Mexico is more than 10,000 kilometers from China. With only a handful of direct flights, it takes 16 hours to travel from Shenzhen to the capital, Mexico City—making it one of the farthest countries from China.
Mexico is an agricultural powerhouse. Its central plateau, bathed in abundant sunshine, serves as a major corn-producing region. Further south, the mountainous terrain and fertile volcanic soil of states like Chiapas once helped Mexico become the world’s fourth largest coffee producer. A mature coffee industry continues to take root.
At the same time, the country’s western and northern regions have attracted a wave of global automotive brands, thanks to its geographic position and sizable population. Cities like Monterrey and Guadalajara have become hubs for car exports, anchoring Mexico’s heavy industry.
In contrast, Mexico’s light industry remains underdeveloped. Local production struggles to meet domestic demand, with clothing styles that are basic and limited, and components that often fall short in precision and performance. As a result, imports continue to play a critical role in the supply chain.
In recent years, as internet penetration has deepened, Mexico’s e-commerce market has grown rapidly. According to the Mexican Association of Online Sales (AMVO), the country’s e-commerce sales reached MXN 658 billion—equivalent to around USD 37 billion at the time—in 2023, up 24.6% year-on-year—the highest growth rate in the world.
On February 13 this year, TikTok officially launched its Mexico site, inviting its first batch of sellers to join. Mexico has now emerged as a promising market explored by all four of China’s cross-border e-commerce giants: Shein, Temu, TikTok Shop, and AliExpress.
Sellers are exporting apparel and accessories, household goods, toys and stationery, and 3C electronics to the country through these platforms. As Southeast Asia becomes saturated with price wars and the US remains a policy minefield, Mexico is emerging as a viable new destination.
But Mexico is far from a flat or frictionless market. The language barrier alone can slow you down, especially if your Spanish is shaky. Lost packages and poorly trained local staff are common complaints. Even seasoned sellers run into snags, while newcomers often get a crash course in how steep the learning curve can be. Still, with global e-commerce heating up and geopolitics redrawing supply chains, entering the Mexican market is becoming less of a choice and more of a necessity—even if the road is full of potholes.
Two giants and rising challengers
Mexico’s e-commerce market first caught sellers’ attention in 2023 with a dramatic surge.
Zhao Dezhu, a longtime supplier of personal care goods to Mexican sellers, has since launched his own brand. “From July 2020 to the end of 2022, we couldn’t ship anything to the US, and Mexico was cut off too! The whole world was short on Chinese goods—if you had inventory in the US or Mexico, it would sell,” he recalled.
Even as the Covid-19 pandemic disrupted global markets, Mexico managed to become the fastest-growing e-commerce market in the world. It remains one of the few hotspots for digital commerce today.
But sellers landing in Mexico are quick to discover that the landscape is already dominated by two giants: Mercado Libre and Amazon.
Mercado Libre was founded in Argentina in 1999 and entered Mexico that same year. In 2023, its gross merchandise value (GMV) in Mexico exceeded USD 20 billion, with a market share above 50%. The platform now counts over 35 million active users and has more than 100 million product listings.
As a legacy platform, Mercado Libre is well-positioned to ride the wave of deeper e-commerce penetration. “This year, Mercado Libre is going all-in on its fully managed model. They are aiming for fivefold growth,” Zhao told 36Kr.
At a recent Latin America-focused seller event hosted by Chuhaijiang, a cross-border e-commerce analytics firm, co-founder Jia Yunhan struck a similar note. “Based on last year’s trends, we expect serious competition on Mercado Libre this year,” Jia said.
Then there’s Amazon, Mexico’s largest e-commerce platform alongside Mercado Libre. A 2024 report by Mexican antitrust regulator Cofece revealed that the two companies together command 85% of the local market.
Since entering Mexico in 2015, Amazon has invested MXN 110 billion (USD 5.3 billion) across logistics, construction, and more. Over 27,000 Mexican sellers are active on the platform, offering more than five million products.
That leaves limited room for Chinese platforms like Temu and Shein. In response, they’ve brought tried-and-true tactics—like heavy consumer subsidies and fast, small-batch logistics—to Mexico.
