Low-cost e-tailers Temu and Shein put Swiss retail sector under pressure

Temu and Shein have won over scores of consumers for selling a vast selection of cheap goods — from clothing to homeware — that are shipped from China. Keystone-SDA

Most Swiss retailers are concerned by the stiff competition from China's low-cost online platforms Temu and Shein, according to a survey.

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More than 60% of retailers in Switzerland see the development of online platforms such as Temu, Shein or Amazon as worrying or very worrying, according to the Swiss Retail Federation’s sector barometer 2025, published on Tuesday. The federation surveyed 90 managing directors of companies about their outlook and concerns for 2025.

Furthermore, 70% of the companies surveyed felt strongly or even very strongly about the influence of the China’s Temu and Shein on Swiss retailing, compared with only 9% who said it was weak. Medium-sized companies in the non-food sector are feeling the impact of these low-cost platforms. Price pressures and competition remain the number one concern for Swiss retail in 2025, the survey shows.

+ Number of Swiss shops increases despite online competition

The volatility of global politics – polarisation, developments in the United States and China, wars in Ukraine and the Middle East – is also a top five concern, alongside a sluggish consumer climate, increasing pressure on margins and weak economic development in neighbouring countries. Small- and medium-sized companies are also very concerned about the general increase in regulatory pressures and the shortage of qualified personnel.

+ The decline of the luxury department store

But, according to the barometer, the industry has a more positive outlook at the start of 2025 than the previous year. Around 79% of the companies surveyed believe that sales will remain stable in 2025, despite difficult trading conditions, whereas a year ago over one in three still expected a decline.

Around 4% said they expect an above-average financial result. The sector forecasts prices to rise by an average of 1.2% for 2025, well below the 2.1% estimated the previous year.

Adapted from French by DeepL/sb

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