New details have emerged after one of Australia’s most popular retail brands was hit with a wind up order from the Federal Court forcing the closure of at least 51 stores.
Ally Fashion, an Australian-owned brand launched in 2001, has more than 150 stores in New South Wales, Victoria, Queensland, South Australia and the Northern Territory.
About 250 staff employed across the stores have lost their jobs due to the shocking collapse of the brand.
Last Friday, the brand received an order from the Federal Court to be wound up due to insolvency issues.
The Federal Court of Australia then appointed Jeff Marsden and Duncan Clubb of BDO Australia as liquidators of Ally Fashion Pty Ltd.
In a statement BDO revealed the appointment by the Court was made following an application by a landlord regarding overdue rent.
Ally fashion, one of Australia’s most popular brands, has been hit with a wind up order from the Federal Court, creating another massive ripple in the country’s retail industry. Picture: Supplied
“Following an urgent assessment of the business by the Liquidators, we have ceased operating 51 retail stores to improve the financial viability of the Company,” a spokesperson for BDO said.
However, the company has reportedly entered into a Licence Agreement with a related entity of the Director, David Dai, to continue to operate the remaining stores of Ally Fashion.
According to its website, clothes at Ally Fashion are designed by an in-house team for women who “like to express themselves through fashion & style”.
“With over 50 new styles arriving per week, Ally Fashion is well in demand and the destination for women who can transcend the fashion’s boundaries – defying the trends and creating her own,” it previously said.
Liquidator Jeff Marsden said, “Ally Fashion is a well-known Australian brand, with a dedicated team. The closure of underperforming stores and entering into a Licence Agreement will allow the business to continue operating in the short term whilst we urgently explore options to restructure, recapitalise or sell the business.”
The news comes as Australia’s retail industry takes a tough blow from cost-of-living pressures and recent inflation, making it increasingly difficult for businesses to meet their financial obligations.
Embattled fashion empire Mosaic Brands, which boasted brands such as Autograph, Noni B, Katies, Millers, and Rivers went into voluntary administration on October 28.
All 80 Katies stores shut down following the major decision, with 80 other stores across Millers, Rivers and Noni B also expected to close their doors.
About 480 employees lost their jobs due to the closures.
A shift in consumer behavior as thousands cut back on non-essential spending is understood to have led to the rise in insolvencies and businesses entering administration across all industries.
The Philippines has attracted top Japanese fashion and lifestyle retailers in show-casing Filipino products in their stores and in expanding their footprint in the country, the Department of Trade and Industry (DTI) said.
In a statement on Wednesday, DTI Secretary Cristina Roque said Adastria Co. Ltd. will expand its retail footprint and will explore local manufacturing while Etoile Kaito & Co Inc. is poised to increase sourcing of Philippine indigenous crafts.
The DTI said Roque spearheaded these collaborations during high-level discussions with the companies’ officials on March 3 in Tokyo.
“These strategic collaborations are set to significantly boost market access for premium Filipino products in Japan, attract substantial Japanese retail and supply chain investment, and showcase the nation’s rich creative talent on the international stage,” Roque said. “The exceptional creativity and craftsmanship of Filipi-nos deserve global recognition, and the Philippines is ready to take its place as a key player in the international fashion and life-style industry.”
Adastria, a leading Japanese apparel retailer with a portfolio of 45 brands, during a meeting with Roque, outlined plans to introduce more brands and explore local manufacturing opportunities, capitalizing on the Philippines’ growing retail mar-ket and competitive advantages, the DTI said.
Following the opening last December of Adastrias’s “niko and…” flagship store at SM Mall of Asia, the company aims to open multiple stores and introduce additional brands such as Global Work, Lowry’s Farm, and LAKOLE, the DTI added.
“Adastria’s expansion into the Philippines with the launch of ‘niko and…’ is just the beginning of what we hope will be a broader introduction of their diverse brand portfolio into the market,” said Roque.
She urged Adastria to consider local sourcing and manufacturing. A DTI briefer said the apparel retailer has 1,282 domestic and 127 international stores.
The briefer said Etoile Kaito, a prominent Japanese business-to-business wholesaler, is expanding its sourcing and diversifying its portfolio of interior and lifestyle products made from indigenous materials like capiz shells and abaca.
