General

“Vietnam is ushering in the most serious wave of the new crown epidemic. Ho Chi Minh City, the country’s largest city and economic and trade center, has become a'severely-hit area'. Since August 23, Vietnam has implemented the most stringent prevention and control of'in place' since the outbreak. Quarantine measures..."

Most parts of Southeast Asia, represented by Vietnam, are currently in a state of "blockade."

At the same time, the recurrence of the epidemic has also increased the demand of Southeast Asian consumers for online purchases, thereby promoting the prosperity of cross-border e-commerce business. Take Indonesia as an example. In the near future, both platforms and sellers have set their sights on this place. What is the local attraction? This article will take a closer look.

Southeast Asia, where the epidemic is repeated, this market exudes light

The repeated epidemics in Southeast Asia have put the online economy in the entire Southeast Asia region, including Indonesia, on the fast track of development. The data in the e-Conomy SEA 2020 report shows that in 2020, the online economic GMV of Southeast Asia will reach the level of 100 billion U.S. dollars. As the largest economy in Southeast Asia, Indonesia, which enjoys a demographic dividend, will have an online GMV of 44 billion U.S. dollars in 2020, of which the GMV created by the e-commerce sector will reach 32 billion U.S. dollars.

According to PPRO data research, among the cross-border e-commerce sellers entering Indonesia, Chinese sellers accounted for 41%, nearly half. In addition to sellers, Chinese e-commerce giants such as Alibaba and JD.com also have plans for the Indonesian market. Such as Ali's Lazada e-commerce platform and the leading local e-commerce platform Tokopedia. In addition, JD’s Indonesia station is also a leader in this market, and it has successively invested in companies such as Tokopedia, an e-commerce platform, and Go-Jek, a travel platform.

And logistics service companies supporting cross-border e-commerce will also not miss this "treasure land." One-stop international logistics online service platform-"Where to go" is also in the two major markets of Indonesia and the Philippines. "Where to ship" cross-border e-commerce Southeast Asia/Latin America regional leader Lu Daming said, "From the perspective of the population size of Southeast Asia, Indonesia is the first and the Philippines is second. The market potential is the largest. In addition, cross-border e-commerce in recent years The growth rate of Indonesia and the Philippines is also very fast. These two points are the main reasons for "Where to ship" to choose these two markets."

Why has the Indonesian market received much attention? Has a greater relationship with these points

1. The Internet penetration rate is high, and the average online time per capita has increased

According to a research report by statista, from 2015 to 2020, the local Internet penetration rate in Indonesia has increased by 30.16%. It is estimated that by 2025, the Internet penetration rate in Indonesia will reach 89.3%.

According to relevant data from e-Conomy SEA 2020, in 2020, the number of online shoppers in Indonesia exceeded 130 million, and the average usage time per capita increased from 3.6 hours/day before the epidemic to 4.3 hours/day after the epidemic. Good penetration rate and online duration are laying the ground for the development of cross-border e-commerce.

2. Nearly 70% of mobile orders are completed by shopping apps

According to relevant data provided by J.P. Morgan, 58% of online consumption in Indonesia is done on mobile devices, and nearly 7 of every 10 online transactions are done through shopping apps. It is estimated that by 2023, mobile e-commerce will continue to grow at a compound annual growth rate of 20.3%.

3. The consumer group is younger, and social media is widely used

As a country with a large population, Indonesia has a large population of young people, among which millennials and Generation Z account for the majority of the Indonesian population. Young user groups use social media more frequently. Taking the second quarter of 2020 as an example, the main social media platforms that Indonesian social media users visited every day in the past three months were Facebook (89%), YouTube (83%), and Instagram (79%), Twitter (34%) and TikTok (24%).

Opportunities accompany challenges, what is the answer to Indonesia's logistics "stubborn illness"?

Although the development prospects of the Indonesian market are promising, the large number of local islands and relatively fragmented territorial distribution have brought great challenges to the logistics of cross-border sellers. In addition, Indonesia’s customs procedures are relatively complicated, and there is still a lot of room for development of infrastructure such as the Indonesian road network, which greatly increases the difficulty of the seller’s "last mile" delivery.

The year-end peak season is just around the corner, and local logistics arrangements are an important task for sellers who want to expand into the Indonesian market or those who have already taken the lead.

First, especially in the context of this year’s general environment, cross-border logistics port congestion, “lack of containers and containers”, etc., continue to increase prices; second, the peak season for foreign trade orders has advanced, and port capacity is under pressure, which also affects cross-border e-commerce sellers. A certain impact; third, as mentioned at the beginning of this paragraph, due to Indonesia's own geographical location, some remote areas have a long-term delivery time.

More importantly, the local customs clearance red light period is from December to March next year. The local customs will work with other law enforcement agencies to conduct strict inspections on import customs clearance. Customs clearance procedures require more procedures and take longer than before. If the operation is improper , It will incur more expenses accordingly. For some red license plates, they will be 100% checked.

Nowadays, it coincides with the peak season at the end of the year. What should sellers do in response to the above-mentioned problems?

The shipping schedule in Southeast Asia is relatively short. Compared with the impact of European and American logistics due to the epidemic, Southeast Asia has not yet seen the situation of hard-to-find and sky-high freight rates in Southeast Asia, and the timeliness of sea and air shipments have also been maintained at a relatively stable level. The seller only needs to prepare the goods reasonably according to the dynamic sales situation, select the appropriate logistics provider, and complete the customs clearance of the goods as soon as possible to ensure the overall timeliness.