The country's first e-commerce unicorn is ceasing sales of physical goods to focus on digital goods and services, citing minimal revenue contribution, shift in demand and increasing competition since the company's founding almost 15 years ago.
omegrown e-commerce giant Bukalapak has defended its decision to cease selling physical items on its platform from February, as the segment contributes less than 3 percent to total revenue, saying it instead plans to focus on virtual products such as mobile credit, game vouchers and bill payment services to drive growth.
“Revenue from [sales of] physical products on the marketplace has been declining over the past three years, while operational costs have risen significantly,” Bukalapak director Victor Lesmana said at a press briefing on Thursday.
“Shutting down the [physical goods] service will not have a material impact on our revenue. On the other hand, it allows us to cut significant costs, which will positively impact our financial position.”
Founded in 2010, Bukalapak was among Indonesia’s first e-commerce companies. More than a decade later, it became the country’s first unicorn, or a start-up with valuation of over US$1 billion, and went public on the Indonesia Stock Exchange (IDX).
Victor also said the decision to stop selling physical goods aligned with the company’s earnings announcement in October 2024.
The company reported a net loss of Rp 776 billion (US$48.02 million) in the third quarter, 30 percent more than the Rp 597 billion recorded in the same period in 2023, while revenue grew just 2 percent year-on-year (yoy) to Rp 3.4 trillion.
Bukalapak attributed the loss to a significant shift in demand and an increasingly competitive domestic landscape that had driven a faster increase in operating costs compared to revenue, despite the company’s cost optimization efforts.
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