As TikTok consolidates ecommerce operations under Beijing leadership, U.S. teams are left behind—literally and figuratively.
TikTok signals deeper trouble as its ecommerce dream unravels under tariffs, layoffs, and Chinese-led restructuring
The layoffs are here—and the message is clear
On May 21, TikTok’s U.S. ecommerce staff got an email that said, essentially: “Stay home. Changes are coming.” By the next morning, those changes had names—layoffs.
According to a memo obtained by Business Insider, TikTok is cutting roles across its U.S. ecommerce operations and global key accounts teams. Affected employees were informed via email and then handed off to HR for their two-month administrative leave and whatever severance came with it. This isn’t just a belt-tightening move—it’s a red flag about TikTok Shop’s future in the U.S.
Let’s be real: TikTok didn’t just wake up this week and decide it wanted to “optimize operating models.” These cuts come on the heels of plummeting U.S. sales, rising tariffs, a looming federal ban, and the internal power shift back to Beijing. The ecommerce team didn’t fail—the conditions around them collapsed.
The catch: TikTok’s U.S. ecommerce bet is unraveling
This isn’t the first sign of trouble. TikTok’s U.S. ecommerce business has been sliding since Q1 after tariffs kneecapped Chinese sellers, who made up the bulk of TikTok Shop’s early momentum. Some saw sales drop 25% month-over-month.
Onboarding stalled. Sellers spooked. And suddenly that “$100M Black Friday” stat feels like ancient history.
Meanwhile, ByteDance is centralizing ecommerce leadership under China-based execs like Mu Qing, who authored the layoff memo. He’s not a familiar name in U.S. ecommerce circles—but he’s calling the shots now. ByteDance pulled a similar move in Latin America, replacing local ops with centralized control.
This isn’t about efficiency—it’s about control.
Why it matters: U.S. sellers are left holding the bag
If you’re a brand that bet big on TikTok Shop in 2024, you’re probably sweating right now. The platform that promised “shoppable virality” is now burning bridges with its sellers, creators, and staff—at the exact moment trust matters most.
Let’s break it down:
- U.S. sales are down, especially from foreign sellers who can’t price through tariff chaos.
- Leadership is centralized in China, just as Washington intensifies scrutiny over data and ownership.
- A ban or forced sale looms, with ByteDance still scrambling for a buyer before the June 19 deadline.
- Internal morale is shot, with two rounds of layoffs in under 60 days.
And while U.S. staff get pink slips, TikTok is ramping up in Japan and doubling down in Latin America. ByteDance isn’t retreating from ecommerce—it’s just shifting the map.
The U.S.? Not worth the political headache anymore.
Operator POV: Don’t build your 2025 on TikTok Shop
This isn’t a platform you can bet your business on right now. The upside might still exist—but the volatility, the regulatory risk, and the internal chaos are flashing red. Even MaryRuth’s CRO called it “messy and unpredictable.” No one likes to build on quicksand.
If you’re planning your growth strategy:
- Don’t make TikTok Shop your primary channel.
- Diversify into more stable platforms: Amazon, Meta, even Shopify-led influencer integrations.
- Watch the June 19 divestment deadline like a hawk. That’s the D-Day for TikTok’s U.S. future.
And if ByteDance doesn’t close a deal by then? Expect another round of layoffs—or worse.
So what?
TikTok Shop is not dead. But it’s limping—hard. If you’re still treating it like a breakout channel in the U.S., you’re gambling, not strategizing.
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