The DTI said Etoile Kaito will focus on importing a range of products, including flower vases, gardening pots, wall decorations, and fashion accessories like abaca bags and small containers.
Beyond sourcing, Roque said Etoile Kaitos expansion plans include introducing Japanese merchandise to the Philippine market through partnerships with established local distributors.
The DTI said Etoile Kaito has been working with the agency since 1988 to source products from the Philippines.
It added the company’s innovative hybrid model, seamlessly integrating digital platforms with brick-and-mortar channels, connects micro, small and medium enterprise manufacturers with an expansive network of 17,500 retailers in Japan and beyond.
Saudi Arabia’s supply chain transformation, driven by Vision 2030, emphasizes infrastructure upgrades, diverse trade relations, e-commerce growth, and free trade zones to enhance efficiency, resilience, and global logistics capabilities.
New Delhi, March 06, 2025 (GLOBE NEWSWIRE) — According to Astute Analytica’s latest market analysis, the Saudi Arabia supply chain market was valued at 560 million in 2024 and is anticipated to reach US$ 970 million by 2033, growing at a CAGR of 6.70% during the forecast period 2025–2033.
Saudi Arabia’s Vision 2030 is a groundbreaking strategic framework that is fundamentally reshaping the country’s supply chain landscape. This ambitious plan, launched to diversify the economy and reduce dependence on oil, has far-reaching implications for the logistics and supply chain sector. At its core, Vision 2030 aims to transform Saudi Arabia into a global logistics hub, leveraging its strategic geographic location at the crossroads of Europe, Asia, and Africa. The initiative has prioritized substantial investments in infrastructure, digital transformation, and workforce development, all of which are crucial elements in modernizing and enhancing the efficiency of supply chain operations.
One of the most significant impacts of Vision 2030 on the supply chain market in the country is the drive towards economic diversification. By promoting sectors such as manufacturing, technology, and logistics, the Kingdom is creating new opportunities for growth and innovation in supply chain management. This diversification is not only reducing Saudi Arabia’s reliance on oil but also fostering a more resilient and dynamic economy. The emphasis on digital transformation under Vision 2030 is particularly noteworthy, with the adoption of cutting-edge technologies such as artificial intelligence (AI), Internet of Things (IoT), and blockchain. These technologies are enabling real-time tracking, predictive analytics, and improved decision-making, which are crucial for modern supply chain operations. As a result, Saudi Arabia is witnessing enhanced visibility, efficiency, and sustainability in its supply chains, positioning itself as a competitive player in the global market.
Government investments in infrastructure: developing ports, airports, and road networks to improve logistics
Top Trends
Digital transformation: adoption of AI, IoT, and blockchain for supply chain efficiency
E-commerce expansion: increasing demand for logistics solutions, especially last-mile delivery
Sustainability initiatives: focus on green logistics and reducing carbon emissions
Top Challenges
Regulatory and customs barriers: complex procedures affecting cross-border logistics efficiency
Infrastructure and capacity constraints: need for further expansion to meet growing demand
Infrastructure Development Boosting Saudi Arabias Logistics Capabilities
The development of robust infrastructure is a cornerstone of Saudi Arabia’s supply chain market strategy to enhance its logistics capabilities under Vision 2030. The Kingdom has embarked on an ambitious journey of infrastructure expansion and modernization, with significant investments pouring into major ports, airports, and the development of a comprehensive rail network. The National Industrial Development and Logistics Program (NIDLP), a key component of Vision 2030, has allocated a staggering $133.3 billion for the development of essential infrastructure in airports, railways, and ports. This massive investment is set to transform Saudi Arabia’s logistics landscape, significantly boosting its capacity to handle international trade and positioning the country as a global logistics hub.
Key projects under this infrastructure development initiative in the supply chain market include the expansion of major ports such as King Abdullah Port and Jeddah Islamic Port. These expansions are expected to dramatically increase container capacity, facilitating better access to global markets and enhancing Saudi Arabia’s role in international trade. The development of a comprehensive rail network, including projects like the Saudi Landbridge, is another crucial aspect of this infrastructure push. This 1,300-km rail network will connect Jeddah on the Red Sea to Dammam on the Arabian Gulf via Riyadh, significantly reducing cargo transit times and improving trade route efficiency. These infrastructure developments are not only enhancing Saudi Arabia’s domestic logistics capabilities but also strengthening its position as a key player in global supply chains. By improving connectivity and reducing transportation costs, these initiatives are making Saudi Arabia an increasingly attractive destination for businesses looking to optimize their supply chain operations in the Middle East and beyond.
