British Shoppers are Sleeping On £3,000 Of Savings Per Year On Goods As ‘Temu Bonus’ is Revealed

British consumers who shop directly from manufacturers are saving up to £3,000, according to a new study by economic consultancy Cebr. The research examines the impact of different distribution channels, where fewer intermediaries are in the supply chain, on average basket prices for UK households. 

Commissioned by e-commerce platform Temu, the findings reveal consumers could save £2,961 annually or £247 on average per month by buying directly from manufacturers. That’s 46% of consumers’ total category spend per month.

The direct-from-factory model enables businesses to offer consumers products at significantly lower prices than their competitors. Shoppers can save an average of £79 per month on clothes – 48% of the average household spend on dressing themselves. 

In fact, consumers can save £39 per month on other recreational items, gardens and pets when using direct-from-factory marketplaces – 48% of the average household spending in this category.

As UK households continue to grapple with the effects of higher living costs, the findings show that consumer savings represent 11% of the average annual income in the UK.

CEO at economic consultancy Cebr, Nina Skero says: “As online shopping continues to expand rapidly and becomes an increasingly prevalent choice for consumers, selecting effective selling channels is more important than ever.”

“By analysing consumer spending patterns and comparing prices across various platforms, we find that UK households could save nearly £3,000 per year by shopping on platforms which utilised direct distribution channels.”

A Temu spokesperson says: “Access to affordable, quality goods should not be a privilege for the few. By partnering with manufacturers and cutting unnecessary costs, Temu makes quality merchandise more accessible.”

“The findings show the direct-from-factory model enable consumers to buy the products they need and want, without being held back by financial constraints.“

Technology is transforming almost every space, including manufacturing and retail.  Digitalization is creating new opportunities for more flexible and responsive supply chains. That’s why platforms like Temu are capitalising on this trend with their direct-from-factory model. 

The Cebr analysis found that merchants and manufacturers gained a greater understanding of consumer preferences and product demand through a direct-from-factory model. As seen on platforms like Temu, this, in turn, helps meet consumer needs more accurately and avoids overstocking and unnecessary storage costs. 

The findings also concluded that import duty structures in the UK cannot explain most price differences between companies utilising different distribution models.

Main Image: South China Morning Post