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1, INTRODUCTION
3.7 Insight on Usage of Blockchain Technology
1.1 Scope of the Market
3.8 Insight on the ICT Infrastructure
1.2 Market Definition
3,9 Insights on China, Japan, and ASEAN relations
1.3 Executive Summary

RESEARCH METHODOLOGY
4.1 Drivers
2.1 Study Deliverables
4.2 Restraints
2.2 Study Assumptions
4.3 Opportunities
2.3 Analysis Methodology
ASIA CROSS-BORDER
2.4 Research Phases
BY BUSINESS
MARKET
5.1 B2B
3.1 Current Market Scenario
5.2 B2C
3.2 Technological Trends
SOUTHEAST CROSS-BORDER E-COMMERCE MARKET SEGMENTATION -
3.3 Government Regulations and Initiatives
BY PRODUCT
3.4 Insight onE-commerce Logistics (Infrastructure and Key Players)
6.1 Apparel, Footwear, and Personal care
3.5 Insight on mCommerce, Social Media Marketing, and Multichannel
6.2 3C and other Physical Electronic Appliances
Selling
6.3 Food and Beverage
3.6 Insight on Preferred Payment Methods
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6.4 Toys, Games, Books, and other Hobby Products

9. COMPANY PROFILES FINANCIALS"', PRODUCTS AND
6.5 Others (Homecare, etc.) RECENT DEVELOPMENTS

6.6 Travel and Tourism and other Digital Services 9.1 Alibaba Group

REGIONAL ANALYSIS !MARKE AND FOI'!EC:AS 9. 1,1 AliExpress

7.1 Singapore 9.12 Tmall

7.2 Thailand 9.1 .3 Alibaba.com

7.3 Malaysia 9.1.4 Lazada

7.4 Vietnam 9.1.5 Taobao

7.5 Indonesia 9.2Amazon

7.6 Philippines 9.3 ebay

9.4 JD.com (Jingdong)

8.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements 9.5ASOS

8.2 Market Concentration Overview 9.6 ezbuy

8.3 Strategies Adopted by Major Players 9,7 Vcanbuy

9.8 Etsy

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9.9 fade
APPENDIX
9.10 SGshop
11.1 Retail Sector Share of GOP for Key Countries
9.11 WeShop
11.2 E-commerce Sales and Other Relevant Metrics Connected to E-
9.12 Shopee
commerce and Retail Business
9.13 Qoo1 0 Pte Ltd
11.3 Insights on Cross-border E-commerce Goods Flow between Countries
9.14 Rakuten Inc.
11.41nsights on theE-Commerce Tax in Key Countries
0. OTHER PAYMENT
ECOMMERCE i::N0U:!Lt::r-t, TE<:H~IOLOG

COVERED IN THE REPORT *' Subject to availability on public domain

10.1 DHL, aCommerce, BoxMe, PayPal, RateX, Sing Post, SP

Commerce. Anchanto, Parcel Perform, Shipping Cart, POBox,
AsiaCommerce, and Jalur Nugraha Ekakurir (JNE)

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 of the Market

1.2 Market Detinitio'n

1.3 Executive Scrmm11rv

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The core market being captured here is the B2C first hand sales e-commerce market for physical goods

Cross-border e-commerce market sizes are the import market sizes or the consumption/purchase market sizes of cross border purchases at country level

The countries considered when capturing total market include Singapore, Malaysia, Indonesia, Thailand, Vietnam and Philippines

Sales of digital service and non-tangible items such as tickets, travel and tourism related online spending, digital versions of media, content, online games, etc. are
captured separately in section 6.6 of the report. All physical first time purchase goods are pooled together for the total market, which is further segmented in later parts
-in terms of% of cross-border imports from select countries.

C2C sales occurring on popular hybrid (B2C+C2C) platforms have been considered under the B2C segment only.

All market sizes captured in the report deal with new purchases only. C2C purchases of used goods, etc. are not captured in the report.

Goods categories covered in the report include:

1. Apparel, Footwear and Personal Care

2. 3C (Consumer Electronics, Communication and Computers) and other physical electronic appliances/goods

3. Food and Beverage

4. Toys, Games, Books and other Hobby Products

5. Others

Given the focus of the report is on the B2C segment (as per definition above), only brief insights are captured on the B2B market for the geographical scope here.

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The Southeast Asia cross-border e-commerce market (henceforth referred to as the
market studied) was valued at USD 7.042 billion in 2017, and it is expected to reach

Cross-border Market: Revr~nu:e USD USD 38.101 billion by 2023, registering a CAGR of 32.41% (henceforth referred to as

Southeast 7 <2023 the forecast period).

45.00

40.00 38.10 ASEAN Work Programme on Electronic Commerce (AWPEC) 2017-2025 facilitates
cross-border eccommerce in Southeast Asia, covering e-commerce initiatives in the
multiple sectors. The AWPEC was adopted by the ASEAN Economic Ministers (AEM)
c 30 00
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:D in September, 2017.
0 2500
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The countries of Southeast Asia, altogether, are home to more than 630 million
15.00 people and the region as a whole is the third-most populous in the world. This
10.00 presence of high population, along with the growing economies, increasing the

5.00 -7.04
penetration of internet and smartphones, and rising disposable income, drives the
market studied.
0.00
2017 2018 2019 2020 2021 2022 2023
Year
Singapore is a dominant player among the ASEAN countries in. c.rosscborder e-
commerce, with almost 50% of the online transactions that take place corresponding
to cross-border, which is more than the cross-border online sales in the countries, like
Japan, China, etc. The country's advanced logistics infrastructure also· supports the
growth of the market studied,

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MARKET DYNAMICS

SEGMENT & SUB-SEGMENT

ANALYSIS

KEY PLAYERS

COMPETITIVE LANDSCAPE

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2.2 ASSUMPTIONS ( 11 )

v' The base currency considered was the United States Dollar (USD). The conversion of other currencies to USD was considered based on the average exchange

rate for the respective review period years. The exchange rate conversion for forecast period was determined according to the base year's conversion rates.

v' The base year was identified based on the availability of annual reports and secondary information. The base year considered for this study is 2017.

v' The review period considered for this study is from 2012 to 2017. The forecast period and CAGR is from 2018- 2023.

v' Market size estimations for the forecast years were in real terms. Inflation is not part of the pricing and the Average Selling Price (ASP) was kept constant through

the forecast period for each country.

v' Distribution of primary interviews conducted was based on the regional share of the market and the presence of key players in each region.

v' As a result of data-triangulation through multiple methodologies and approaches, the weighted averages of resulting estimates were considered to be the final

values.

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3.1 Current M.erltet Sr.enano

3.2 Ttcnds

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lnsia!Jt on;mCom1nerc.e,

3.6 Prefened Pe;ynoe11t fJienwrls

3. 7 lnsiuht of Blockchain Tec!Jnoloqv

3.8 lnsiaht on the ICT lni'ra;structure

3.9 lnsiohts China. Janan.

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The e-commerce markets have certainly grown significantly in Southeast Asia over recent years. Since 2015, the number of internet users in ASEAN went from 244
million to 283 million, and this growth pattern is expected to continue at an annual rate of 18% until 2020. Despite this positive outlook, there is plenty of room for further
expansion in the e-commerce markets across ASEAN. Singapore, Malaysia, Thailand, Indonesia, Vietnam, and the Philippines all currently contribute less than 4% of
their retail sales online, a much lower proportion than the other e-commerce markets, such as the Republic of Korea (16%) and China (7%).

Evidently cross-border e-commerce will require the development of domestic e-commerce and improvements in terms of technological infrastructure, and in the regulatory
and legal environment, in which e-commerce firms operate across the region_ A broadband gap currently exists between the wealthier urban cities, such as Bangkok,
Kuala Lumpur, and Jakarta, and the more rural locations in Indonesia and the Philippines.

In some ASEAN Member States, broadband is expensive in comparison to the other developed countries, which limits access to e-commerce markets for ,_$ome
consumers, afthough the gfoW!h i-n mobile commerce is helping to address this gap. Cyber-security i-ssues are elsa regular across the region, due to which z. -sig-nificar1f
portion of consumers prefer not to provide banking details on!ine since, they feel that shopping in brick-and-mortar stores is more secure.

In order to support the development of the e-commerce markets across the region, and facilitate cross-border trade, better implementation of regulations across the
region is req•uired, sUch as customs and tax rules where disparities in the rt~ion.-The consumers are able to compare pri~es between different retailers more easily than
before. The Price comparison we-bsi.tes have enhan-ced price transparency for the consum.p,rs in man-y markets in the region.

In the case of competitors' prices they are now more visib1e to firms, which is prompting r-etailers to ir:1plement more flexible pricing strategies. This is being supported by
the inclusion of new technologies, such as automated pncing algonthms, which allow firms to keep track of and respond to the compelitors' pnce movements.

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Cross-border Payment- Southeast Asian countries are certainly ready to embrace digital payments but their existing infrastructure and ecosystem puts them at different
levels. In Indonesia, the lack of trust in payment methods is one major factor that reduces the customer engagement in e-commerce domestically and globally, with many
customers concerned over the payment security when purchasing online. The customers in Thailand, Malaysia, and Singapore are more ahead in terms of acceptance of
online methods and are more willing to make cross-border purchases online.

There are many payment solution providers, which act as aggregating intermediaries between banks and various payment gateways. By providing one-stop secure online
payment services, which support multi-delivery channels and multi-currencies, e-commerce platforms or mobile apps can be ready for business without the hurdle of
dealing with multiple financial entities or payment methods.