International Trade Relationships Enhancing Supply Chain Market Resilience
Saudi Arabia’s Vision 2030 has placed a strong emphasis on strengthening international trade relationships as a means to enhance supply chain resilience. The Kingdom recognizes that in an increasingly interconnected global economy, robust international partnerships are crucial for maintaining a stable and efficient supply chain. Saudi Arabia has been actively expanding its trade relationships with various countries, including traditional partners like the United States and emerging economic powerhouses such as the BRICS nations (Brazil, Russia, India, China, and South Africa). These diversified trade relationships help mitigate risks associated with geopolitical tensions or trade restrictions by ensuring alternative routes and suppliers are available.
The Kingdom’s efforts to enhance supply chain resilience through international trade are multifaceted. One key strategy is the implementation of the Global Supply Chain Resilience Initiative (GSCRI), which aims to increase foreign direct investment (FDI) in export-related sectors such as aerospace, pharmaceuticals, and renewables. This initiative not only strengthens Saudi Arabia’s position in global supply chain market but also contributes to the country’s economic diversification goals. Additionally, Saudi Arabia is focusing on developing cross-border collaboration and trade agreements. The establishment of free-trade zones and strategic partnerships with regional and global trade partners is helping to create a more resilient and flexible supply chain network. These efforts are complemented by initiatives to enhance domestic capabilities, such as localizing industries and developing strategic stockpiles of essential goods. By balancing international trade relationships with domestic resilience strategies, Saudi Arabia is creating a robust and adaptable supply chain ecosystem that can withstand global market fluctuations and disruptions.
Last Mile Delivery Innovations in Saudi Ecommerce Landscape
The rapid growth of e-commerce in Saudi Arabia has necessitated significant innovations in last-mile delivery, the final and often most challenging step in the logistics process across the supply chain market. As consumer expectations for faster, more convenient deliveries rise, companies in Saudi Arabia are leveraging cutting-edge technologies and innovative strategies to optimize their last-mile operations. Artificial Intelligence (AI) and Machine Learning are at the forefront of these innovations, with companies like Wahyd Logistics using these technologies to optimize delivery routes and forecast demand. These AI-powered solutions analyze data such as traffic patterns and customer preferences, resulting in a remarkable 25% reduction in delivery times compared to traditional methods.
Another significant innovation in the Saudi e-commerce landscape is the use of Internet of Things (IoT) technology to enhance shipment visibility and tracking. By equipping delivery vehicles and packages with IoT sensors, logistics companies can monitor the location and condition of goods in real-time. This has led to a 15% decrease in lost or damaged parcels, significantly improving customer satisfaction and reducing operational costs in the supply chain market. The exploration of automated delivery vehicles and drones is also gaining traction, with these technologies showing potential to reduce delivery times by 20% and costs by 15%. Furthermore, the establishment of micro-fulfillment centers in high-demand areas is enabling quicker processing and dispatch of orders, while the introduction of smart lockers is simplifying the returns process and reducing carbon emissions. These innovations, supported by Saudi Arabia’s Vision 2030 initiative and the country’s focus on technological advancement, are transforming the e-commerce logistics landscape, making it more efficient, customer-centric, and environmentally friendly.
