No adjustment, no sale! Temu hits a wall in this country

No adjustment, no sale ! Temu hits a wall in this country

Temu's popularity is obvious to all, and it currently has 70 sites around the world.

Of course, there are many countries that Temu does not cover, such as Indonesia. Although there are only rumors that Temu may enter this market, all parties in Indonesia have already expressed their attitude as if they were facing a major enemy.

The Indonesian Ministry of Trade recently stated that Temu cannot enter Indonesia because its business model is not applicable in Indonesia. Director Isy Karim said that Temu's business model is F to C (producer/factory directly to consumer), which violates local policy, namely Government Regulation (PP) No. 29/2021 on the Implementation of the Trade Sector, which stipulates that producers cannot directly face consumers.

Karim also mentioned that the Ministry of Trade has not received any application for electronic system registration or business license from Temu so far . Karim also said that Temu still needs to make many adjustments if it wants to enter the local market because it has many regulations that it must comply with.

The Ministry of Cooperatives and Small and Medium Enterprises ( KemenkopUKM) of Indonesia also warned about the possible arrival of Temu, saying that Indonesia's small and medium-sized enterprises could also be affected by the emergence of Temu. Minister Fiki Satari said that Temu's application should be rejected because it conflicts with local regulations.

Fiki Satari said that the government must strengthen supervision and relevant departments and agencies must jointly supervise this (e-commerce) industry because small and medium-sized enterprises are the backbone of the national economy.

According to the Ministry of Cooperatives and SMEs, the digital economy value of the country's MSMEs could reach IDR 4,531 trillion by 2030, given the potential to access a wider market in the digital ecosystem .

Meanwhile, Bhima Yudhistira, an economist at the Center for Economic and Legal Studies ( CELIOS), also asked the government to be cautious about Temu's application for entry. Bhima Yudhistira believes that with the rise of foreign e-commerce applications, Indonesia as a market will lead to the closure of many companies and large-scale layoffs, especially in the manufacturing industry.

Indonesian Minister Teten Masduki was previously concerned about the emergence of Temu because it could have a negative impact on Indonesia's micro, small and medium enterprises (MSMEs). Therefore, he suggested to the President to ban Temu from entering Indonesia.

Teten Masduki believes that in addition to being very cheap, Temu also avoids the distribution link in online trade, which has led to the elimination of a large number of jobs.

Indonesia's concerns are closely related to the impact of Temu on other markets. Take the East Asian market of South Korea as an example: due to the impact of Temu on the local e-commerce market in South Korea, they had to cut costs through layoffs and other means; in the offline market, many toy companies also stated that their market share had dropped significantly due to the impact of Temu, so they had to shift their attention to other markets.

Temu

Indonesia