China’s to shut down e-commerce sites in Indonesia and Thailand

By Stefanno Sulaiman and Sophie Yu

JAKARTA/BEIJING (Reuters) – China’s will shut down its e-commerce services in Indonesia and Thailand, pulling out of Southeast Asia after a deadly year for China’s retail and food sectors. technology. will end its services in Thailand from March 3 and in Indonesia from the end of the same month, its local websites said. Both units will stop taking orders on February 15.

A spokesperson said in a statement Monday that the company will continue to serve global markets, including Southeast Asia, through its supply chain infrastructure.

The company, which did not give a reason for the closures, started its e-commerce business in Indonesia as JD.ID in 2015 as a joint venture with Provident Capital, while the Thai platform was launched two years later with the largest in the country. central distribution group.

But failed to gain traction against bigger players such as Alibaba Group’s Lazada, Sea Ltd’s Shopee and GoTo Group’s Tokopedia.

The company, which also runs omnichannel retail brand Ochama in Europe, said in November that “new ventures” – including overseas units as well as other ventures such as JD property – accounted for only 2% of total revenue in the third quarter. .

In China, the company, like many of its tech peers such as Alibaba, has struggled with a slowing economy and the impact of strict COVID restrictions, which have led to cost cuts and worker layoffs.

While performed better than its peers, posting an 11.4% increase in revenue in the third quarter, its chief executive described the second quarter as the toughest since its IPO in 2014.

Nattabhorn Buamahakul, a Bangkok-based partner at Asia Group Advisors, said JD’s releases reflected the highly competitive e-commerce landscape in Southeast Asia, particularly Thailand.

“Online platforms are not only competing with each other, but also local operators, small businesses that have grown as payments become simpler, using social media like TikTok and Instagram as touchpoints with customers,” she said.

But Jeffrey Towson, a Beijing-based TechMoat Consulting partner, said had behaved more conservatively than its competitors in Southeast Asia when it came to marketing and grant spending, and he believed that they got out without losing too much money.

“JD is now moving away from the consumer side and focusing on Southeast Asian merchants, brands and logistics infrastructure that connects to Chinese consumers. This plays to their strengths,” he said.

(Reporting by Stefanno Sulaiman in Jakarta and Sophie Yu in Beijing; Additional reporting by Chayut Setboonsarng in Bangkok; Editing by Kanupriya Kapoor, Stephen Coates, Kirsten Donovan)

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