Free Trade Zones Boosting Saudi Arabias Logistics Capabilities
Free Trade Zones (FTZs) have emerged as a powerful tool in Saudi Arabia’s arsenal to boost its logistics capabilities and attract foreign investment in the supply chain market. These designated areas, where goods can be imported, stored, and re-exported without being subject to standard customs duties or taxes, are playing a crucial role in simplifying international trade and enhancing the Kingdom’s position as a global logistics hub. The development of FTZs is a key component of Saudi Arabia’s Vision 2030 strategy, aimed at diversifying the economy and reducing dependency on oil. These zones offer numerous benefits, including tax exemptions, reduced customs duties, and simplified regulatory procedures, which collectively contribute to more cost-effective and efficient logistics operations
The impact of FTZs on Saudi Arabia’s logistics capabilities in the supply chain market is multifaceted. Firstly, they have significantly streamlined customs procedures, reducing the time and complexity involved in importing and exporting goods. This simplification leads to shorter lead times and faster shipments, enhancing overall supply chain efficiency. Secondly, the cost-effectiveness offered by FTZs makes Saudi Arabia an attractive destination for companies looking to optimize their supply chains, thereby strengthening the logistics sector. The strategic location of these zones near key logistics hubs such as ports and airports improves connectivity to global markets, reducing transportation time and costs. This positioning is particularly advantageous given Saudi Arabia’s geographic location at the crossroads of Europe, Asia, and Africa. Furthermore, FTZs serve as a magnet for foreign investments by offering a favorable business environment, which in turn increases demand for logistics services and contributes to the growth of the logistics industry in Saudi Arabia.
Cross-border e-commerce has emerged as a significant driver of growth in Saudi Arabia’s supply chain market, accounting for a substantial portion of the country’s e-commerce sales. As of 2023, cross-border transactions represented an impressive 60% of the total e-commerce sales in the Kingdom. This dominance is largely attributed to the competitive pricing, wider product selection, and brand variety offered by international platforms, which have proven highly attractive to Saudi consumers. A survey revealed that 72% of customers prefer cross-border retailers due to lower prices, while 47% appreciate the wider choice of products available. This consumer preference has not only boosted the e-commerce market but has also significantly impacted the logistics sector, driving demand for efficient cross-border shipping solutions and last-mile delivery services.
The growth of cross-border e-commerce has necessitated significant developments in Saudi Arabia’s supply chain market. The government, recognizing the potential of this sector, has been proactive in fostering a conducive environment for e-commerce growth, including cross-border transactions. Under Vision 2030, initiatives are underway to increase cashless transactions and expand the geographical coverage of e-commerce delivery beyond major cities. These efforts are part of a broader strategy to enhance the digital economy and support the logistics infrastructure needed for efficient cross-border e-commerce. However, the dominance of international platforms also presents challenges, including reduced revenue for the Saudi government and potential hindrances to the development of the local e-commerce industry. As a result, there is a growing trend towards supporting local e-commerce platforms, with projections suggesting that the share of cross-border e-commerce could decrease to 49% by 2026. This shift, coupled with government initiatives to support local businesses and enhance digital infrastructure, presents both challenges and opportunities for the future growth of e-commerce and its associated logistics sector in Saudi Arabia.
Astute Analytica is a global market research and advisory firm providing data-driven insights across industries such as technology, healthcare, chemicals, semiconductors, FMCG, and more. We publish multiple reports daily, equipping businesses with the intelligence they need to navigate market trends, emerging opportunities, competitive landscapes, and technological advancements.
With a team of experienced business analysts, economists, and industry experts, we deliver accurate, in-depth, and actionable research tailored to meet the strategic needs of our clients. At Astute Analytica, our clients come first, and we are committed to delivering cost-effective, high-value research solutions that drive success in an evolving marketplace.
Talabat Holding announced on Thursday the acquisition of 100 per cent of Instashop’s share capital from Delivery Hero SE. The sale and purchase agreement, initially revealed in September 2024, was fully funded through Talabat’s internal cash reserves, with a total consideration of $32 million.
Instashop, the leading online grocery delivery marketplace in the Mena region, is now a wholly-owned subsidiary of Talabat and will be effective and consolidated into its financial accounts starting February 25, 2025.
Instashop will continue to operate as an independent brand within Talabat’s grocery and retail vertical.
Founded in June 2015 and headquartered in Dubai, Instashop is a leading online marketplace that connects users with vendors, streamlining the purchase process and providing the necessary logistical capabilities to meet fast delivery expectations of customers. Specialising in the grocery and retail sectors across the UAE and Egypt, instashop offers a wide range of products, including groceries, pharmacy items, beauty essentials, and other personal care products.
In 2024, Instashop achieved strong growth, reaching $631 million in GMV, a 16% increase from $545 million in the prior year and equivalent to 8 per cent of Talabat’s 2024 GMV, with positive and improving EBITDA margins.
