🌀 E-commerce Surge Drives Up Warehouse Pollution💨

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The first nationwide study using satellite data by researchers from George Washington University's Milken Institute School of Public Health reveals the impact of warehouse traffic on air quality. E-commerce seems to drive up warehouse pollution

📊 Surge in Warehouses

• There was a 117% increase in the number of new warehouses built between 2010 and 2021.

• Newly constructed warehouses are larger with more loading docks.

• Gaige Kerr, lead study author, says, “I would argue that it’s a very meaningful, impactful amount [of NO2 pollution].”

• Just 10 counties in California, Texas, Illinois, Florida, Arizona, and Ohio are home to 20% of all warehouses.

🌍 Environmental Impact

• Warehouse traffic linked to a 20% increase in nitrogen dioxide (NO2) pollution in downwind neighborhoods.

• NO2 is a key smog ingredient and can worsen respiratory diseases.

• Pollution spike equivalent to reversing years of Clean Air Act efforts.

• Satellite data from the European Space Agency used for analysis.

👥 Impact on Communities

• Communities of color are disproportionately affected by warehouse pollution.

• Areas with most warehouses have 290% more Asian residents and 240% more Hispanic residents than the median nationwide.

• Residents have fought against warehouse construction near homes.

• Local regulators urged to treat warehouse emissions like industrial pollution.

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Recently Statista has published an interesting infographic based on ECDB figures, regarding Amazon and Pinduoduo. It seems that Chinese competition is making significant strides in the e-commerce sector.

📊 Pinduoduo's Rapid Growth

• In 2019, Amazon's GMV was over twice that of Pinduoduo.

• By 2024, Pinduoduo will be just 13% behind Amazon.

• Shortly after the release of the shopping app Temu in the autumn 2022, Pinduoduo renamed itself PDD Holding

• PDD Holdings (Pinduoduo) saw record sales of $34.9B in 2023, 90% growth from the previous year.

🚀 Temu's Impact

• Temu app launched in the USA in autumn 2022, topping download charts.

• Temu's global GMV is $30B vs. Amazon's $389B.

• Available in Germany since April 2023 with rising success.

• 1 in 4 Germans bought from Temu in the past six months.

📦 Amazon's New Strategy

• Amazon plans a discount segment to compete with Temu.

• Direct shipping from manufacturers to cut costs.

• Potential longer shipping times from China.

• Will this hurt Amazon’s reputation for fast shipping?

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According to Brittain Ladd, Bernstein published a report on Temu that dives into some of the economics of the platform. The information highlights Temu’s performance, semi-consignment model, profitability, and comparisons with Amazon.

📊 Q2 Temu Performance

• Gross Merchandise Value (GMV) reached $11-12B.

• Margins on GMV slightly improved quarter on quarter.

• Estimated full-year GMV for 2024 is $54B.

• "The idea that Temu is nothing more than an online dollar store is false," said Brittain Ladd.

🚚 Semi-Consignment Model

• Exceeds 25% of US GMV by June, contributing to over a third of global GMV in Q2.

• Enables entry into heavier, higher AOV categories like appliances and furniture.

• Allows 3-5 day fulfillment, reducing long-haul shipping costs.

• Temu can remain cheaper than Amazon even with 20-25% tariffs

💰 Profitability

• Temu is now profitable in the US, with non-GAAP operating profits of $90M in Q1 and $150M in Q2.

• Rest of the world still loss-making but expected to follow the US trend within 6-12 months.

• Forecasts $54B of full-year GMV this year, with marginal annual profit.

📉 Comparisons with Amazon

• Report suggests direct comparison with Amazon may misrepresent the market opportunity.

• Total retail market in the US is over $7T, with Europe and the UK adding another $3T.

• 90% of this market is not Amazon GMV and involves various offline retailers.

• "90% of the market involves various offline retailers sourcing from similar Chinese suppliers," Ladd added.

▶🇺🇸 Amazon's New Discount Section Takes on Temu. Amazon is set to compete with Temu and Shein by launching a discount section featuring ultra-low-cost goods shipped directly from China. The new section will offer items under $20, delivered in 9-11 days, starting this autumn.

▶🇮🇹 Amazon faces €121M seizure for tax fraud, worker abuse. Amazon is accused of tax fraud and worker exploitation, using illegal subcontracting schemes. Prosecutors uncovered fake contracts and false documents. Amazon denies wrongdoing.