Flntech firms in recent years, from a!l over Asia, have been making progress in tackling cross-border payment challenges in Southeast Asian countries. The Silk Road
and Belt Technology Limi.ted, for example, launched a real-world working solution for_ easy cross-border corporate payments, that aims to make cross-bord<or tradoe
between Hong Kong and ASEAN countries more secut·e.

AI and blockchain technology for payment gateways- The company also u:;es artificial technology and.blockchain technology to improve B2B trading credibility and
reliability for small and medium enterprises. It has integrated itself with regional payment gateways in Indonesia, Cambodia, Australia, New Zealand, and Japan to bui!d a
bilateral trade platform to enable corporate payme.ntS electronically and cross-border 828 trading. Hong Kong companies that have production sites on the mainland can
also use this pl-atform for cross-border payments and remittance process.

Blockchain allows businesses to sell directly to the consumers without financial intermediaries. By adopting this technology, firms get to keep a larger share of sales
compared with traditional systems, which require them to pay commissions and/or foreign currency exchange fees, which reduce profits for domestic and cross-border
transactions

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C.-commerce businesses across Southeast Asia: are embracing new technologies for expansion. E-commerce applications provided by global technology companies, like

Google, Microsoft, Amazon, and Dell are being included within their own platforms.

Hong Kong companies that have production facilities on the mainland may tap lnt9 this platform to streamline the cross-border payment GJnd remittance process.
Blockchains can allow firms to sell directly to the consumers, excluding financial intermediaries. This allows firms to keep a larger share of sales compared with traditional
systems, where large commissions and/or foreign currency exchange fees reduce profits on both domestic (Lunden 2016) and cross-border transactions.

In Asia-Pacific, the domestic and foreign MNCs are adopting new and emergent technologies, such as cloud, big data, and artificial intelligence to regiona'l settings. In the
People Republic China, the Alibaba Group teamed up with Japan's SoftBank Group to form a cloud computing serv1ce venture, SB Cloud Corp (SB Cloud Corp. 2016). In
April, 2016, Alibaba acquired Southeast Asia's largest e-commerce website, Lazada, which is using Alibaba's big data and analytics services to improve the vendor sales.

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Uses of AI and Machine Rakuten in E-commerce

The algorithm in "supervised" ML uses past

Predicting sales A"sl.lpervised'' ML forecasts sales data to "train" the machine to predict future.
sales. more accurately

Real'time data helps identify most effective

An "unsupervised" ML algorithm segment customer ways of market segmentation (e.g., online
Market segmentation
groups to increase marketing- Canipaigri 8ffectiveneSS behavior or preferences) to more accurately
P.~ediCt the_ co~su.m6r intereStS ·or tcis.tes

"->- - ___ ':__ - - :' .---, __::::_:-___ --;_;·-·

, PrO:dUct cJassiffCation
A "seffii-supe1Vised'\ learning algorithm: classifies
Data is resampled repeatedly until the .a.lc'lrithm
pro_ducis in ways the custo[ners\vHL-tnor_elikefy--fihd-
-_·f.lndS U~e-'rfl6st. efficient vyay -to pro~-~-S~ (lata
th·e-items--tQey_,'!·eed

--"Structural·, !\~L algOrithms- analyze the -customer

Th!s is often used to study the structure and
Analyzing ratings and reviews ratings and reviews to more efficiently collect and
formation of words (morphology)
analyze product reviews and valuable information

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Region-wide Accessibility of
Broadband Infrastructure
Report
( 20)
ASEAN \1\/ork r~mmP on t··C<1011l1<±rce. 7·2025
INFRASTRUGTUR~···.
1.1 Identify gaps in internet Mapping ofpriority locations
-ac_cess,._affordability; and-neThvork _ req_uiring broadba~d d~ployment TELSOM
interoperability for private sector participation
Adoption of an A SEAN
1.2 Promote affordable access to
framework to provide affordable
international mobile rp<3tning TELSOM
intra-ASEAN mobile voice, SMS,
seNices.Jn ASEAN
. and data roaming se!'Yi9es
Development of next generation
1.3 Provide broadband access to
Universal Service Obligation
rural and underserved areas TELSOM
(USO) and telecenter
frameworks
Southeast Cross~Border E-Commerce
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INFRASTRUCTURE

2.1 Develop ASEAN guidelines

on accountability and
responsibilities of online Guidelines developed ACCEC
intermediaries (platform
providers}

Region-wide Accessibility
of Broadband Infrastructure
:~.2 D$\i8lop c,oordlri.at!9n '
mechanisr}ls- to -~n-hanc8-
/coO;rd(!l8tiofi ·nl~Chan-ism·
eilTOrce"r'n8nt of inte/18ctual AW(31PC
developeod
prOpert~' -rights in the. di9lt3'!
environment

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4. ConsumerRigl)ts Principles
for Online B2C Recognized
Develop guidelines/code of good
online business practice based on
5. Code of Conduct for Online
Business Developed
6. Consumer Rights
Awareness Enhanced
Report
( 22) ::::
ASEAN Work !; ... r:omm~rc:f! 7~2025
CONSUMER PROTECTJON
~ntegrate e:.ocomm_erce E-commerce considerations are
'
considerations_ into the_ASEAN reflected in theASEAN Consumer
ACCP
H igh:..l eve!- CdllSu me·r-P rOtectlon Protection High-level Principles
Prindples-
'
Guidelines de)leloped ACCP
selfcregufation best practices
Conduct regular consumertight ·· · . Consumers are aware of online
awaremesstraining forttie /;ghts as illustrated under the
ACCP
consumers and consumer ASEAN Consumer Empowerment
associations Index
Southeast Asla Cross»Border E~Commerce
3.3 ( 23)

A:St:AN Work Pro,ara 7-2025

CONSUMER PROTECTION

Establish ADR mechanisms, including

online dispute resolution systems, to
facilitate the resolution of claims over
7. Availability of Alternative
e~commerce transactions, with special
Dispute Resolution ASEAN ADR and ODR mechanism
attention to low value or cross-border ACCP
(ADR)/Online Dispute developed
transactions based on the best
Resolution (ODR) practice forf9ir, easy,to-use,
tr'ansparent, and effective ADR
mechanismS.

8~ 1.--o'~v~fb--p--P,-~Sit,N -GUide!iOes · G-u-id~-!in'8s ·are-- adO~p-(8:8:B) •

"Cross-border B2C cc)~pl~i~f
8. Regional/ International
Cooperation Enhanced _8_2 Develop a framewark-ofcross- 0

Framework of Cooperation Adopted

border cooperation in addressing ACCP
consumer protection issues

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3.3 GOVERNMENT INITIATIVES ( 24) ;;::

ASEAN Work E~commerce. 2017 ~2025

ASE/\N adopts an informal/formal

8.3 Develop informal/formal
-regional mechanism of cooperation
mech-anisms -for cro-ss-border
on cross-border complaints handling ACCP
. cdoperi'l\iOn,·suc,'J as anMOU ' --- -

arid ODR mechanism developed

8. Regional/ International 8A Participation in tiJe UN Inter~

Governmental Experts_ Consumer Participate in the UN fGEConsurner ACCP
Cooperation Enhanced
Protection Law(IGE Consumer. Protection Meetings
Pr9~E'!~ti~n) ·

8.5 Regular interaction with

international organizations conducted Interaction with UNCTAD/OECD
ACCP
regularly to enhance understanding, (seminars/workshops)
to learn best practices

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A~"=""' Work on E-commen::e. 2017-2025

MODERNISING THE LEGAL FRAMEWORK

National laws and regulations on e-

commerce covering the legal status
of electronic transactions/ contracts,
9. Updated E-commerce Legal
Voluntary internal and peer reviews the legal status of the e-commerce
Framework ACCPACCEC
of national laws/regulations on e- platform providers/operators, and
commerce merchants, electronic signatures,
online consumer protection, and
personal data protection reviewed

- - - --
10:Transparen["Nation131·Laws
Provide· cOmprehensive-updated·
and Rf'igulations on E. The information is publicly available
information on.dome-stic e;_ ACCEC
commerce inthe,ASEAN Trade Repository
commerce-related laws and
regulations

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 ";;;";;"'" Work ramme on E~commerce, 201

SECURITY OF ,fcLECIRONICTRAI\ISACTIQt;IS •
ldent!fy.best prectices· in Personal_ Data
11. Coherent and Comprehensive TELSOM
Protection (POP) to promote the
Framework for Personal Data Best practices identified
implementation of ASEAN PDP
!Privacy Protection Fram·ework

Study suitable mechanisms for

12. Interoperable, Mutually Voluntary adoption of the electronic
;:authenticqtion of electronic signatUres
Recognized, and Secure authentfcation mechanisms for cross-
and trade documents, based on TELSOM
Elec;tronic Authentication ~\order electronic trade documents
internationally recognized practices
Mechanism

Establish an international coordination

mechanism among cyber security
13. International Cooperation
agencies to share best practices, Coordination mechanism TELSOM
amongst Cyber Security Agencies
exchange information on policies, institutionalized
strategies, and cooperate in response

to cyber security incidents

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14. A Level Playing Field in theE-
commerce Sector
15. Improve ASEAIIJ Logistics
Services to Faciiitate E-commerce
16. ASEAN Agreement onE-
commerce
Report
( 27)
ASEAN
COMPETITI.ON
1. Competition assessment framework
Build and strengthen capacity of
for competition issues in thee-
competition authorities to identify I AEGC
commerce sector developed
detect and address anti- competitive
2. Training programmes and educational
activities in the e-commerce sector
materials developed
LOGISTICS
. Coordieation with rel<wan\ fl(SEAN
sectorial bodies and logistics service Stocktaking conducted and
ACCEC
• providers to identify measures- to recommendatioQS_ developed
improve A SEAN logistics services'
Support for e-commerce
• EcCOIVirvTERCEFRAMEWOR.K..
Review of the elements of A SEAN e-
ASEAN agreement on e-commerce ACCEC
commerce framework and develop an
signed
ASEAN agreement on e-commerc
Southeast Asia Cross-Border E~Commerce Market
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 INSIGHT AND KEY ( 28)

Logistics plays a very important role in e-commerce. It refers not just to the last mile delivery of parcels to customers, but also to the overall e-fulfilment
strategies.