Following the acquisition, Talabat’s pro forma Grocery and Retail GMV1 for 2024 surpasses $2.5 billion, reinforcing its market leadership in the region.
NEW DELHI, March 6 (Reuters) – Indian consumer products distributors have filed an antitrust case against big fast-delivery businesses of Zomato, Swiggy and Zepto, calling for an investigation into alleged deep discounting practices, legal papers show.
India’s e-commerce sector has faced intense scrutiny over how products are priced online. An antitrust investigation last year found Amazon and Walmart’s Flipkart favour select sellers and resorted to “predatory pricing”, which hurts smaller retailers. The companies have denied the allegations.
Quick commerce, in which companies deliver consumer products within 10 minutes from neighbourhood warehouses, is popular with customers but has upset smaller retailers as shoppers use apps to order everything from milk to pulses. Bernstein estimates India’s quick commerce sector will reach $35 billion in 2030, from $200 million in 2021.
The All India Consumer Products Distributors Federation (AICPDF), in a case filing with the Competition Commission of India, has asked for an investigation into many business practices of Zomato’s (ZOMT.NS)
“An alarming trend of predatory pricing and deep discounting practices by Q-commerce platforms resulted in unfair pricing models,” said the group’s filing, which is not public but was reviewed by Reuters.
Zomato and Swiggy did not respond to Reuters’ requests for comment. Zepto declined comment. The CCI did not respond.
The filing could increase headaches for Zomato and Swiggy. A separate CCI investigation last year found their food delivery businesses breached competition laws. The case is ongoing.
Zepto is preparing for an IPO after raising funds at a valuation of $5 billion last year.
The watchdog will review the case filing and can order its investigation unit to look at the matter closely. This can take several months and may require companies to explain their businesses. It can dismiss the case if it finds no merit in it.
AICPDF has 400,000 distributors as members, who supply products of brands such as Nestle (NEST.NS), opens new tab, Unilever (ULVR.L) and Tata to 13 million retail shops across India.
A recent Datum Intelligence survey of 3,000 Indian quick commerce shoppers showed 36% had reduced shopping at supermarkets and 46% cut back purchases from small independent stores.
In its filing, AICPDF said local brick-and-mortar stores “cannot match” the quick commerce giants’ discounts. It compared online and offline pricing of 25 products, including of Nestle and Hindustan Unilever (HLL.NS)
A variant of a Nescafe coffee jar which a small independent Indian retailer receives from companies for about 622 rupees ($7.14) is offered for 514 rupees on Zepto, 577 rupees on Swiggy Instamart and 625 rupees on Blinkit, according to the filing.
Bumper crowds at the Australian Open tennis and summer of cricket lifted retail spending in January.
Retail turnover rose by 0.3 per cent in January 2025, according to the Australian Bureau of Statistics, as Aussies looked for a day out at their favourite sporting events.
This followed a volatile Black Friday and Cyber Monday period where November retail sales soared 0.7 per cent but December retail sales fell 0.1 percent.
ABS head of business statistics Robert Ewing says the pick up in retail spending since mid-year has largely been discretionary, with January being the exception and the rise mostly driven by food-related spending.
“Bumper crowds across large-scale events, including record attendance at the Australian Tennis Open and cricket events, lifted spending in catering services,” Mr Ewing said.
“Food retailing also rebounded in January, particularly in Victoria where supply chain disruptions negatively impacted December supermarket spending.”
Overall, food-related spending bounced back in January following falls last month, with rises in cafes, restaurants and takeaway food services (up 1.1 per cent), while food retailing rose 0.7 per cent.
Oxford Economics Australia head of macroeconomic forecasting Sean Langcake said while spending overall was subdued for January, the outlook going forward remained positive.
“The labour market is in a strong position, and inflation has fallen materially, leaving real incomes in good shape,” he said.
“Cost-of-living subsidies are providing a transitory boost to spending, while February’s interest rate cut helps shore up the outlook.”
Commonwealth Bank economist Harry Ottley said while consumer spending increased in January, it could be due to heavy discounting.
“It is also worth nothing the recent improvement in spending growth is coming from a weak base,” he said.