▶🇺🇸 Amazon defeats class action over delivery fees. A judge dismissed a class action accusing Amazon of misleading Prime members about Whole Foods delivery fees. The lawsuit claimed a hidden $9.95 fee was deceptive. Amazon argued fee changes were disclosed. The case may be amended.

▶🇨🇳 Alibaba launches global free shipping for fashion. Alibaba offers a global free shipping plan for clothing merchants on Taobao and Tmall. This move aims to boost overseas sales and compete with Shein and Temu. Qualified merchants can ship to Asia markets, with Alibaba handling logistics.

▶🇰🇷 AliExpress fined $1.4M for privacy breaches. AliExpress shared info with 180K foreign sellers without proper measures. The decision emphasizes foreign e-commerce operators must comply with national laws. AliExpress is taking corrective steps.

▶🇪🇸 TikTok to Launch In-App Shopping in Spain, Ireland by October 2024. This move follows hiring 40 workers in Spain, showing the company’s focus on European eCommerce. Expansion to more countries in 2025 is planned.

▶🇨🇳 TikTok Lite faces criticism over safety gaps. Experts criticize TikTok Lite for lacking safety features present in the main app. A report by Mozilla and AI Forensics highlights missing content labels and controls, labeling the app a "safety hazard." TikTok refutes the claims.

▶🇺🇸 eBay Surveys Sellers, Video Sharing Needed. eBay invited sellers to a survey requiring video uploads. Participants get a $250 Visa e-gift card. The survey runs from July 15 to 26, using dScout. Some sellers worried it was a scam, but eBay confirmed its legitimacy.

▶🇨🇳 Shein invests $270.5M in Europe for growth. Shein is investing $270.5M in Europe over 5 years. $54.1M is for R&D. The $216.4M fund targets sustainability and recycling tech. This shift could reduce reliance on China and improve Shein's image before a potential London IPO.

▶🇿🇦 Shein launches South Africa pop-up store. Shein is opening a pop-up store in Johannesburg, South Africa. The store will be at the Mall of Africa and run from August 2 to August 11. Customers can view and try products but must order online. Local retailers are unhappy with Shein's tax practices.

▶🇺🇸 Alo Yoga and Steve Madden partner for fast refunds. Reshop partners with Alo Yoga and Steve Madden to provide instant refunds, backed by Afterpay co-founders and major investors. This collaboration aims to improve customer experience by eliminating refund wait times and offering immediate refunds.

▶🇬🇧 Gymshark’s Regent Street store surpasses goals. Gymshark eyes more stores in the US and Europe as its Regent Street flagship exceeds expectations. Founder Ben Francis highlights a quality-over-quantity approach. The next store opens in Westfield Stratford this weekend.

▶🇺🇸 Chloë Sevigny launches platform with Vestiaire. Chloë Sevigny and Vestiaire Collective launched a vintage shopping platform. The launch included a party in NYC. The platform offers vintage pieces from Chanel, Dior, and Margiela, with many items handpicked by Sevigny.

▶🇵🇱 Zalando to give $10 vouchers on UOKiK's order. Zalando is ordered by UOKiK to improve customer information and give $10 vouchers to customers who bought from platform partners since January 2023. This decision follows complaints about unclear seller information on Zalando’s site.

▶🇬🇧 Shein's Business Model Concerns Ex-Asos CEO. Former Asos CEO Nick Beighton expresses concerns about Shein’s London Stock Exchange listing. He highlights transparency issues and raises questions about the retailer's business model. A backlash grows, risking Shein's £50bn IPO.

▶🇱🇹 Vinted names Maurizio D’Arrigo as new CFO. Maurizio D’Arrigo is Vinted’s new CFO. He has 20 years of e-commerce experience, mainly at eBay. CEO Thomas Plantenga praised his multi-market finance expertise. D’Arrigo replaces Vaidas Urba, who stepped down in 2023.

▶🇮🇳 Amazon eyes stake in Swiggy Instamart for a potential stake or buyout. This move comes as Swiggy prepares for a $1.3B IPO and Amazon works on its quick commerce plans. Discussions are early and complex.

▶🇫🇷 Just Eat plans to close operations in France. The move aims to boost profitability. Financial details are undisclosed. The French market is a small part of Just Eat Takeaway.com. Support for employees is promised.

