Economic Impact of Shopping American-Made vs. Temu

Economic Impact of $1 Million in Sales Through AllForAmerican.com Compared to Temu, A Chinese Marketplace

All For American asked Appleseed – a consulting firm with nearly thirty years of experience in economic impact analysis – to assess the new venture's potential impact on the United States economy. In addition, All For American (AFA) asked for a comparison to Temu, a China-based ecommerce marketplace. 

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Executive Summary

Based on the methodology, Appleseed estimates that for every $1 million in orders, sales on the AllForAmerican.com platform would directly and indirectly account for:

• 12.6 jobs in the U.S., with $883,687 earnings (in 2025 dollars). In comparison, Temu accounts for 0.84 U.S. jobs. 

• $1,361,155 to the U.S. Gross Domestic Product (GDP). In comparison, Temu contributes $106,632 to the U.S. GDP.

• $2,671,108 in nationwide economic output. In comparison, Temu accounts for $201,969 in nationwide economic output, with the remainder going to China-based businesses. 

The below graphic compares these impacts to the same $1 million in orders on Temu. 

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Direct Spending Impact of $1 Million in Sales Through All For American

The direct effect of $1 million in All For American sales is the impact of direct spending in the U.S. by All For American and participating vendors in the four cost areas cited in the methodology. Its indirect effect is the effect of spending on materials and services purchased by AFA, its vendors, and other partners from other U.S. businesses (such as fabric used in the production of apparel, fuel purchased by air and ground carriers, leased warehouse space, insurance, utilities, etc.). Its induced impact is the impact of household spending by U.S. workers directly or indirectly employed in e-commerce conducted on the AFA platform.

Table 1: Impact of $1 million in AFA sales on the U.S. economy (earnings, GDP, and output in 2025 dollars)

 

Impact of $1 million in Sales Through All For American on Local, State and Federal Tax Revenues 

In addition to the impacts cited in Table 1, AFA would also contribute to the overall vitality of the U.S. economy through the taxes that would be paid by AFA, its participating vendors, and customers who use the platform to buy U.S.-made goods. Using IMPLAN, Appleseed estimates (as shown in Table 2) that $1 million in sales via AFA would directly and indirectly account for U.S. taxes totaling $345,539, including:

• $50,838 in local taxes (municipal, county, special district, etc.)

• $72,955 in state taxes 

• $221,746 in federal taxes

Table 2: Impact of $1 million in AFA sales on local, state, and federal tax revenues (in 2025 dollars)

 

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U.S. Economic and Tax Impacts of $1 Million in Temu Sales to U.S. Customers

Since it launched in the U.S. in 2021, Temu (owned and operated by PDD, a Chinese tech company) has been the fastest-growing e-commerce marketplace in the U.S. Temu offers a wide variety of goods at very low prices, and it has achieved its low-price position in several ways.

• The goods Temu sells in the U.S. are manufactured in China, primarily by small to mid-sized companies. PDD is known for aggressively recruiting manufacturers to their platform and then squeezing them to lower their prices.

• Temu uses J&T Express, a Chinese logistics company, to ship its products directly from Guangzhou to destinations throughout the U.S. The role of U.S. companies in this process is largely limited to providing "last-mile" delivery services, either by major carriers such as UPS, FedEx Ground, and the U.S. Postal Service or local trucking companies. As it does with its Chinese manufacturers, Temu uses its market position to keep its payments to these carriers as low as possible. 

• During the past few years, Temu has spent as much as $4 billion annually on advertising and marketing directed at U.S. consumers. Most of this expenditure goes to major digital media companies such as Meta and Google for online display advertising and marketing through social media. However, while this spending provides substantial revenue for U.S. media companies, much of the work that goes into it is done in China – for example, by China-based Meta employees working with their counterparts at Temu.

• Temu has been especially effective at exploiting America's "de minimis" rule, which allows parcels with a total value of less than $800 to be shipped directly to buyers in the U.S. without clearing customs, without being inspected, and without paying customs fees or import duties. This gives Temu a significant cost advantage compared to many other international companies selling into U.S. markets.  While both the Biden and Trump administrations moved to restrict the use of the de minimis rule, it is still in place at the time of publishing this post. 

• Finally, several analysts of global e-commerce have estimated that despite its very real cost advantages, Temu, on average, loses money on every order it fulfills – losses that in 2024 could total more than $1 billion. These analysts suggest that Temu is investing heavily in buying U.S. e-commerce market share, and once it has succeeded in driving out competition, it will begin to raise its prices.

One of the consequences of Temu's business model is that its sales contribute relatively little to the U.S. economy. 

Appleseed estimates (as shown in Table 3) that because most of the work of Temu and its partners is concentrated in China, every $1 million in sales by Temu to its U.S. customers directly supports less than one full-time-equivalent job. Based on the analysis in Table 1, Appleseed estimates that $1 million in sales on AFA will support fifteen times as many U.S. jobs as $1 million spent by U.S. consumers on Temu.

Table 3: Impact of $1 million in Temu sales on the U.S. economy (earnings, GDP, and output in 2025 dollars)

 

Similarly, we estimate that $1 million in U.S. sales on All For American will generate more than fourteen times as much in federal, state, and local tax revenues than $1 million in U.S. sales on Temu.

Table 4: Impact of $1 million in Temu sales on local, state, and federal tax revenues (in 2025 dollars)