Logistics costs are high in many Southeast ,"\sian e-commerce markets, who end up passing the costs on to their customers. Cost manageme-nt becomes one
of the biggest challenges to efficient e-commerce logistics.

Compared to other countries in A SEAN whose transport infrastructure is sti·ll underdeveloped, Singapore has the best transport infrastructure.

Cross-border e-commerce differs from local e-commerce not only in s-ite operations, but also in logistics arrangements. The e-commerCe site needs to be able
to adapt to the requirements of the customers, and be accepted by the market in the targeted countries. Similarly, for the logistics arrangements for cross-border
e-commerce, there is ~need to .oonsider various custom -regulations and fulfilment strateg-ies.

Last Mile Logistics .

.------ ---- ------------ -----

Container Pallet Big Boxes Small Boxes\

Recirculating Boxes
Customer Home

Collection Point

Delivery Point
E-commerce logistics activities

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 29)

Southeast Asia has certain unique last mile delivery challenges" The cost and capability of logistics providers in Malaysia and Thailand are highly ranked, but
there are last mile issues in the country that need to be addressed"

In Philippines and Vietnam, there are networks of small logistics players in metro regions, but shipping to the rural areas can be challenging" Indonesia
comprises of more than 15,000 islands with only 53% of the population living in cities, which is presenting massive logistical issues"

DHL, SingPost, SF Express, Post Malaysia, Bangkok Post Public Company Limited, and TNT Express are some of the major players relevant in the e-
commerce logistics market in the ASEAN region"

With the growth in the market, along with strong government initiatives, the logistics infrastructure for the e-commerce market is improving" The geographical
limitations of some of the ASEAN countries have been neutralized by improving logistics infrastructure.

Last mile is a major part of logistics in thee-commerce markets" With developing infrastructure and cohesive services by logistics providers, along with strong e-
commerce players, last mile is coming into prominence in the Sot~theast Asian market

Major e-commerce players in the Southesst Asian region are integrating logistics capabilities to provide a seamless service to the consumers. This is a major
change in the trend of the market

FTA has permitted relaxations in the logistics sector, due to ease of operations. Single window initiatives are. also contributing to the movement of players in the
e-commerce logistics market.

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DHL eCommerce, which is a division of Deutsche Post DHL Group, has expanded its involvement with the e-commerce company in the region after the
integration of DHL's e-commerce logistics services on Shopee's platform in Thailand.

The announcement win see se.!!ers on Shopee Malaysia have the option to ship their goods through DHL and be able to ensure that the products are delivered

to their buyers within the next-day to most of the locations across Malaysia.

1t has also been confirmed that Shopee's seiieis. can also access DHL service points that are stationed aroun-d the region, as a place to leave thei-r parce-ls and
have them dropped off to their shoppers.

0-HL eCommerce has launched domestic delivery aperations in Malaysia. DHL ecommerce's end-to-end domestic delivery solutions will offer pick-up services,
track and trace, reverse logistics, cash on delivery with daily remittance, and call center capabilities for deliveries within Malaysia. It aims to provide timely,
predictive, secure delivery.

Southeast Asia CrossKBorder E~Commerce Market Mordor

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 ( 31 )

Singapore Post Limited launched its regional ecommerce logistics hub located at the Tam pines Logistics Park. The SGD 182 million facility is Sing Post's largest
eCommerce logistics investment in Singapore. SingPost's eComm Log Hub is a three-storey facility housing two warehousing floors, 150 simultaneous loading
bays, as well as an office block. The ground floor of the building houses a fully automated parcel sorting facility with a capacity of up to 100,000 parcels a day,
and end-to-end sorting, shipping, and returns management capabilities that enable quicker order fulfilment. The total built-up area is 553,000 square feet.

Singpost entered into a non-binding memorandum of understanding (MOU) with Y Ventures on 2 March, 2018. According to DBS Equity Research, this will allow
the two to collaborate on an e-commerce buying platform, focused on cross-border purchases on behalf of consumers, and consolidated deliveries and a
logistics-related technology to enhance efficiency across the vertical logistics chain.

This is a good move for Sing Post, since for the last few years, it has gained traction in its international mail volumes, mainly from Alibaba, with international mail
accounting for 60% of its total mail volumes, as of March 2018. Singpost's new Regional eCommerce Logistics Hub is also able to handle large cross-border
volumes and utilize its parcel sorting machine for parcel deliveries .
...

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SF Global Express (M) Sdn Bhd partnered with a consortium of organizations to host the opening ceremony of the Malaysia-China Cross-border E-commerce
Sharing Platform (MCESP) in Kuala Lumpur, Malaysia. SF Global Express (M) Sdn Bhd is the designated logistics partner of the Malaysia-China Cross-border
E-commerce Shanng Platform, which provides integrated logistics solutions to merchants on the platform.

Already present in the Singapore and Malaysian market, SF has recently opened service centers in Vietnam and Tharland to further expand in Asia.
"

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Pos Malaysia Bhd's courier arm, Pos Laju, and PG Mall Sdn Bhd have signed a strategic partnership to formalize their e-commerce logistrcs partnership in the
region. The partnership would enable Pos Malaysia to serve more than 5,300 PG Mall's active merchants, daily.

Pos Malaysia Bhd has partnered with Singapore-based e-commerce logistics and selling platform Anchanto to strengthen its e-commerce warehousing facilities.
Under the partnership, Pos Malaysia will use Anchanto's warehouse management technology to expand its ability to provide a comprehensive e-fulfilment
service. The initiative is expected to generate a new business stream in thee-commerce fulfilment business.

MALAYSIA

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 <33 >
It is Southeast Asia's relatively young population and improved access to the Internet on mobile devices that propel the growth in mobile commerce. According
to an industry study, about 47% (306 million) of people in Southeast Asia are active social media users. 42 percent of the population (273 million) accesses
social media networks via mobile devices.

There has been a significant increase in mobile applications, which allows the people to shop online. Additionally, the absence of products in the local retail
market has allowed the consumers to browse the full range of products in the international platform thereby leveraging cross-border e-commerce market.

Apart from the traditional B2C e-commerce transactions, In most of the Southeast Asian countries, people use social media as a significant tool in marketing
their products and reach to other people within the country and beyond the borders. Social media is one of the significant parts of multichannel selling platform.
Social commerce sales were driven by social media, which is a potential game-changer fore-commerce in Southeast Asia.

It accounted for 30 percent of all online sales in the region in 2016 and will likely increase its share in the coming years. lncreasrng usage of mobile rs the
signi:ficant driver for. this scenario. Social media platforms offer greater accessibi:ltty-, mon& dynamic elements, and cost-effici·ency t:Jenefits comp-ared to email

blasts and online stores. These benefits are particularly vita! for small- and medium-sized enterprises and users with limited resources and expertise to maintain
websites.

!n Thailand, one of the world's bi_ggest social commerce market, 51 percent of online shoppers have purchased goods directly via social media channeL In
Malaysia and Indonesia, every third online shopper connects to a social m'edia network to buy products. The number of people who are adopting smartphones
has been significantly increased when compared to desktops and tablets.

For social and mobile commerce to be successful in the future, it is necessary to develop the essenti-al market infrastructure and legal frameworks to facilitate
transactions specifically across borders. One solution to unlock the region's e-commerce potential could be messaging apps. By engaging customers directly
online and making business communications more private, these apps could help build consumer trust in the online transaction process and partly address the
lack of security and confidence around online payments and delivery.

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OF ASIA REGION. JAN

94.93 . :}0:96

Urbanii:atitm 55% 44% . 100% 52%' 34% 76%

lnternef!Jsers·(mri) 132:7 4J1 46 50.53

~-

Penetration . 51% 58% 82% 67% 53% 71%

Active Social 1\iledia Us¢rs (mn) 106 60 4.40 46 46 22

Penetration 40% 58% 77% 67% 48% 71%

Mobile Subscription.s:f!')'1} 371 129.4 8.44 90.94 124] 42.93

Active Mobile Social Users (mn) 92 54 4 42 41 20

Penl)tration 35°/n 52% 70% 62.'/i 4:3% 65%

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Singapore

Singapore is a major country in the Southeast Asia region. It is regarded as the hub for and holds strategic importance for all global companies that wish to enter
the Southeast Asia market. Singapore is the most technologically advanced country in Southeast Asia and also has the most business friendly environment.

The Singapore Payment methods are dominated by Credit Cards where Visa and MasterCard are the major players.

Indonesia

The Indonesian geography is not completely covered by the bands and ATMs and this it has a lower share.

Cash on Delivery is a preferred method of payment in the Indonesia with ATMS coming second. The use of Credit cards is on the rise and is expected to grow
as the technology in the country develops.