“This is especially true when considering high population growth and the weakness in the volume of spending.
“For context, the average annual growth rate for trend nominal retail trade from 2000‑2019 was 4.7 per cent, higher than the current rate of 4.1 per cent.”
KPMG chief economist Brendan Rynne said Tuesday’s data provided evidence of a stronger economy, which could be bad news for mortgage holders.
“This figure, together with the hotter-than-expected inflation figures last week, supports our forecast that the RBA will not follow up its recent rate cut with another in May,” Mr Rynne said.
“The data also support the RBA’s guidance to the market to be cautious about the scope for further rate cuts in the near term.”
Last week’s CPI data showed headline inflation remained steady in the month of January, at 2.5 per cent, but the all important trimmed mean inflation rate that the RBA uses went up from 2.7 to 2.8 per cent.
Spending in most non-food industries rose January, led by other retailing, up 2.4 per cent, and clothing, footwear and personal accessory retailing, which grew 2.0 per cent.
This was partly offset by a large fall in household goods retailing, which dropped 4.4 per cent as retailers stopped discounting items.
“The fall in household goods follows four straight rises driven by widespread discounting activity around Black Friday and Cyber Monday sales events,”
Retail turnover rose in six of the eight states and territories. The only exceptions being NSW, were spending fell 0.3 per cent in the month of January, and the Northern Territory where sales were flat.
Victoria drove the biggest contribution to national growth, up 0.6 per cent, largely on the back of the Australian Open.
In annual terms, WA came in first, with Victoria retail spending growth coming in second.
E-commerce has become a very large industry in the market today, especially for apparel. The Indian apparel industry has recognised this platform as a good way to increase reach and get their products into the hands of customers. Similarly, global conglomerates like Amazon have recognised this platform as a great way to export goods globally.
In order to give sellers a platform to enter foreign markets, Amazon hosted a conference on Export Connect 2025 in Coimbatore on 7th March 2025.
K. M. Subramanian, President of the Tirupur Exporters Association (TEA), who was among the attendees, said cross-border e-commerce is currently worth US $ 800 billion a year and is predicted to grow to US $ 2 trillion by 2030.
He also emphasised that, with an annual export value of over US $ 350 billion (2024), China is the undisputed leader, followed by the US at US $ 200 billion. India is currently ranked eighth in the world, with rapidly increasing e-commerce exports valued at US $ 3–4 billion. The Indian government has acknowledged e-commerce exports as a sunrise sector, and programs like Digital India and the newly announced Foreign Trade Policy 2023 are giving this sector a big boost.
He also underlined that although there are advantages, there are drawbacks, like insufficient infrastructure and obstacles to digital adoption. Many MSMEs and SMEs in India lack the resources and digital adoption needed to take full advantage of e-commerce platforms.
Honorary TEA Chairman Dr. A. Sakthivel, Joint Director General of Foreign Trade Anand Mohan Mishra, Business Head Srinidhi Kalvapudi, Marketing & Partnership Head Atul Bansal, and Sejal Ganpule, Advertising Manager, Amazon Global Selling, were also present at the event.
Together, we’re poised to not only elevate the Takealot brand but also redefine the e-commerce landscape with campaigns that resonate with South Africans
Takealot has joined Joe Public on a new journey to grow their business in the rapidly evolving and exciting e-commerce sector.
Takealot, ranked 27 in the Kantar BrandZ South Africa Report 2024, is a proudly South African brand and a leader in the country’s online retail market. Joe Public is both honoured and excited about this opportunity to assist in strengthening Takealot’s brand as it continues to shape the future of e-commerce.
“We’re thrilled to partner with this innovative brand,” says Mpume Ngobese, co-managing director atJoe Public. “We look forward to creating impactful, results-driven advertising that resonates with the everyday Joe on the South African streets.”
Julie-Anne Walsh, chief marketing officer of Takealot, adds: “We’re excited to embark on this new journey with Joe Public. Their creativity and understanding of our dynamic South African market make them the ideal partner. Together, we’re poised to not only elevate the Takealot brand but also redefine the e-commerce landscape with campaigns that resonate with South Africans.”
