct-to-consumer model for Chinese goods. To support the initiative, Temu has been hiring staff for key roles in human resources, operations, marketing, and logistics since late last year. The company also signed a long-term lease for a large logistics center in Gimpo and is reportedly finalizing contracts with major logistics providers.
Traditionally, Temu operated by purchasing goods directly from suppliers and handling sales and shipping itself. However, with the United States set to end duty exemptions for packages under $800 and impose an additional 10% tariff on Chinese goods, the platform is shifting its strategy. It now encourages sellers to ship products directly to American customers, reducing the company’s exposure to rising tariffs.
Similarly, Shein, another Chinese e-commerce giant, has taken steps to adapt. It has offered higher purchase prices and extended delivery deadlines for suppliers relocating production lines to Vietnam.
Experts say the shift reflects these platforms' efforts to adapt to U.S. tariff uncertainties while viewing South Korea as an alternative growth market.
“With China’s domestic consumption slowing and U.S. demand weakening, South Korea’s high monthly active user (MAU) base makes it an attractive target,” said Oh Lina, an analyst at LS Securities. “If C-commerce platforms aggressively expand here, competition in the local e-commerce market will intensify.”
South Korea’s reliance on Chinese imports has grown significantly. In 2024, 60% of the country’s cross-border e-commerce purchases came from China, up from 49% the previous year, according to government data. The total value of Chinese imports surged 48% year-on-year to 4.78 trillion won ($3.6 billion), reflecting both the affordability of Chinese products and the platforms' aggressive marketing strategies.
The growing popularity of cross-border shopping has fueled the rise of C-commerce platforms. According to market tracker Wiseapp-Retail-Goods, AliExpress and Temu ranked second and third, respectively, in South Korea’s annual e-commerce MAU in 2024, following Coupang. The estimated combined transaction volume for AliExpress and Temu reached 4.29 trillion won ($3.2 billion), an 85% increase from the previous year.
Some see the platforms' shift from cross-border to direct market entry as inevitable. “To compete effectively, e-commerce players must diversify their operational fronts,” said Jung Yeon-sung, a business professor at Dankook University. “For AliExpress and Temu, attracting local sellers not only enhances platform credibility but also builds consumer trust.”
AliExpress, which entered the South Korean market in 2018, launched a dedicated “K-Venue” in October 2023 to promote locally made products. The company also announced plans to invest $1.1 billion by 2026 to establish a logistics center in South Korea, supporting local sellers’ global sales. Shein, meanwhile, has introduced specialized product lines tailored for South Korean consumers.
However, data privacy remains a significant hurdle for C-commerce platforms. In 2024, the Personal Information Protection Commission of South Korea fined AliExpress 1.97 billion won ($1.5 million) after an investigation revealed the company had shared users' personal information with 180,000 overseas vendors without proper consent.
Temu has also faced scrutiny. The company recently informed users that it outsources personal data processing to third-party firms abroad and warned that customers who refuse such transfers may be unable to use its services.
“Given the persistent concerns about product quality and data security, platforms like Temu and AliExpress should consider hosting their databases locally in South Korea,” Jung said. “There also needs to be a clear system for handling consumer complaints and addressing damages to build long-term trust.”