Shein set up a pop-up store in Mexico City in 2021, before officially entering the market alongside Temu in 2023. A report from Grupo Bursatil Mexicano (GBM) showed that as of April 2024, Temu had 15 million monthly active users in Mexico, compared to Shein’s 10.1 million.
Although Shein appears to have made earlier and deeper inroads into the market, Temu’s user growth has been difficult to ignore.
According to Brazilian publication NeoFeed, Shein founder Chris Xu personally inspected Brazil’s apparel supply chain in late 2021 and signed non-disclosure agreements (NDAs) with two factories to explore local production.
In neighboring Mexico, Shein has already brought local sellers onto its platform, according to company sources.
The “four little dragons” of cross-border e-commerce are targeting Mexico’s younger consumers who prioritize affordability over delivery speed. According to Mexico’s national statistics agency, the country’s population surpassed 126 million in 2020, with a median age of 29.
For platforms like Temu and Shein, even with giants entrenched, Mexico remains a fertile ground for growth.
Escalating local competition
Compared to Temu and Shein, TikTok Shop seems to be a step behind.
According to Mexican media reports from July 2024, TikTok Shop had been preparing to launch in Mexico but delayed the move due to instability in its core US market.
Chuhaijiang’s Jia told 36Kr that despite its official launch on February 13, TikTok Shop had already begun quietly onboarding products by February 7. Users with large local followings received early access notifications.
The first wave of TikTok Shop sellers in Mexico came from targeted invitations to top merchants across categories like 3C electronics and beauty and personal care. Unlike Temu’s aggressive consumer subsidies, TikTok Shop opted to support merchants with a full suite of creator product sampling subsidies—including both sample costs and shipping fees.
“TikTok Shop only invited fewer than 100 merchants at first, and since it coincided with the Lunar New Year, once backend access opened, the big sellers scrambled to connect with creators. By early February, some had already shipped 1,000–2,000 product samples,” Jia said.
Now more than a month into operations, TikTok Shop’s footprint in Mexico remains smaller than Temu and Shein, largely due to its entry requirements: only sellers with a local business license, legal representative, or domestic warehousing capability are allowed to join.
Chuhaijiang’s data shows that in early March, TikTok Shop was pulling in five-figure USD sales daily in Mexico by early March, with the average order clocking in at around USD 12—compared to the USD 20 average in the US. The platform’s top categories at the time were beauty and personal care, fashion apparel, and 3C electronics.
While TikTok Shop lacks a robust local inventory, Mexico itself is not short on goods.
In late 2024, the Mexican government launched a sweeping crackdown on counterfeit goods in Mexico City’s downtown, targeting a wholesale hub known as Yiwu International Trade City—not to be confused with its namesake in Zhejiang, China. The move has rattled white-label sellers who once operated exclusively offline. Even those not directly affected are now looking to shift online, wary of what might come next.
“The folks in Yiwu [International Trade City] are trying to move their offline inventory online to clear it out. But they don’t know how to operate content-driven platforms like TikTok, so they are dumping it on Mercado Libre at rock-bottom prices,” Jia said. “This year, competition in Mexico’s shelf-based e-commerce space is going to get intense.”
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Despite fierce platform competition, none of the players have solved Mexico’s deeper structural problems. The country still lacks the infrastructure to support seamless operations, making localization risky for sellers.
Zhao shared one such incident: “In August 2024, we shipped three containers to Mexico. One of them still hasn’t turned up. The logistics company won’t compensate us. The issue of lost shipments hasn’t improved at all.”
Even when goods arrive, warehousing is another hurdle. Zhao said that Mexico lacks the mature e-commerce infrastructure of markets like the US, making inter-platform stock transfers inconvenient and in-house warehousing a costly endeavor. Platforms may end up building their own industrial parks to support local operations.
Risk and opportunity often go hand in hand. Sellers pushing into Mexico believe it’s a blue ocean. But for platforms like Temu, Shein, and TikTok Shop, it’s just one waypoint in a broader global push, where the goal is to chip away at the dominance of entrenched giants.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Hu Yiting for 36Kr.