Retail giant Temu had a meteoric rise to become the most downloaded shopping app worldwide in 2024, but despite that success the platform’s expansion plans hit roadblocks in some South-East Asian countries.
Owned by Chinese multinational PPD Holdings and founded by billionaire Colin Huang, Temu operates in more than 80 countries including Thailand, Malaysia, the Philippines and Australia.
Temu is a shopping website and app that sells a huge range of products like clothing, household items, and electronics at extremely low prices.
Its marketing strategies include gamification and advertising heavily on social media.
Temu’s largest market is the United States, where it aired commercials at the 2024 Super Bowl urging consumers to “shop like a billionaire”.
But that same year the retail giant’s plan to enter an e-commerce market worth billions of dollars stalled.
Temu was blocked in Indonesia, South-East Asia’s largest and most lucrative e-commerce market, valued at $US82 billion ($128 billion), according to data company Statista.
The ban was intended to protect small business from cheap products flooding the country and to capture import revenue.
Similar concerns have been raised in Vietnam, where Temu’s operations were suspended in December after the trade ministry voiced concerns over product quality and the impact the online retailer might have on Vietnamese manufacturers.
Temu tried multiple times to register a trademark in Indonesia last year and each time the Trade Ministry rejected the applications.
In October, the ministry ordered Apple and Google to block the Temu app so it could not be downloaded in Indonesia.
But with a population of 280 million people, e-commerce analyst Simon Torring thinks Temu might make another bid to access Indonesia.
“Temu is in a stage where they just want to serve the world,” said Mr Torring, co-founder of e-commerce data firm Cube.
“Being the fourth-most populous country in the world, it is not tenable to ignore [Indonesia] or not be there.”
While Temu is blocked — and fast fashion competitor Shein doesn’t sell clothes into Indonesia — other e-commerce retailers are flourishing.
Trade rules halt Temu
Indonesia’s Trade Ministry said it rejected Temu’s trademark applications because of the country’s trade regulations.
Those regulations require goods to be imported into Indonesia by a third party — like a local wholesaler or retailer — if the goods are sent from countries that do not have an import-related trade agreement with Indonesia.
Temu connects manufacturers — which the company refers to as “sellers” who are mostly based in China — directly with consumers, cutting out these intermediaries.
Having a third party import goods into Indonesia is important to the country’s government because it guarantees that normal import duties and taxes are paid when the goods enter Indonesia, Mr Torring explained.
More of the final retail price is captured as domestic spending, he added.
Businesses cannot compete
The Temu ban is supported by Nandi Herdiaman, chairperson of the Bandung Garment Entrepreneurs Association that represents 8,000 home textile industry businesses across Indonesia.
Mr Herdiaman said Indonesians making clothing or other textiles for small businesses could not keep costs and product prices as low as items mass manufactured in China.
“We’ll definitely lose,” Mr Herdiaman said.
Other local industries, such as those making household items and electronics manufacturers would also be unable to “compete on cost” if Temu was allowed in Indonesia, said Muhammad Zulfikar Rakhmat, director of the China-Indonesia desk at the Jakarta-based Centre of Economic and Law Studies.
“They cannot match Temu’s pricing without sacrificing profit margins,” Dr Rakhmat said.
“Over time, this could lead to reduced market share and even closures for some businesses.”
Indonesia’s Trade Minister and Vice Trade Minister declined to comment.
While Temu is blocked, other e-commerce platforms like Shopee, owned by Singapore’s Sea Limited, and TikTok Shop and Lazada, owned by Chinese companies, are allowed to operate in Indonesia.
The key difference between these platforms and Temu is that the Chinese goods sold on those sites are imported into Indonesia by a trader or wholesale importer, Mr Torring said.
“Indonesia is very welcoming to foreign e-commerce players … it’s just that cross-border model that they don’t want,” he said.
“Local and foreign e-commerce platforms are allowed to operate if they are registered and if they are following business models that are legal.”
Mr Torring pointed out that many of the same items made in China are sold by the other online retailers in Indonesia, but the prices are higher because they use intermediaries in their supply chain.
He said Temu was now taking “serious steps” to change the platform’s cross-border model.
“In most of the western European countries and the US, most of the orders are actually fulfilled from local warehouses now.”
Temu declined to comment on the issues covered in this this story.