Malaysia

It is one of the maJor markets in Southeast Asia and the effective logistics and improving payment services have allowed the ecommerce industry to grow in the
country.

Cash on Delivery and Credit Carq payment methods are the most preferred in Malaysia, while bank transfer is growing steadily. The infrastructure for payment
methods is also growing in the country.

Thail-and

Thailand has a presence of nev,; payment methods but the p;-eference of cash payments in still comparatively very high.

The other payment oplion rising in the country is the Ban transfer card payment.

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Vietnam

Vietnam is one of the highest cash dominated economies in the wgrld, with almost 90 percent of a!! transactions conducted in cash. Low banking penetration,

lack of AT!VIs and cashless systems, complexities of digit®! payment systems, consumers are compelled to fall back to cash based transactions. The Indonesian
geography is not completely covered by the bands and ATMs and thus it has a lower share.

Bank Transfer/ATM shar-e of payment is expected to !~crease with government taking steps to improve the number of ATMs a.nd encourag·ing the population of
have a bank account..

Philippines

Phi-lippines IS a wuntry that has a dominating cash payment method.

With a strong banking system in place theATM/ Bank Trans-fer payment method is also significant in the country.

Philippines has a strong d1g1tal growth and the increasing number of digital gateways are allowing the masses a new way for payment

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3.6 ON PREFERRED ( 37)

Prt,ferred Payrne<1t Methods: in Preferred in Philipp>ines, 2017

0.4%

m PayPal

ATMf Bank Transfer

Credit Card
41
-- Credit Cards

r Cash on Delivery(COD)

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 ( 38

Blockchain, the decentralized digital ledger system, is one of the technologies that is gaining huge popularity in recent times across various sectors.

The adoption of blockchain technology in payments enhances security, which is a crucial factor for fostering the cross-border e-commerce sales, and its adoption in
supply chain increases the visibility and aliov;s for tracking o-f the orders from origin to the destination.

The movement of information between third- and fourth-parties complicates transactions, and may lead to delay in supplier payments and disrupt the reconciliation
process. Leveraging blockcharn removes the medrators and simplifies the shopping process.

Blockchain technology can also result in paperless trade and the transparency in data helps to take smarter decisions regarding procurement, inventory,
investment, and financial positions_

A browser-based payments start-up in £ingapore, RateX, raised USD 2.3 million rn a pre-series A funding round. The browser
extension provides lowest exchange rates for overseas purchases and also aggregates coupon codes on applicable sales.

Foreign exchange rate is a crucial parameter in the cross-border payments and the company has saved more than SGD 500,000 in

both foreign exchange conversion fees and coupon codes, since the its launch.

RateX is developing Rate3, a universal token made specifically for e-commerce participants, including shoppers, merchants, and
even wholesalers, manufacturers, and logistics providers leveraging the blockchain technology.

The company uses its own payment network to increase the efficiency, and reduces the risk and fees associated with different
banks in various countries.

OCBC bank is the first bank in Southeast Asia to use blockchain technology in local and cross-border payment funds transfer

services. The bank conducted a successful pilot payment transaction with its subsidiaries, OCBC Malaysia and Bank of Singapore,
in 2016.
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Internet access, apart from indicating the e-commerce development, is also positively correlated with per capita income and education and also represents the
purchasing power in the society.

Singapore has better internet infrastructure and connectivity than the other countries in the Southeast Asian region, as well as in the world. The ICT sector in

Singapore is regulated by the Info-communications Media Development Authority (IMDA).

The government of Singapore announced an investment of SGD 2A to SGD 2.6 billion on Information and Communications Technology (ICT) projects, in 2018.
The domains of focus include communications infrastructure, data analytics, robotics, and cyber security and SMEs are expected to get the major share of
investments, which accounted for two-thirds of the total number of ICT contracts awarded by the government in 2017.

Indonesia is making significant progress in the development of !CT. The government of Indonesia expects that the ICT infrastructure in the country would reach the
second position in Southeast Asia by 2020. The Palapa Ring project is part of the broader Indonesia Broadband Plan (IBP) 2014-19 with a total investment of USD
23.2 billion and a government sp<ending ol USD 1.5 billion lor boosting connectivity in districts not yet served by bwadband.

The Pa!apa Ring project, which is a fibre-optic network that comprises 35,000 km of undersea cab!e, wi!! provide high-speed broadband connectivity across. the
country of Indonesia. The project improves the conn<ection speeds, with the download speed to almost 20 fv1bps in urban areas (from th<B current speed of 7 fv1bps)
and 1 Mbps in rural areas.

The groV>.1h in the ICT sector oi Thailand is stimulated by the government's plans lo cr<eate a digital economy with the 3rd !CT Master Plan and the National Digit;al
Economy Policy and Plan (2016-2020).

In 2015, the government allocated USD 571 million to build a national broadband infrastructure to prov1de affordable Internet to 70,000 villages (93% of total
villages), nationwide. The country also introduced 4G spectrum in 2015 with two auctions.

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The ICT sector of Malaysia contributed 13.1% to the GOP during the 1Qth Malaysia Plan (2011-2015) and the government is planning to increase this to 17% under
the 11 1h Malaysia Plan (2016- 2020).

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Singapore 96 97 22 38 737 100 903

Malay$ia 6 10 4 34 92 33

Thailand 5 18 9 18 65 97 45

lndone$ia 4 7 4 .8 7 60 16

Philippine$ 3 5 3 6 37 78 30
0

Vietnam 18 16 2 8 24 64 11

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Internet Infrastructure. ASEAN, 7

.Sing<lpore • 20.3 184.5 94 72

Malaysia 8.9 64.1 72 32 14

Thailand 16 106.6 97 72 43

Indonesia 7.2 66.1 76 18 5

Philippines 55 45. 39 11
Vietnam 9.5 59 86 37 11

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3.9 INS,Imns ( 42 >
In the twenty-first century, the presence of regional value chains in East Asia has become more prominent, captured in the term Factory Asia. The leading sector in
this process is electronics, although the phenomenon is evident in the other sectors. Regional value chains may involve many participants, but the manufactured
components for assembly in China come primarily from Southeast Asia.

Apple products are assembled in China by a Taiwanese firm, Foxconn. A large part of the value accrues to Apple for design and marketing, and to the tech
companies in the United S-tates, the United Kingdom, Japan, and South Korea for patent use, but most of the materia! components come from Southeast Asia,
especially Malaysia and Thailand. The hard disk drive industry, for example, is dominated by two US firms, Sea gate with 45% and Western Digital with 40% of global
sales. They employ over 45,000 workers in Thailand where over half of the world's. hard disk d~ves are produced; inputs are sourced from across Southeast Asia,
and output sold to computer assembly plant in China.

Relations within value chains tend to be more s-table than arms-length trading mlations, -but patte~ns do ehange. Vietnam is beooming a more significant partic-i-pant in
- ~

value chains, often replacing producers in eastern China where rising wages have eroded competitiveness. Cambodia is now providing some inputs to Thai firms,
although the magnitude of such trade is still small. Singapore used to supply components, but increasingly is a supplier of the ser1ices needed to glue the supply
chain. However, the changes are slow, and China's position in Factory Asia remains central.

The policy counterpart to these developments has been agreements to reduce the costs of doing business along international value chains. China not only joined the
WTO, but also signed the Information Technology Agreement, a voluntary plurilateral, under which signatories agree to remove all restrictions on trade in electronic
goods. Six ASEAN countries (Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam) have also signed the ITA, which is an essential prerequisite for
participation in electronics value chains.

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Shortly after joining the WTO, China and ASEAN signed a Framework Agreement on Comprehensive Economic Cooperation in 2002. This was a precursor to the
China-ASEAN Free Trade Agreement, China's first FTA, that entered into force in 2010. Some steps had been implemented earlier, to reap an early harvest. By 2018
all tariffs will be eliminated on goods trade between China and the ten ASEAN countries. Tariff elimination is not the centerpiece because much trade between ASEAN
and China was already tariff-free. The FTA involves deeper integration by also including services and foreign investment, as well as measures aimed at trade
facilitation. Goods trade between China and ASEAN increased from under USD 40 billion in 2000 to over USD 480 billion in 2014 and forecast to reach USD 1,000
billion by 2020.

China is working to reduce trade costs and strengthen trade ties with Southeast Asia through infrastructure investment. Two corridors, road and rail. between Nanning
and Singapore are planned, as well as an upgraded Kunming-Bangkok Expressway, and other rail projects. Following the 2010 ASEAN-China air transport
agreement, more frequent flights are connecting more cities in Chrna to Southeast Asian destinations. The 2013 announcement of the One Belt One Road lnitrative
highlighted the importance of China's commitment to infrastructure investment, and creation of the Asian Investment Bank promised funding to Southeast Asia.

ASEAN-China economic relations continue to thrive. China is currently ASEAN's largest trading partner, third largest external source of foreign direct investment
(FDI). Merchandise trade between A SEAl~ and China, reached USD 436.3 billion in 2017, accounting for 17.1% of ASEAN's total merchandise. Foreign Direct
Investment (FDI) flows from China toASEAN amounted to USD 11.3 billion in 2017 accounting for 8.2% oftotaiASEAN's FDI.

ASEAN and China signed an MOU on Transport Cooperation in November. 2004 in Vientiane. The MOU aims to promote medium and long-term cooperation .. ASEAN
and China signed two ;agreements on transport, namely i) ASEAN-China Maritime Transport l'.greement (AC-MTA) signed on November, 2 2007 and ii) ASEAN-China
AirTranspor1Agreement (AC-ATA) signed on November, 12 2010.