▶🇪🇺 Delivery Hero faces EU cartel probe. The European Commission is probing Delivery Hero and Glovo for alleged anticompetitive practices. The investigation, which follows raids in 2022 and 2023, will examine if the companies shared market info and avoided poaching employees.

▶🇬🇧 Tesco launched a new marketplace with Marketplacer on June 4th, adding 29 third-party sellers by July. This partnership enhances Tesco’s product range, improves customer experience, and boosts revenue.

▶🇮🇳 Swiggy revamps Minis to be a link-in-bio tool. This shift aims to assist small businesses and service providers like fitness trainers in reaching their audience through social media. Swiggy will keep its no-commission policy.

▶🇺🇸 Sam’s Club adds ads to Scan & Go tool. Sam’s Club launched display ads in its app’s Scan & Go feature to connect digital media with in-store shopping. Ads will appear on the cart page, helping track member behavior and ad performance. The tool will roll out to all members soon.

▶🇬🇧 The Perfume Shop joins Deliveroo with 1K products in cities like London and Manchester. Deliveroo data shows a 300% rise in perfume searches. The service will start in the coming months from 21 stores.

▶🇺🇸 DoorDash hires ex-Amazon exec for new strategies. DoorDash has hired Parisa Sadrzadeh, a former Amazon exec, to expand delivery services to include merchandise from major retailers like Target and Best Buy. This move aims to boost their sales and diversify their delivery options.

▶🇺🇸 Etsy allows AI art sales with new rules. Etsy will now allow AI-generated art on its platform, but sellers must disclose their use of AI tools and cannot sell AI prompts separately from the artwork. This policy aims to balance supporting artists and maintaining Etsy's handmade ethos.

▶🇪🇺 Meta faces $13.4B EU antitrust fine soon. This decision may come before November as Meta faces accusations of unfair trading practices. CEO Mark Zuckerberg denies the claims.

▶🇬🇧 Wayfair's profit slips to £2.6M despite job cuts. Wayfair UK's profit fell from £2.7M to £2.6M by December 31. Sales declined 17% to £69M. The company laid off 30% of staff, cutting numbers from 847 to 587, part of a $1.4B cost-saving plan. Strategy aims for European growth.

▶🇰🇷 Qoo10’s Korean Units Under Investigation. Qoo10's Korean units, TMON and WeMakePrice, are under investigation for delaying $123M in payments to 60K merchants. The companies face liquidity issues and halted refunds. Banks stopped loans, and merchants threatened to stop selling on the platforms.

▶🇪🇺 Billie integrates B2B BNPL with Stripe Europe. This allows Stripe’s business customers to use Billie's deferred payment options. The integration is seamless, with services activated in just a few steps. By June 2024, Billie reached 500K business customers, partnering with big names like Alibaba and Samsung. Stripe's commitment to innovation supports this growth.

▶🇸🇪 Klarna integrates Sofort (bank-to-bank service) with Klarna Payments, enhancing security and convenience for users. This merger allows Sofortüberweisung to be part of the 'Pay Now' product, improving the global payment experience.

▶🇬🇧 Boohoo launches new online marketplace with 200 fashion, beauty, and lifestyle brands, including L'Oréal, Garnier, Ray-Ban, and Michael Kors, aiming to become a one-stop shop for fashion, beauty, and lifestyle needs.

▶🇺🇸 ShipBob Plans $4B IPO for Late 2024. J.P. Morgan Chase and Citigroup will lead the IPO. ShipBob operates over 50 fulfillment centers globally and recently added Adam DeWitt to its board.

▶🇬🇧 Ocula raises $4.2M led by Praetura Ventures. Ocula is an AI for e-commerce startup from Belfast founded in 2021. Ocula plans to triple its client base in two years.

▶🇺🇸 Pitney Bowes sells e-commerce unit to Stord. The deal for e-commerce fulfillment services was confirmed on Friday, followed by a memo to Pitney Bowes staff. The company is still reviewing its Global E-commerce business, pressured by Hestia Capital Management.

That’s all. See you next week in the 🌀Maze!

Your guide through the maze

Artur Stańczuk Chief Strategy Officer at Packhelp, the leading European packaging marketplace. Previously worked ~8 yrs at Bain & Co. In the past, Digital Transformation Director at the leading Polish convenience chain Żabka and Entrepreneur that co-launched 3 startups