New data shows TikTok Shop is becoming a powerful economic engine for small businesses, with Latino entrepreneurs among the platform’s biggest beneficiaries.
TikTok Shop is no longer just a place where consumers discover viral products. It is increasingly becoming a major economic engine for small businesses, including thousands of Latino-owned companies across California.
New data released by TikTok Shop and reported by Modern Retail shows that sales from U.S. small businesses on the platform increased 66% in 2025 compared with the previous year. More than 215,000 small businesses are now actively selling through TikTok Shop in the United States, a 25% increase year over year.
For California entrepreneurs, especially those serving Latino consumers, the growth highlights a broader shift in how products are discovered, marketed, and purchased online.
The significance goes beyond e-commerce.
Research from Oxford Economics, Stanford University, and TikTok indicates that nearly 60% of Hispanic-owned small businesses attribute a meaningful portion of their growth to TikTok marketing. Approximately 86% report increased sales after actively promoting products or services on the platform.
Perhaps most striking, 44% of Latino- and Hispanic-owned small and medium-sized businesses say access to TikTok is critical to their business’s existence. That compares with just 36% of White-owned businesses reporting the same level of dependence.
For many entrepreneurs, TikTok has lowered barriers that traditionally limited business growth, including advertising budgets, access to investors, and expensive marketing contracts.
Instead of buying television commercials or hiring large agencies, business owners can reach millions of potential customers through short videos, livestreams, and creator partnerships.
California’s Latino Entrepreneur Economy Is Built for This Trend
California is home to the nation’s largest Latino population and one of the country’s most dynamic small business ecosystems.
Many Latino-owned businesses operate in industries that perform particularly well on TikTok Shop, including:
- Food and beverages
- Beauty and skincare
- Apparel and fashion
- Home products
- Specialty consumer goods
The platform’s emphasis on storytelling, authenticity, and community engagement aligns closely with how many small family-owned businesses already market themselves.
Unlike traditional online marketplaces where shoppers search for products, TikTok’s model revolves around discovery. According to the new report, 67% of consumers use TikTok Shop to discover new brands, surpassing Amazon’s 57%.
That discovery-first model can be particularly valuable for newer businesses that lack national brand recognition.
Another reason TikTok has become so important is consumer behavior.
Data shows Hispanic consumers are more than twice as likely as non-Hispanic consumers to begin product searches on TikTok. Hispanic users are also significantly more likely to use the platform as a primary product research tool before making purchases.
Businesses that incorporate Spanish-language content often see stronger engagement. Studies show Spanish-language voiceovers can increase viewing retention among Spanish-dominant audiences by 57%.
For California companies serving bilingual households, that creates opportunities that many traditional advertising channels struggle to match.
Key Points
TikTok Shop growth in 2025:
- Small business sales increased 66% year over year
- More than 215,000 U.S. small businesses now sell on the platform
- Major brands including Ulta Beauty, Sally Beauty, and Disney have launched TikTok Shop storefronts
- TikTok Shop generated more than 103 billion e-commerce-related searches
- Transaction volume increased nearly 80% year over year
A California Success Story
One of the most notable examples comes from EZ Bombs, a Latino-owned food brand based in Hesperia, California.
The company reported generating approximately $18 million in sales during its first year on TikTok Shop, with roughly 85% of sales originating directly from the platform.
Its success illustrates how a relatively small business can scale rapidly when content, community, and commerce are integrated into a single platform.
The growth numbers are impressive, but experts caution against relying exclusively on any single platform.
TikTok’s future in the United States remains subject to ongoing political and regulatory discussions. Some business owners and industry analysts warn that companies should use TikTok as part of a broader strategy that also includes owned websites, email marketing, and other sales channels.
Still, the current momentum is difficult to ignore.
Modern Retail recently reported that sales from major brands on TikTok Shop nearly doubled year over year, while small businesses continued posting strong growth despite increased competition.
That suggests TikTok’s marketplace expansion is benefiting both emerging entrepreneurs and established retailers.
For Latino entrepreneurs across Los Angeles and California, the biggest takeaway may be that social commerce is moving from experiment to mainstream business channel.
As search behavior evolves and younger consumers increasingly discover products through creators instead of traditional search engines, platforms like TikTok Shop are reshaping how businesses find customers.
For many Latino-owned companies, that shift is creating opportunities that would have been difficult to imagine just a few years ago.
The businesses that learn how to combine authentic storytelling, cultural relevance, creator partnerships, and direct-to-consumer sales may be among the biggest winners of the next phase of digital commerce.