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3.91NSIGHTS ( 44)

ASEAN and China also agreed to expand cooperation to the area of production capacity cooperation. This would provide opportunities to further strengthen
economic and trade relations and serve to boost confidence and increase engagement among businesses from ASEAN and China.

China A SEAN Ecommerce

The cross-border e-commerce trade volume between China and A SEAN countries will increase by 50% in 2018, boosted by trade facilitation.

Products f[Om China and ASEAN have strong complementarib;. ASEAN countries have high demands toward high value-added industrial products from China.
Computer, communication, and consumer electronics products (3C products} make up the highest ratio of China's exports to ASEA1\l countries, with the second and
third places taken by health and beauty products and fashion accessories.

China mainly imports agricultural and high-quality specialty products from ASEAN countries, such as health products, latex pillows, milk powder, convenience foods,
brewed drinks, snacks, .and ri.ce.

Investment in cross-border e-commerce trade between China and ASEAN has been active in recent years. For example, Alibaba Group Holding Ltd took over
Lazada Group, one of the biggest e-commerce platforms in ASEAN, achiev1ng absolute control over the company. China's second-largest e-commerce company, JD,
joined hands with Thai company Central Group Co. Ltd to set up a joint venture, JD Central, in order to offer e-commerce and fintech services.

The Chinese companies' investment in ASEAN countries covers e-commerce, payments, logistics, and mobile applications" The technology and channel advantages
of Chinese companies can drive the development of related industries in Southeast Asia and promote the development of bilateral cross-border e-commerce.

The development of cross-border e-commerce trade between China and ASEAN remains at an average level.

Trade facilitation influences the development of cross-border e-commerce trade, and that high-level trade facilitation boosts the process in aspects, such as customs
clearance, logistics, and facilitation infrastructure.

Infrastructure construction is fundamental to the development of cross-border e-commerce.

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Well-developed logistics infrastructure can effectively reduce cross-border e-commerce operating costs and enhance the user experience of the consumers.

The financial bases..in most Southeast Asian countries are weak, and electronic payments are not widely used in the region, weak financial bases and low take up of
electronic payments limit the development of cross-border e-commerce.

China- ASEAN cross-border e-commerce platform was launched. The platform, also known aswwweshopasean.com, was hosted by CCPIT, Suning Group, and
ASEAN business associations in September, 2015, with the aim of building a portal for cross-border transactions of merchants and consumers on both sides. The
online goods include food, health products, daily necessities, beauty care, and other categories, covering 9 A SEAN countries. The trading volume reached 100,000
since its online test operation in September, 2016. Along with the rapid development of Internet technology, cross-border e-commerce has becorne a new engine of
bilateral trade. The official ceremony of the platform is of great significance to promote the development of China-ASEAN cross-border e-commerce and bilateral
trade.

ASEAN is currently pursuing an ASEAN Agreement on e-commerce, which will advance trade rules in e-commerce and build up greater digital connectivity, to facilitate
e-commerce flows in the region. It will provide a platform for aspiring entrepreneurs, start-ups, and micro, small, and medium enterprises (MSMEs) to market its
products and services reg,iona!ly, while making it easier for them io send and receive ef.ectronic payments. This is an area where ASEAN. can bene-fit from China's
experience and success, with a view toward strengthening 2nd facilitating ASEAN-China trade flows.

Industry cooperation initiatives will enable Philippines to take advantage of Japan's expertise "and experience as Philippines adopts these in the local industry setting.
Further improvements to Ph-ihppines' wi!f help to upgrade the local industries, allow them to better participate in global va!ue chains, and create more, better, and
higher value jobs for Filipinos"

The Japan has a major focus on the logistics support in the Southeast Asian countries. The players, like Yamato and Nippon Express have provided warehousing and
trucking facilities to thee-commerce players in the region.

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The Japanese players are themselves not actively present in the ASEAN e-commerce market, the possibility of B2B e-commerce with Japan is a strong
possibility.

After the withdrawal of Rakuten from the Southeast ,1\sian markets, Japan has observed rmproving profrts for players, like Aeon and Lottee through a-commerce
sales. The shift of Japanese brands toward e-commerce activities is expected to attract its attention toward the expanding Southeast Asian e-commerce market

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TECHNOLOGY AND IT
JNFRASTRUCTURE
INCREASING POPULII.TION AND ADVANCEMENTS
THEIR RISiNG DISPOSABLE INCOME

'J

UNCERTAIN CROSS-BORDER TAX LOOPHOLES AND PACKAGE

REGULATIONS HANDLING CHALLENGES

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 ( 49

The Southeast Asian region is home to more than 630 million people and is the third A relatively younger population who spends on products of fashion and
most populous in the world, which is equal to almost 8.5% of the total world gaming, is increasing the demand for the sales of these items that are
population. unavailable in their country through cross-border e-commerce.

Indonesia, Philippines, and Vietnam account for nearly 70% of the total population. The growing middle-class population is leading to a rise in the spending of

The economy of the region, as a whole, is the seventh largest in the globe. people on consumer goods. ASEAN is the third largest in terms of
consumer expenditures, with the percentage of GDP calculated as 26.3% in
The presence of a large population, growing economies, increasing penetration of
2016, which is equivalent to USD 1.47 trillion. Among the nations,
internet and smartphones, and rising disposable income are responsible for the
Philippines has the highest consumer expenditure of 42.1% of the GOP
growth of e-commerce in the region.
This g-rowing demand for consumer goods presents an opportunity for
Additionally, the presence of a large young population is also one of the main businesses to expand their activities in other countries through online
reasons for the growtb of the cross-border e-commerce in the reg,iOfL The median channels, thereby increasing the cross-border e-commerce sales.
age in Southeast Asia is 28.8 years.
Also, w1th relatively low labor costs, the manufacturing sector is one of the
The urbanization and the increasing purchasing power of the people are also driving main contributors to the economy of the region. The cross-border e-
the online cross-border sales in Southeast Asia. According to certain estimates, commerce websites provide the smaH and medium enterprises in the area
49.2% of the total population is urban. with opportunities to grow their businesses.

The growing m1ddle-class population in the reg1on is leading to the high demand for Moreover, the rise in the incomes of the people in Southeast Asia is

the consumer goods. According to an estimate, the total number of middle-class expected to take place at a rapid pace. In 2017, the median monthly

people in the A SEAN countries is anticipated to reach 400 million by 2020. income of a Singaporean citizen increased by 2% to SGD 9,023 from SGD
8,846 in 2016.
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Apart from these, the increasing penetration of smartphones and internet

a!so propels the cross-border e-commerce sales in the region. The
internet penetration rate in Southeast Asia stood at 57% in 2017.
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The IT infrastructure in Southeast Asia is developing at a rapid pace and Singapore and Malaysia are leading the development in the region. More than 40% of the global
internet audience is from the Asia-Pacific region, of which 10% of the population, i.e. 60 mil!!on internet users, are from Southeast Asia. Singapore and Malaysia have the
highest internet penetration in the region. Malaysia is on courSe to reach 100 per cent broadband penetration and has internet coverage of 63%, while Singapore has 75%
of internet coverage. In Indonesia, which has the highest population in Southeast Asia (i.e. 240 million inhabitants), nearly 15% of the population has access to internet.

The Southeast Asian region has a growing middle class and a rising internet penetration, making it a gold mine for e-commerce. Srngapore and Malaysia account for
almost half of the total online retail sales in the region, even though they are only 8% of the region's population. Singapore has the :,nost active users in the region
purchasing products through cross-border online shopping; two out of three people purchase more than once a year.

Social Media Penetration- The Southeast Asian countries have one of the highest Facebook penetration rates in the world. Although Vietnam has an "unofficial" ban on
Facebook, the penetration rates in Thailand, Philippines, and Indonesia are very high when taken as a percentage of all internet users. A majority of the internet users are

on Facebook and other similar social media platforms. Singapore and Malaysia have a more mature internet landscape compared to other Southeast Asian countries. In
both of the countries, about half of the population has accounts in Facebook and other similar social media. Twitter is also used in both countries. Around 16% of the
population in both Malaysia and Singapore is active on Twitter, which is making social media a marketing channel with high potential.

Influence of Social Media on Consumer Behavior- More than three-fourths of the population in Singapore research and compare reviews and pricing online, before
buying a product. They also give more importance to reviews given by fellow consumers than experts, due to which, social media reviews are having a huge influence on
consumer behavior. Nearly 60% of the population in Singapore share their experiences of products on social media, compared to the fifty percent globally. Social media is
also becoming much more popular in Malaysia, which is expected to drive the online cross-border shopping experience.

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 (53)

Consumers shop online from other countries for a few important reasons, such as the wider range of products of high quality, competitive offerings, and well established
brands who make sure they have a vast presence through marketing strategies. Consumers across the global markets are becoming more sophisticated and specific in
finding e-tailers, who are suitable for their preferences, when they shop through cross-border platforms because of all the advantages it offers.

Highlighting quality over the domestic e-tailers and brick-and-mortar retailers is a very important communication strategy, which is especially true in the Southeast Asian
countries where low quality and counterfeit products are widely known.

The Southeast Asian reg ron has a growing middle class and a rising internet penetration, making it a gold mine for e-commerce. Singapore and Malaysia account for
almost half of the total online retail sales in the region, even though they have only 8% of the region's population. Singapore has the most active users in the region
purchasing products through cross-border online shopping; two out of three people purchase more than once a year

The lack of a Goods and Services Tax on imported goods of USD 290 or less is also responsible for consumers in Singapore choosing this mode of online purchase.
Thailand and Malaysia also have a considerable consumer population; nearly every second, a person buys products online from foreign countries in these countries.