‘Nothing I can do’
Clothing business owner Dudi Gumilar is not concerned with which online retailers are allowed to operate in Indonesia.
“I don’t care whether Shopee, Temu, whatever, operate in Indonesia, I couldn’t care less,” he said.
For Mr Gumilar, the key issue is that Indonesian consumers still preferred to buy imported products over locally-made items.
It’s a well-known trend in Indonesia, which frustrated former president Joko Widodo who repeatedly urged consumers to buy items made in the country.
“Without the spirit of nationalism, the local small-medium businesses are doomed,”
Mr Gumilar said.
Mr Gumilar, who has run his company for two decades, said small to medium textile businesses needed more protection from the onslaught of imported goods.
“Nobody hears us even when we scream. There’s nothing I can do other than just working.”
Indonesia’s low de minimis
Indonesia was one of the first in South-East Asia to significantly reduce the country’s tax-free threshold for small or low-value packages.
Under the “de minimis” rule, parcels aren’t taxed if they’re valued under a certain amount — for example, in Australia that amount is $1,000.
Daniella Jacobs-Herd faces a decade of skin grafts after suffering severe burns from a Temu jumper purchased online, which failed to comply with Australian safety standards.
But in 2020, Indonesia reduced its threshold to a very low value, from $US75 to $US3 ($117 to $4.70).
Mr Torring said this low tax-free threshold prompted fast fashion brand Shein to leave Indonesia.
“It was no longer possible to be Shein in Indonesia. Shein is fast and cheap. Now it would be slow and not cheap,” he said.
“I would say that marked the start of when Indonesia’s e-commerce market was kind of closed to cross border e-commerce.”
Shein was contacted for comment but did not respond.
DHL eCommerce and AJEX partner to capitalise on anticipated double-digit growth rate in Saudi Arabia’s parcel market.
DHL eCommerce and AJEX Logistics Services have entered into an agreement in which DHL will acquire a minority stake in the Saudi Arabian parcel logistics company. “For DHL eCommerce, whose core business is domestic parcel transport in selected European countries, the United States, and certain key Asian countries, this agreement represents an expansion into the rapidly growing Saudi Arabian e-commerce parcel market. Although AJEX only began its operations in 2021, it has already established itself as a leading parcel service provider in the rapidly evolving domestic market, with robust growth and an extensive distribution network,” says an official release from DHL.
The agreement was signed during a ceremony attended by Pablo Ciano, CEO, DHL eCommerce, Yin Zou, Executive Vice President, Corporate Development, DHL Group, Mohammed Bin Abdulaziz Al Ajlan, Deputy Chairman, Ajlan & Bros Holding and Ajlan Bin Mohammed Al Ajlan, Group Managing Director, Ajlan & Bros Holding.
“As a key component of our corporate Strategy 2030 Accelerate Sustainable Growth, we are focusing on markets like Saudi Arabia that exhibit significant growth dynamics and strong economic development,” says Ciano. “We are confident that AJEX, with its commitment to quality and strong customer focus, supported by a highly motivated team and backed by Ajlan & Bros Holding, is the perfect partner to help us expand our e-commerce-focused parcel business into this booming market. Together, leveraging our international expertise in parcel operations, we will deliver reliable, affordable, and sustainable delivery solutions.”
With 1,500 team members, AJEX provides domestic parcel processing and delivery through an extensive network that includes over 50 facilities and a fleet of more than 900 vehicles.
Ajlan Bin Mohammed Al Ajlan adds: “Saudi Arabia is dedicated to fostering economic growth and diversifying its industries under Vision 2030 with logistics serving as one of the key pillars. In this context, we are also witnessing strong growth in e-commerce, which in turn is driving expansion in the domestic parcel sector. The demand for a parcel service provider with local expertise and a global network is steadily rising. By partnering with DHL eCommerce, a globally trusted e-commerce specialist, we will be well-positioned to meet this demand in the future.”
With DHL eCommerce, all four international divisions of DHL Group will be represented and actively engaged in the market. DHL first established its presence in Saudi Arabia in the 1970s with its DHL Express business unit. The other divisions have also been operating in the country for several years, providing specialised services such as contract logistics and freight forwarding solutions, the release added.
