Temu Unveils Y2 Shipping Model

Amid Tariff Pressures, What's the Ideal Solution for Merchants and Logistics Providers?

Since entering the U.S. market in 2022, Temu has rapidly evolved its logistics models to adapt to changing regulatory and cost environments. Initially, the platform operated under a fully-managed model, where Temu handled all aspects of fulfillment—from warehousing and customs clearance to last-mile delivery—while merchants focused solely on product offerings. While this model guaranteed fast delivery and a consistent customer experience, it became increasingly burdensome for Temu amid rising operating costs and growing tariff risks.

In response, Temu rolled out a semi-managed model in 2024. This approach shifted responsibilities like pricing, inventory management, and product dispatch to merchants, while Temu retained control of logistics and warehousing. It was a more flexible alternative, but still required merchants to pre-stock inventory in overseas warehouses—an increasingly risky proposition in light of escalating U.S. import duties and policy shifts.

Now, with tariff pressures mounting and the de minimis exemption repealed, Temu is launching its next strategic move: the Y2 model.

Y2: A Strategic Pivot to Merchant-Driven Fulfillment

On April 27, 2025, Temu officially introduced the Y2 model, enabling merchants to take full control of their logistics operations. Sellers may now choose their own logistics providers to ship goods directly from China to U.S. warehouses or transfer stations, with Temu handling local pickup and final-mile delivery. Orders are shipped only after being placed, eliminating the need for pre-stocking and reducing the financial risks associated with unsold inventory.

In essence, the Y2 model resembles Amazon’s Fulfilled by Merchant (FBM) framework. It allows merchants to manage their own fulfillment workflows, providing more flexibility and efficiency—especially for new product testing and seasonal SKUs. Though delivery lead times may increase slightly, Temu preserves its core advantage of offering low prices to U.S. consumers while pushing customs and logistics risk onto sellers.

Powering the Y2 Transition: eTower’s Full-Stack Fulfillment Solution

To succeed under the Y2 model, merchants and logistics providers need the ability to integrate systems, streamline order handling, and operate with real-time visibility across geographies. WallTech’s eTower platform is uniquely positioned to support this transformation:

✅ Direct Integration with Temu and Other Major Platforms

eTower seamlessly connects with Temu and other major e-commerce marketplaces. It enables sellers to automatically pull order data, generate shipping instructions, and reduce manual processing errors.

✅ Connected to Global WMS Systems

The platform integrates with multiple overseas WMS (warehouse management systems), providing merchants and 3PLs real-time visibility into SKU-level inventory flows, inbound/outbound tracking, and warehouse task execution—perfect for post-order fulfillment under Y2.

✅ 100+ Last-Mile Carrier Connections Worldwide

eTower links with over 100 global last-mile delivery providers. Users can create shipping orders, print shipping labels (including Temu’s CALL codes), and track parcel delivery in real time—ensuring seamless end-to-end visibility.

✅ Optimized for Single-Item Fulfillment (Pick-and-Pack)

Whether handling small parcels, split shipments, or bulk orders, eTower offers tailored workflows that support label automation, order matching, exception handling, and cross-warehouse coordination—ideal for one-piece fulfillment models like Y2.

Digital Agility Is the Key to Thriving Under Y2

Temu’s Y2 model represents a major shift in cross-border eCommerce logistics, emphasizing merchant control, risk mitigation, and flexibility. In this new environment, sellers need more than basic tools—they require an intelligent, scalable system that connects the entire supply chain.

eTower delivers exactly that. With its robust platform architecture, plug-and-play integrations, and proven global reach, eTower enables merchants and logistics partners to operate confidently—achieving efficiency, compliance, and growth in the new era of merchant-driven fulfillment.

For more information about WallTech and our logistics SaaS solutions, Book a free Demo with us.