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Smartphone User Penetration (%), by Country, Southeast Asia, 2016-2018

. SIN.GAPOP.E

MALAYSIA 77.9% 81.8% 84.9%

VIETNAM 61.7% 71:6% 78.7%

THAILAND 62.5% 67.4% 70.9%

PHILIPPINES 41:7% 44.9% 48.0%

INDONESIA 35.8% 38.7% 41.0%

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Online consumers in Singapore and Malaysia are more inclined to buy from American websites. Amazon and Apple are among the most visited websites in both
countries. Several smaller American SMEs sell their products through platforms such as eBay, which is a popular website visited regularly by online consumers in
both Singapore and Malaysia.

Southeast Asian businesses selling abroad - In Singapore and Malaysia, the total import volume of goods and services bought online is much higher than the
export volume. Local businesses are beginning to become aware of the potential of e-commerce, and a few local merchants are already selling their products and
services abroad in small quantities. The size of the e-commerce export is estimated to be about 20% of thee-commerce import.

Advantages provided by cross-border e-commerce services -Cross-border marketplaces, such as Lazada, Shopee, Zalora, Zilinga, etc., have been key to the
increase in cross-border e-commerce activities in the Southeast Asian region. They offer online merchants advantages such as no listing fees, paying commission
only when products are sold, and providing them with a wide range of business management, distribution tools, and loQistic prog.ra.ms. Fo-r example, La.zada's cross-
border logistics lakes care of the export and import paperwork, customs clearance, ~nd last-mile delivery. Cross-border delivery usually takes three days, and if the
product is already in the local warehouse, it takes only one day for detivery.

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 4.1 DRIVERS (56)

Investments from foreign e-commerce companies -The recent entry of Chinese technology and e-commerce firms into Southeast Asia is pushing the region's
vast e-commerce potential. Chinese tech-related investments through companies such as Alibaba, JO,com, and Tencent grew heavily in 2017, Prime examples are
A!ibaba's investment in a major controlling stake in Lazada, and the joint venture between JD.com lnc. and the Thai retailer Central Group. The new digital
payment and logistics expertise associated within the Chinese investments will help the business-to-consumer (B2C) segment of a-commerce in Southeast Asia to
grow significantly, especially in cross-border sales .
•
Countries with less severe physical infrastructure constraints, such as Malaysia and Thai-land, are benefitting from the new wave of e-commerce deveJopment.
Thailand, in particular, is expected to experience a surge in e-commerce activities over the comi~g years, with many favorable factors enabling the overall e-
commeroe sector -to take off In the near future.

Business alliances between e-commerce entities - High-profile alliances recently formed, such as those between the Chinese e-commerce giants and large
Thai retailers, are providing the advantage of extensive offline distribution networks, A notable joint venture is the one between JO,com and Central Group, which is
a leading Thai retailer, Thailand already has decent infrastructure connectivity, and e-commerce logistics enablers for international deliveries have been emerging
as welL The government is also promoting e-payment adoption via the PromptPay scheme and use of QR codes,

Indonesia has a great long-term potential, with its large and fast growing middle class and young consumer market For example, when caught in the grid locked
Jakarta traffic, consumers are spending more time on internet In 2017, Alibaba invested USD 1,1 billion into Tokopedia, the largest C2C marketplace in Indonesia,

Lazada and Tokopedia account for the majority of the nation's e-commerce web traffic, while Shopee tops the mobile apps for online shopping, While the
enhancing of payments and logistics is important for e-commerce, online merchants should also emphasize on building trust with consumers and improving the
overall consumer experience by offering easy returns and maintaining user reviews,

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·-·-
Uncertain Cross-border Regulations - Complex border-crossing procedures, regulatory burdens, and unclear return processes are a hindrance to the development of
cross-border e-commerce in Southeast Asia. Although the sector is witnessing rapid growth, cross-border e-commerce could expand faster 1f various barriers were
eliminated to facilitate international trade to grow, consumer base to proliferate, and business opportunities for enterprises to expand.

Tax Loopholes and Package Handling Challenges- The rclpid grovvth in parcel flows has created congestion and valuation problems for customs officials in many
Southeast Asian coun-tries. Globally, onllne companies are facing cha_l!enges regarding the delivery of paCkages due to poor address systems. The e-commerce sector
·also has to deal with issues, such as duty and tax collection, transfer pricing, smuggling, and customs clearance, especially in the handling of incr-easing volumes of low-
value shipments.

Tec-hnological Leapfrogging -and Fragmented E-co.mm-erce Market- Online consumers in the Southeast Asian online market are essentially technology !P;:anfmns
Apart from first-tier cities, most of the pop-ulation is accessing platforms primarily through mobile nhrmP' Another characteristic that sets Southeast ,1\sians
from online shoppers in other markets is that orline consumers in this region choose from a large number of sites. As a result, there are no retail platforms that me
constantly preferred by more than 20% of consumers in any country 1n the

Emerging technologies have made it much easier to sell through different channels, but they also create a high degree of fragmentation in the e-commerce market.
Southeast Asian nations have classified platforms (such as Mudah and OLX), C2C sites (such as Tarad, Tokopedia, Bukalapak, and Shopee), B2C sites (such as Lazada,
Zalora, and MatahariMall), as well as international regional consumer brands' own sites. Fashion brands sell via marketplaces like Lazada and Zalora, and through their
own websites, or by distributing through e-tailers like Central Online and PT MAP Boga Adiperkasa (MAP Group).

Logistics and Delivery- Despite the fact that thee-commerce sector as a whole is enjoying tremendous growth in Southeast Asian countries, cross-border e-commerce
still faces barriers regarding logistics and handling. The most important barrier for cross-border e-commerce is logistics, more specifically shipping cross-border, because
it involves compliance with several rules and regulations.

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Logistics and Delivery - Despite the fact that the e-commerce sector as a whole is enjoying tremendous growth in Southeast Asian countries, cross-border e-
commerce still faces barriers regarding logistics and handling. The most important barrier for cross-border e-commerce is logistics, more specifically shipping cross-
border, because it InVolves compliance with several rules and regulatrons.

Due to the infrastructure for domestic delivery in Singapore and Malaysia, most of the packages can be delivered within one day and the costs are relatively low. But
the same is not true for other Southeast Asian natrons, for example Vietnam and Philippines. One of the most important issues merchants face when shipping via
cross-border in Southeast Asia is the high delivery costs. Shipping is very expensive in Southeast Asia, as the market for shipping is growing but ls relatively s-mall.
For example, Singapore customers receive two parcels annually compared to German customers who receive on average 30 parcels. The customs and duties that
need to be paid when goods are imported make the prices rise very significantly, making it less ffiltraotive for consumers to buy goods online from foreign countries.

Differences in payment methods - Constl'fners sti'll face concerns regarding the security of payments, identity theft, and currency fluctuations, which are
compounded by the cultural differences of consumers across the Southeast Asian countries, which requires unique marketing approaches and the availability of
websites in local language and local payment methods. Customers are not willing to experience any added surprises regarding the actual costs of the goods in
purchases. They are more comfortable paying in their own currency, which eliminates any exchange rate risk for the customer. Merchants are yet to convince their
entire online customer base that their identity and card information will be dealt with in a secure manner. Companies that provide payment solutions have to comply
with the latest international safety standards to ensure that customers are presented with a variety of secure online payment methods.

Monopoly positions for platforms can lead to unfair terms and unfair private-label competition. Platform lock-in can occur in two ways: MSMEs cannot move away
from a platform even if the terms are unfair because of their built-up reputation through customer reviews that will not transfer to a new provider, and MSMEs can
also be tied up to the services provided by the platform, such as training, IT services, financing, and operational processes, so that they find a move to a new
provider too costly. As there are large e-commerce players in the market, governments will naturally turn to them for advice on policy" With unrivaled monopoly power,
compared to the regulated industries of telecommunications or airlines, platforms will have the tendency to skew policy in favor of themselves.

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E-commerce in the Asia-Pacific region is being transformed by important factors, such as tec-hnical, regulatory, and political developments. Government initiatives and
private sector investments have helped improve econ.olillc performance. Cross-border online transactions have gained traction as weH, enabi·lng greater opportuni-ties for
international trade and commerce in the region. Cross-border e-commerce has so far been and will continue to be a major driver of global B2C trade growth.

MSMEs are necessary to the development of Southeast Asian economies- Micro, Small, and Medium Enterprises (MSMEs) are the building blocks for the economy
of every Asian country and this is especially true in the case of Southeas-t Asian countries; yet, they are often ignored by the·ir governments. Gross-border e-commerc-e
ca.n dr-ive MSME _growt-h by globalizing the operations of the enterpris-es and thereby inc-reasing the nu-mbf?r of prospective_customers.

Supportive e-commerce environment - The growth of cross-border e-commerce is directly related to the quality of an economy's domestic e-commerce operating
environment Well developed e-commerce economies are based on extensive and reliable information and communications technology (ICT) infrastructures, extensive
and !ow cost internet access, business-friendly regulations and legislation, the existence of e-commerce intermediary entities to lower barriers to entry for MSMEs, and
consumer confidence in purchasing goods and services online.

