TikTok reportedly plans U.S. fulfillment centers
TikTok is reportedly paving the way to open a product fulfillment network in the U.S.
According to Axios, the China-based short video platform has been posting job listings for U.S.-based product fulfillment centers. The ads say the centers, which TikTok apparently has not yet built or leased, would be part of an "international e-commerce fulfillment system."
The more than 12 LinkedIn job listings also reportedly say the centers will perform warehousing, delivery, and customer service returns; as well as parcel consolidation and free returns in the longer term. TikTok also posted a listing for a Seattle-based employee to design a new e-commerce fulfillment center from the ground up. Click here to read more Axios coverage.
TikTok builds on U.S. e-commerce
While TikTok offers full-fledged e-commerce capabilities in global markets including the U.K. and Indonesia, the company has a less-developed digital retail presence in the U.S. In August 2021, TikTok partnered with e-commerce platform Shopify to bring organic product discovery and shopping tabs to select U.S. users.
Shopify is letting U.S. retailers using its service with a TikTok For Business account to add a shopping tab to their TikTok profiles. Shopify retailers can also sync their product catalogues to create a mini-storefront that links directly to their online store for checkout.
Shopify and TikTok have also partnered to bring product links to Shopify retailers, which can be used to tag products in organic TikTok posts. TikTok users can choose to shop directly from a participating retailer’s Shopify storefront or click a tagged product in their TikTok video, which will take them to the retailer’s online store for checkout.
"Our community has transformed shopping into an experience that's rooted in discovery, connection, and entertainment, creating unparalleled opportunities for brands to capture consumers' attention," Blake Chandlee, president, global business solutions at TikTok, said at the time the deal with Shopify was announced. "TikTok is uniquely placed at the center of content and commerce, and these new solutions make it even easier for businesses of all sizes to create engaging content that drives consumers directly to the digital point of purchase. We're thrilled to be expanding our partnership with Shopify and making TikTok more accessible than ever for their merchants."
TikTok comes under continuing U.S. scrutiny
As TikTok reportedly looks to invest in workforce and facilities to support expanded U.S. e-commerce, the Biden administration is continuing to express serious regulatory concerns which began under the Trump administration.
Citing possible ByteDance connections to the Chinese Communist Party, the Trump administration had been actively attempting to ban TikTok from operating in the U.S. unless it established a separate business with at least partial U.S. ownership. In a June 2022 tweet, Federal Communications Commission (FCC) commissioner Brendan Carr publicly called on Apple and Google parent Alphabet to remove the TikTok app from their app stores.
“TikTok is not just another video app,” Carr said in the tweet. “That’s the sheep’s clothing. It harvests swaths of sensitive data that new reports show are being accessed in Beijing. I’ve asked Apple and Google to remove TikTok from their app stores for its pattern of surreptitious data practices.”
In response, TikTok has publicly said 100% of its U.S. user traffic is now being routed to U.S.-based Oracle Cloud infrastructure as a default storage location and that it is developing additional steps to ensure the security of U.S. user data.
Security concerns have not so far stopped U.S. consumers or retailers from actively pursuing shopping-related activities on the platform, which focuses on user-generated short-form videos. Retailers including Walmart, Saks and Instacart have partnered with TikTok, and Bazaarvoice data indicates TikTok shopping levels grew 567% in 2021.