(Bloomberg) — Indonesian e-commerce pioneer PT Bukalapak.com will stop selling physical goods, underscoring the cut-throat competition in a market where the likes of ByteDance Ltd.’s TikTok Shop and Sea Ltd.’s Shopee are vying for users.
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Bukalapak will focus on sales of virtual products like mobile credits and electricity tokens, it said in a statement. Buyers won’t be able to place orders for physical goods after Feb. 9 and purchases that haven’t been processed by early March will be canceled.
The company has fallen victim to an intense fight for customers in the country of about 280 million people, seen as an attractive market by its bigger international rivals. Since Bukalapak sold shares in 2021 in Indonesia’s biggest initial public offering at the time, competitors like Shopee, TikTok and Alibaba Group Holding Ltd.’s Lazada have intensified their push in Southeast Asia’s largest economy.
Shares of Bukalapak fell as much as 7.4% in Jakarta, before paring losses. They have declined 86% since its IPO, leaving it with a market capitalization of about $750 million. In the third quarter through September, its revenue declined 15%, according to data compiled by Bloomberg.
Chinese giant ByteDance shook up the Indonesian e-commerce market a year ago by acquiring control of local online retailer Tokopedia. The Chinese company has ridden the success of its social media platform TikTok to become a major player in e-commerce too.
Bukalapak’s largest backers have included Singapore’s GIC Pte and Archipelago Investment Pte.
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