Domestic e-commerce and cross-border e-commerce support each other - An advanced domestic e-commerce environment provides crucial support for cross-
border trade, as it is the foundation on which cross-border e-commerce is built Similarly cross-border e-commerce stimulates the growth of domestic e-commerce and
improves it by transferring new technologies and business practices,

Cross-border e-commerce brings significant benefits to MSMEs - The global B2C cross-border e-commerce market is expected to reach USD 1 trillion by 2020,
Small and medium sized enterprises with high internet and technology usage grow twice as fast as enterprises that fail to take advantages of technology,

Report Southeast CrossMBorder E-Commerco Market Mordor l~telligence

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Platforms are the best enablers for domestic e-commerce enterprises to go cross-border- E-commerce platforms are essential for small and medium enterprises
that lack scale of operations, capacity, and reach to go cross-border. Platforms provide the tools, training, and support to help enterprises with limited capabilities to
engage in e-commerce. High switching costs and a limited selection of platforms are the main causes for the emergence of monopolistic players. Governments should
recognize that platforms are not passive tools and that there is a real danger that they will squeeze enterprises by charging unreasonable listing fees.

E-commerce platforms act as aggregators -They enable transparency on global prices, range of products, and availability, as well as enable smaller players to attain
cross-border reach at low cost and high efficiency. Marketplaces are allowing market access and market reach for sellers by aggregating consumers and providing
fulfillment, payment, marketing, and other transaction services. With their global reach and scope, e-commerce marketplaces, such as Alibaba, eBay, and Amazon, have
reduced the costs and manpower requirements for MSfVlEs to engage in cross-border e-cornmerce.

Platforms oare important in cross-border e-commerce ecosystem, lor they provide enterprises with end-to-end solutions, from onl·in<l pres€mce to poayments. The
economies of scale and scope that the largest platforms provide to not just toe j\/ISMEs, but also the major players, significanHy lower individual tmnsaction costs and
provide more consistent and reliable services. Global platforms also spur cross-border growth through translation and cu-stoms services. Consumers can purchase goods

and services through a multitude of gateways, from fully integrated solutrons such as Alibaba, to services such as product search engines. Social media platforms, such
as !nstagram, are quickly becoming important platforms for MSMEs, especially in emerging economies.

Governments should guide, advocate for, and protect enterprises as they engage with platforms. \Nith the huge pots:ntla! advantages that platforms offer-, governments
can engage with foreign players to find a way to integrate them into the local economy. The platforms should aim for knowledge sharing and should provide channels for
enterprises of all sizes, but specrfically the MSMEs have to learn from each other's e-commerce strategies.

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Cross-border e-commerce diversifies and mitigates risks - E-commerce firms on an average export to 30 to 40 different economies, compared to the 3 to 4
economies of the traditional exporters. This ten-fold increase rn the number of markets targeted by e-commerce MSMEs drffuses their business risk by decreasing
dependency on any one market.

Cross-border e-commerce creates posJt.ive externalities throughout the value chain - There are positive externalities throughout the value chain of cross-
border e-commerce firms. Consumers gain greater access to price information and more cqmpetitive markets. With regard to operations, the demands of cross-
border ecommerce push firms to upgrade their infrastructure and proced-ures, increasing efficiency and providing a new basis for future learning. Transfer of money is
improve-d by more sophisticated payment systems. Cross-border e-commerce also pushes improvements in logistics and supply ohain manage-ment, while a-
commerce can allow filllls to source their key inputs at lower cost.

With distances in the global value chain shrinking, more opportunities arise for cross-bordBr e-commerce-ready MSMEs. The global business environment has
opened up new opportunities for MSMEs to start cross-border business. Cloud services, such as the Amazon Web Services, have removed the need for capital
investment in data centers. 99Designs and Upwork have opened up professional design to small companies. Platforms, such as the App Store and Google Play,
have extended the reach of small developers. More types of businesses are establishing global operations to capitalize on this cross-border trend.

Southeast Asia Cross~ Border E~Commerce Market Mordor lntdHge' cc

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Digital connectivity and easy access ~ Investments from the private and public sectors have increased internet access to more than 90% of the population in the
ASEAN region. There are constraints in the bandwidth of rural coverage, but governments are improving and extending digital inclusion. Countries that have lesser
physical infrastructure constraints, such as Malaysia and Thailand, are benefitting from the e-commerce development. Thailand is expected to witness a surge in e-
commerce activities in the near future, due to factors enabling the overall e-commerce sector.

Financial environment -After the introduction of digital financial services across the region, digital payments account for roughly 3% of the consumer spending in
ASEAN China, which is leading in digital payments, has about 30% in comparison. Many countries in the region are already taking measures to develop the digital
financial environment to include businesses and individuals, most of whom are still in the process of adopting global standards and best practices.

Commerce and trade activities- Countries in the ASEAN region have made significant progress in implementing the ASEAN Free Trade Area. With the introduction of
the Common Effective Preferential Tariff (CEPT) scheme, tariff rates have d<ecreased from 13% in 1S93 to 02% in 2015. Non-tariff barriers, on the other hand, hav® risen
from around 1,600 in 2000 to roughly 6,000 in 2015. In the case of log<stics infrastructure, ASEAN countries have developed the Master Plan on ASEAN Connectivity
(MPAC). These initiatives remain crucial for digital integration, but their implementation is witnessing several challenges.

Business environment- Countries in the region are now more open to investments. Despite this, a few SMEs face barriers to start and expand businesses, due to
compi'icated processes, long wait times, regulelory loopholes, and a few pwhibitive costs. New polides are not considering the effect of administration costs and the time
burden on SMEs.

Southeast Asia CrossmBorder E~Commerce- Market MordorJ'r;te/l(genuJ

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ASEAN's B2C and B2B2C e-commerce sectors have been growing at around 25%, annually, for the past five years, reaching an estimated USD 10 billron in 2017.
Compared to that at the United States and Chrna, ASEAN's e-commerce sector is only beginning to launch. However, there is a significant room for growth. For example,
e-commerce represents only 2% of the tota·i AS'EAN retai'l sales, in contrast to the approximately 12% in the UnHed S-tates and 20°/,') in China.

The strong tide of macroeconomic demand in ASEAN will fuel this growth. More than 50% of ASEAN's population is under 30 years old, and ASEAN's real GOP per capita
has grown at 3.8% in the past five years, compared to the global average of 2.3%. Meanwhile, the proportron of internet users has increased 2.8 times from 2012 to 2017.

Commerce and trade: Member states have made significant progress toward realizing the ASEAN Free Trade Area. Through the Common Effective Preferential Tariff
(CEPT) sdheme, tariff mtes have decreased from 13% in 1993 to 0.2% in 2015. The oumher of non-tariff barriers, however, has risen from aroun~ 1 ,BOO in 2000 to
roughly 6,000 in 2015, which must be addressed. On logistics infrastructure, ASEAN member states have developed the Master Plan on ASEAN Connectivity (MPAC),
prior to the formation of the A SEAN Economic Community (AEC). These plans remain critical for digital integration, but their implementation has been challenging.

Business ecosystem: Member states have become more receptive to investments. However, with the exception of a few member states, SMEs still face barriers to start
and liquidate businesses, due to complicated processes, long wait times, regulatory uncertainties and, at times, prohibitive costs. New policies still do not consider the
administrative burden on SMEs.

Southeast Asia CrossMSorder E~Commerce

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B2C and B282C E-commerce Sales as a Percentage of Total Retail Sales, by Region, 2017
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Online Shoppers who Shop Domestically and Cross-border(%), Slngapore, 2018

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Online Shoppers who shop domestically and cross-border(%), Thailand. 2018

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75

70

60

so

4C•

"':(\

22
20

18
:::,

0
Shop cross border only Shop domestically and cross border Shop domestically only

Report Southeast Asia Cross~Border E~Commerce Market Mordor lntc:iigc,~::o

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4.3 ( 70)

Online Shoppers who Shop Domestically and Cross-border{%), Philippines, 2018

60 •

50
'_)()

45

:l()
'-·~

3U

20

0
Shop domestically only Shop domestically and cross border Shop cross border only

Report Southeast Cross~Border E~Commerce Market

"'"""'"'•'•;, '"" "'"'''"~'' "''" '"-'"· ms; """'"''"""'"~'a,-;,'""- "',"'""'"' 0 "'"'"''"' "'"""'""
 ( 72) ::

Business-to-business cross-border transactions are generally of a higher value than the business-to-consumer transactions. B2B orders generally are placed in bulk.

The various initiatives in the ASEAN and the Belt and Road Initiative (BRI), are responsible for the significant growth of cross-border, B2B digital trade. The
cooperation between Chinese enterprises, is a key factor in boosting 828 sales. The Philippines, Vietnam, Indonesia, Cambodia, and Thailand a\1 witnessed high
growth mtes in cross-border B2B exports with China, in 2017.

With people of ASEAN preferring foreign products, such as Chinese, Japanese, and Korean products, businesses in the region can order foreign products online, at a
wholesale rate, and sell them at retail stores across the region.

Cross-border e-commerce is transforming the way SMEs and online merchants are operating their businesses. Alibaba is one of the leading online 828 platforms, in
the region.

Thailand is one of the most important countries, in online B2B transactions. B2B transactions account for more than 50% of the country's total e-commerce
transactions. Indonesia also has huge growth potential in cross-border B2B sales. Some of the local B2B players in Indonesia include, Bhinneka Bisnis, Bizzy, and
Mbiz.

