#Asia Clash of Titans: More Indonesian conglomerates join e-commerce battle

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Astra Graphia, a joint venture between Salim Group and Lotte Group, and CT Corp are set to launch e-commerce platforms

battle

It has started to become a pattern, or at least a trend: With the Indonesian e-commerce market predicted to grow up to US$130 billion by 2020, every company seems to have its eyes on the subsector.

In the past year we have seen major Indonesian conglomerates launch a foray into e-commerce business and investment (Lippo Group’s MatahariMall and Venturra Capital, Sinar Mas Group’s SMDV, MNC Group’s BrandOutlet, and the latest being MAP Group’s MAP EMALL launch).

Apparently this is not the last of the conglomerates’ march into e-commerce, with at least three groups had confirmed within the last few months plans to launch an e-commerce platform.

e27 compiled the reports for your reading convenience:

Also Read: Officials say Indonesia’s e-commerce roadmap should be directive for foreign investment

Astra Graphia

Astra International’s subsidiary specialising in office equipments and services, Astra Graphia, announced in December they are set to launch an e-commerce platform called Axiqoe in 2016.

According to Astra Graphia’s Chief of Finance & Accounting Panji Nurfirman, the company had spent around IDR50 billion (US$3.6 million) on developing the system.

“The online shop will display thousands of items, initially for business-to-business, but will surely touch on business-to-consumer [sales] later on,” Nurfirman said as reported by The Jakarta Post.

“The plan is that Axiqoe will be a retail channel for various products. It’ll host the [Astra International] e-commerce brand and the conglomerate market,” he added.

Also Read: Revealed! 7 key points of Indonesia’s much-awaited e-commerce roadmap

Salim Group and Lotte Group

On February 19, Indonesian conglomerate Salim Group announced that they have signed an agreement with South Korea’s retail giant Lotte Group to form a joint venture for e-commerce business. With a plan to launch in 2017, the new e-commerce platform is the second such collaboration after Elevenia.

DailySocial reported that Anthoni Salim, Chairman of Salim Group, had been hinting about his plan to enter the e-commerce industry since September 2015.

The partnership will benefit from Lotte Group’s portfolio in Indonesia which includes a department store, 41 retail stores, and 31 fast food franchise outlets. Salim Group itself owns businesses in the food and beverage (F&B), infrastructure, logistics, telco, media, and real estate sectors. Also its 11,000 Indomaret minimart outlets might play a crucial role in the company’s e-commerce grand plan.

Also Read: Latest trends in Indonesia that e-commerce firms should take note of

CT Corp

This weekend, CT Corp announced plans to launch an e-commerce platform. Though the group’s founder Chairul Tanjung did not mention when exactly the new platform will be launched, he already set big goals for the new business line.

“We are currently preparing for e-commerce, because we expect ourselves to champion the market as soon as we walk into it. If we cannot become a champion, then there is no point in trying, because we have a complete business portfolio [to support the new platform],” said Tanjung as quoted by Detik.

CT Corp owns hypermarket chain Carrefour, the department store chain Metro, various hotels and theme parks under the management of TransStudio, media companies Detik and TransTV, as well as several fashion and F&B outlets. DailySocial reported that the new e-commerce platform will be a separate business entity from the group’s TransRetail, which covers all the group’s retail businesses.

Also Read: E-commerce giant eBay to set up an office in Indonesia

What we say …

There is no doubt that the Indonesian e-commerce sector is filled with promise. The Indonesian conglomerates entering the business also seem to know what they are fighting against (notably Tokopedia and Bukalapak). But considering the resources that they have in-store (pun intended) it seems the conglomerates are getting into stance and preparing to battle.

But to win this market, is it enough to have massive investment and an extensive network of businesses to support the platform?

Looking at the country’s top e-commerce platforms, they started out as small businesseses working out of the founders’ own garage — we suspect that it took more than just huge investment and networks for them to find success.

Do share your thoughts!

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