Hong Kong’s Shopline shrinks two markets amid restructuring

In The Checkout this week, we look at the shake-up at ecommerce enabler Shopline, Shopback’s FY 2021 numbers, and Bukalapak’s latest O2O move. [Read from your browser]( The Checkout 🛒 --------------------------------------------------------------- Welcome to The Checkout! Delivered every Thursday, this free newsletter breaks down the biggest stories and trends in ecommerce. You can find past issues [here]( or [sign up here]( to receive future newsletters. Also, If you’re not a subscriber, get access by [registering here](. Written by Budi Sutrisno Journalist Hello {NAME} News about the layoffs at Twitter and the 11,000 job cuts at Facebook dominated the headlines this week. And for many at Twitter, the experience has been painful and dramatic as they were shown the exit door just days after billionaire investor Elon Musk took over the firm. Here at Tech in Asia, we have been [closely tracking]( tech layoffs across Southeast Asia, India, and China. We have two Big Stories this week, and the first one is about job cuts at ecommerce enabler Shopline. My colleague Ardi reports on the situation at the Hong Kong-based firm, which also has a presence in Southeast Asia. Somewhat similar to Twitter, the layoffs at Shopline followed some organizational changes in the company after it was acquired by one of its investors, Chinese livestreaming giant Joyy. The good news is that Shopline, which operates a Shopify-like model, appears to be still hiring for Singapore, Malaysia, and Australia. We also spotlight ShopBack, a familiar name in this region’s startup scene. The Temasek-backed shopping and rewards platform doubled its revenue in FY 2021 while narrowing its operating losses. ShopBack says its model remains relevant to both consumers and merchants even in this economic downturn. Meanwhile, for this week’s Hot Take, I look into how Indonesia-based Bukalapak has quietly entered the Philippines via its Mitra Bukalapak business. After achieving relative success in its home turf, can the ecommerce unicorn conquer a second market? – Budi  --------------------------------------------------------------- THE BIG STORIES 1️⃣ [Departures at Shopline after $183m Joyy-led takeover]( The departures involve around 80 people across several Southeast Asian markets, though Shopline has also started to build a team in Australia.  2️⃣ [ShopBack doubles revenue in FY 2021, trims operating losses]( Apart from expanding into South Korea and Vietnam, the company also launched a new voucher feature in Singapore and Australia during the year.  ---------------------------------------------------------------  THE HOT TAKE  Can Bukalapak’s SmartSari take on incumbents in the Philippines? Here’s what happened: - Indonesian ecommerce giant Bukalapak has officially [entered]( the Philippines through its online-to-offline Mitra Bukalapak service. - According to third-party estimates, Bukalapak’s SmartSari has been downloaded over 80,000 times on the Google Play Store. Since its inception in April 2022, the new app has gained around 22,000 active users in the Philippines. - This comes as Mitra Bukalapak continues to be [the biggest revenue generator]( for Bukalapak in Indonesia, with the number of registered merchants on its platform reaching 15.2 million in the third quarter of 2022. Here’s our take: It’s too early to tell how much SmartSari has contributed to Bukalapak, considering that it has only offered phone credits and game credits to date. A source with knowledge of this expansion told Tech in Asia that while Bukalapak didn’t disclose any financial details, it has only invested a small amount into SmartSari so far. However, SmartSari said on [its website]( that it will soon launch other services in the Philippines, including grocery, courier, and dropship services, which have been a game-changer for Bukalapak in Indonesia. Mitra Bukalapak, which helps warungs or Indonesian mom and pop stores procure physical goods to sell, has been growing exponentially since it was rolled out in 2017. Its revenue has reached over US$90 million in the first three quarters of 2022, exceeding the US$71 million generated by Bukalapak’s marketplace during the same period. Unlike in Indonesia where Mitra Bukalapak pioneered this model, SmartSari faces competition from established players in the Philippines that target the same market, most notably [GrowSari](. See also: [Mitra has flattered Bukalapak’s financials, but new challenges await]( Launched a year earlier than Mitra Bukalapak, GrowSari has a similar model - i.e. helping sari-sari stores, the Filipino equivalent of warungs - get inventory. It has raised around ​​US$77.5 million in capital so far. Although it’s much smaller compared to Indonesia, the Philippines’ fast-moving consumer goods (FMCG) market still has enough room for more players - a good sign for Bukalapak. As of 2019, sari-sari stores [accounted for 37%]( of FMCG sales in the Philippines. Meanwhile, Indonesia's conventional channels, which consist of both warungs and traditional markets, [took up over 70%]( of FMCG sales in the same year, but that number has dipped slightly due to competition from modern players like [Alfamart and Indomaret](. While [42% of warungs]( in Indonesia use Mitra Bukalapak, only [100,000]( out of the 1.3 million sari-sari stores in the Philippines use GrowSari. Apart from GrowSari, other existing players across various industries are taking a piece of the FMCG pie in the Philippines, including foreign firms like TrueMoney. The Thai fintech startup, which is backed by China’s Alibaba, partners with 20,000 sari-sari stores to offer remittance, mobile top-ups, and bill payments - areas that SmartSari will also tap into. But compared to other countries including Indonesia, the FMCG industry in the Philippines has been [slower to rebound]( from the Covid-19 pandemic. The sector is expected to go back to its pre-pandemic levels by the end of this year. However, with [more than US$1.5 billion dollar raised]( via its IPO in 2021, Bukalapak doesn’t have to rush. It has the cash to bankroll and cover potential losses from the new venture, hoping that SmartSari can replicate Mitra Bukalapak’s success back home. – Budi  ---------------------------------------------------------------  NEWS YOU SHOULD KNOW Check out Tech in Asia’s coverage of the ecommerce scene [here](. 1️⃣ Blibli has officially [listed]( on the Indonesian Stock Exchange, making it the third homegrown unicorn to debut on the local bourse after Bukalapak and GoTo. Blibli’s stock price reached US$0.029 apiece as of noon on November 8, with a valuation at around US$3.5 billion. 2️⃣ Udaan has fired 300 to 350 permanent employees in [a new round of layoffs]( a source told Tech in Asia. This comes after the Indian B2B ecommerce platform cut loose 650 to 700 contract employees. 3️⃣ Base, a D2C beauty and wellness startup based in Indonesia, has raised [US$6 million]( in a series A funding round led by Rakuten Ventures. 4️⃣ India-based marketplace Flipkart is putting its acquisition and hiring efforts on hold in order to reduce costs as its losses widened by more than 50% in the financial year ending in March, according to [Financial Times](. 5️⃣ Despite the impact of Covid-19 on spending, Chinese consumers have shown enthusiasm for the Singles’ Day, with 82 brands each posting over US$13.8 million in sales earlier this month, South China Morning Post [reported](.  --------------------------------------------------------------- That’s it for this edition - we hope you liked it! Do also check out previous issues of the newsletter [here](. Not your cup of tea? 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