Indonesia-listed e-commerce giant Bukalapak has announced that it will shut down its marketplace for physical goods. The move is part of a strategic shift to focus on virtual products, the company said in a blog post on Tuesday.
Starting Feb 1, 2025, sellers will no longer be able to list new products, and purchases of physical goods — home accessories, electronics, fashion, personal care products etc. — will end on February 9, 2025. Unprocessed orders will be automatically cancelled by Mar 2, 2025 and refunds issued to buyers.
Bukalapak said it will assure support for sellers during the transition, providing guidance and assistance to ease the process. “Thank you for your support, cooperation, and trust all this time!” wrote the company.
In a similar move, on Dec 31, 2024, Bukalapak closed its subsidiary Kingkong Meats, which focused on quick commerce.
A transformation is underway at the IDX-listed company to streamline operations and enhance core offerings to four key pillars: Mitra Bukalapak, gaming, investment, and certain retail services.
Based on the company’s earning calls in Q3 2024, Bukalapak CEO Willix Halim said the company is refocusing its efforts on virtual products and financial services tailored to small retailers while scaling back its exposure to wholesalers and discontinuing most of its SaaS offerings.
Meanwhile, Bukalapak’s gaming business, comprising Itemku (C2C marketplace) and Lapakgaming (B2C marketplace), has emerged as a bright spot. The company has maintained a strong position in Indonesia by offering the lowest prices for gaming SKUs and is now eyeing expansion into other ASEAN markets, particularly the Philippines and Malaysia, where gaming preferences mirror those in Indonesia.
“They [Itemku and Lapakgaming] provide the cheapest price for SKUs in gaming related to the Indonesian gaming market. Ultimately the reason to come to our gaming services is the price of our SKUs, and that has to stay the cheapest compared to buying it elsewhere,” added Halim.
According to the company’s filings, it has 57 direct and indirect entities that comprise all of its business. Previously, the company deconsolidated six entities, which are PT Recommerce Internasional Indonesia (RII), ItemX Technology Pte. Ltd (ITP), Recommerce Singapore Pte. Ltd, Circular Commerce Pte. Ltd, iPrice Ventures Sdn Bhd (IPV), PT Berkat Valas Indonesia (BVI), Fun People Together Pte. Ltd (FPT) and Cellar Technology Venture Pte (CTV).
Bukalapak also holds seven investments in associated entities, including e-grocery platform PT Allo Fresh Indonesia – a JV between Trans Retail, Bukalapak, and Growtheum Capital Partner – in which the firm holds a 35% stake.
The third quarter has historically been Bukalapak’s weakest due to the seasonality of the business affecting both the O2O and marketplace divisions.
Bukalapak recorded an adjusted EBITDA loss of 168 billion rupiah in Q3 2024, a 76% increase from 95 billion in Q3 2023, according to its filings with the Indonesia Stock Exchange. In the first nine months of 2024, the company’s adjusted EBITDA grew by 55% to a negative 193 billion rupiah from 429 billion rupiah in the same period in 2023.
“The numbers do not align with our goal to achieve profitability in 2024,” the company stated in its earnings release.
Looking ahead, Bukalapak hopes the restructuring impact to continue for another two quarters, with Q4 2024 likely to mirror Q3 performance. However, the firm is looking at a recovery trend beginning in 2025.
“We have taken out our guidance for the full year 2024, given the revamping process which has created some distortions to our financials, but we promise to provide updated guidance once the review period concludes,” Halim said during the call.