Based on our analysis of the B2B e-commerce market and it's dynamics, reporting by Chinese authorities, etc. -the size of the B2B GMV that is purchased via cross
border online mode- including enquiries via the Alibaba B2B platform, maJorly could be close to around 6 % of total global exports to ASEAN- bringing the total
gross merchandise value of B2B cross-border e-commerce enabled purchases by ASEAN countries to a value of around USD 80 billion for the year 2017.

The B2B enabled e-commerce market is expected to turn into a B2B e-commerce market going forward - due to innovations in technology and supply chain
management.

Due to both low base of actual B2B e-commerce transactions happening and high expected economic growth rate and industrial performance of ASEAN region- the
B2B e-commerce forecast growth rate is also expected to be around 30% over the forecast period till 2023.

Report Southeast Asia CrossMBorder E~Commerce Market Mordor !:-1tcdgencEJ

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5.2 B2C ( 73)

The business-to-consumer segment is becoming dominant in cross-border e-commerce sales, in Southeast Asia, as a result of the rapid digitization across the
region.

The primary drivers of B2C cross-border e-commerce include factors such as, the unavailability of the product domestically, and the affordable costs of products at
foreign retailers, etc.

However, the growing culture of shopping malls, and the presence of fewer credit card holders, restrain the growth of the B2C segment.

Due to the growing digital economy in the region, B2C cross-border e-commerce is highly competitive, with the entry of major foreign players, alongside dominating
local players.

Moreover, training courses on selling goods, globally, help small and med1um enterprises to enter the e-commerce business, and sell products directly to
consumers, throughout the world.

ln addition, exchange rates a!so remain a hurdle, for the growth of the 82C segment The elimination of i-ntermediaries with the use of technol-ogies, such as
blockchain, can simplify cross-border payments, as well as help in reducing costs.

Among the products bought through cross-border online sales, fashion and electronic appliances dominate the other categories. In addition, the return logistics are
key in enhancing cross-border sales.

Lazada IS one of the leading players, in B2C sales, across the reg1on.

Popular destinations for consumers include, China, the United States, Korea, and Japan.

Report Southeast Asia Cross~Border E~Commerce Market Mordor i'ltc!!igonce

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5.2 ( 74)

Southeast Asia is the emerging hotspot of the world, with a skyrocketing economy. As a result, the needs and wants of people are growing, across the region, in
recent years. With a growing disposable income, people are becoming more willing to spend, and are starting to prefer luxury items.

The penetration of the internet, is helping the micro and smal·l enterprises, or individuals, to sell their items domestically, as well as in other countries, However, the
shipping process becomes the most difficult part, while selling from person to person, throu~h social media.

Online marketplaces, such as Lazada, eBay, Shopee, and ezbuy, are popular marketplaces across the region, that enable C2C cross-border e-commerce.

The rising demand has led to the development of innovative solutions, such as platforms that connect travelers and buyers, to support C2C cross-border e-
commerce. In general, 80% of shoppers rely on friends or family, who travel overseas, to purchase products that might be cheaper in, or exclusive to, in a particular
country.

Airfrov, of Singapore, and Jetspree, of Malaysia, are the two most popular startups in this area. The shoppers need to post the productothey are willing to buy, and
put a request on the webpage, which would be accepted by the registered traveller, based on the amount the shopper is willing to pay.

Some of the popular items that are requested in Airfrov, include food items from Japan, limited edition Starbucks tumblers, available only in retail outlets, and the
Tokyo Banana, a popular Japanese pastry, with a short shelf life.

Report Southeast Asia Cross~Border E-Commerce Market Mordor intellipC!'~0e

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 Cross··border B2C E-commerce Revenue
in IJI!IJUll, 2017·2023

38.101

29.455

22.104

-~
~;

N
#; 12.248
9.363

2017 2018 2019 2020 2021 2022 2023

Note: The above chart excludes value of the market resulting from sales of eServices such as travel and tourism,
ticketing, media content services. etc. The size of that segment is provided separately in section 6.6 of the report.

Report Southeast Asia Cross-Border E~Commerce Market Mordor lr-,telligerce

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 ( 77

Fashion and beauty products, are the most preferred by the consumers, when shopping across borders, as well as domestically. The cross-border e-commerce
market for apparel, footwear, and personal care, is valued at USD 2.54 billion, in 2017, and is expected to reach USD 12.65 billion, by 2023 registering a CAGR of
30.53%.

The presence of large populations, especially with a large share of young individuals, the demand for fashion and beauty accessories is driving the cross-border
sales of these items.

According to an industrial survey, in 2017, it was observed that fashion, such as clothing, footwear, and accessories, was the top category for cross-border
shopping, with 68%of Filipino cross-border online shoppers spending on these items. Beauty products accounted for the third most shopped category, with around
56% consumers opting for these.

In Singapore, it was estimated that 65% of people h·ave bough! clothing., ~hoes, and accessories onlin®, where as this stands a! 49%, on a global level. Eeven
though the preval.ence of shopping malls IS gmw1ng in the reg.ion, people are preferring to buy luxury i!®ms ana branded products irom abroad, as they come a!
lower prices, when compared to local stores.

With the online sales of fashion and beauty growing, new technologies, such as augmented reality (AR) and virtual reality (VR), which allow the customers to test
the products on themselves, before ordering them. This helps to reduce the risk of product returns, which is especially difficult during cross-border shopping.

Beauty products and fashion accessories are the third highest cross~bbrder e-commerce exports of China, to Southeast Asia.

With an increasing population and its grmNing awareness, consumer spending on the persona! hea!th and well-being is expected to rise, driving the cross-border
sales of cosmetics, pharmaceuticals, consumer health, and medical devices.

Report Southeast Asia Cross~ Border E~Cornmerce Marke-t Mordor lnto!iiaen8c

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 ( 78)

f>eri:1o;;;:,i -;,<:

12.653

2017 2018 2019 2020 2021 2022 2023

Year

Report Southeast Asia Cross~Border E~Commerce Market Mordor l·;to :iuence

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 ( 79)

Consumer electronics, such as mobile phones, tablets, and computers, remain the next
most preferred category, during cross-border purchases, after fashion and beauty.
Sc>ulheasl Asia Cross-border E-commerce Markel: Revenue
The cross border a-commerce sales of 3c and other physical electronic appliances is
rvr11nn 3c And Eieclronic Appliances.
valued at USD 1.94 billion in 2017and is expected to reach USD 10.29 billion by 2.023
20'!
registering a growth rate of 31.97%.

According to some industrial experts. the cross-border e-commerce trade between China
and ASEAN is expected to rise by 50%. in 2018, boosted by trade facilitation. 10.291

Computer, communications, and consumer electronics products (3C products) account

7.982
fN the major share of ihe cmss-border e-commerc® ®Xport products. from China to lne
Southeast Asia region.
0
6.010
~'}

It was estimated that 57% of the cross-border online shoppers in the Philippines,
shopped for consumer electronics, in 2017.
3.352
As people are becoming more willing to spend. they are looking at new technologies and 2.571
gadgets, for purchasing.

Taiwan is one of the popular destinations for cross-border shopping of electronics and
appliances, including from China. PChome and TVDmomo are two popular Taiwan- 2017 2018 2019 2020 2021 2022 2023
based marketplaces for cross-border shopping, in Thailand.
Year---~

Report Southeast Asia CrosswBorder E~Commerce Market Mordorl,.te' igerce

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6.3 FOOD <80)
The main food products in cross-border online shopping, include agricultural products or
raw materials, because fresh food and beverages are fragile, and have a shorter shelf
life. i.n
USD mil!iA•·
Among the cross-border e-commerce imports of China, from Southeast As-ia, the main
imports include agricultural and high-quality specialty products, such as health products,
latex pillows, milk powder, convenience foods, brewed drinks, snacks, and rice.
4.191

The Dongxing China-Vietnam Cross-Border Economic Co-operation Zone, is p~ised to

develop cross-border e--commerce through the integrated development of border trade,
l
especially with respect to agricultural by-products.
!
The demand for special products, such as plant-based beverages, dairy-based food, and
~
beverages for protein, as well as other for products, such as oat based-cereals and
snacks, is growing in the region.
8
0
c
In April 2018, the Chinese e-commerce giant, Alibaba, collaborated with the Thailand 5
c
rr
government, to increase cross-border trade, and support local businesses and farmers.
This included an outline to attract Thai farmers and fruit growers, to tap the Chinese
market, through Alibaba's Tmall, China's largest online business-to-consumer platform.

2017 2018 2019 2020 2021 2022 2023

The Thai Ministry of Commerce launched a fiagship store, to sell Thai rice on Alibaba's
online marketplace, Tmall. 80,000 pieces of durians, weighing 200 tons, were sold in one Year ---&-

minute.
Report Southeast Asla Cross~Border E~Commerce Market Mordor intelligence
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6.4 TI"\V~ GAMES, BOOKS, AND ( 81 )

The cross-border e-commerce market for toys and games and other hobby products, is
valued at USD 0.99 billion in 2017 and is expected to reach USD 6 billion by 2023.
Southeast Cross~border E-commerce Revenue in
The demographics of the region, is one of the factors that drives the demand for toys and
t5ooks, and
games. As the proportion of the population that are children grows, the demand for toys
2017
rises.

With high internet penetration, the awareness of gaming increases, and this drives the
6.047
youth to pursue new products, from the foreign online stores.
~

According to eBay, one of the top cross-border sites in Smgapore, the toys and games
4.58-2
"xporls of the w"bsite to the UnW®d Slat®s, from Singapore, witnessed a gmwth of 1'3%,
in 2017, when compared to 2016.
C1 3.370
!t was also found that toys and games are among the most searched Google k€ywords
in Indonesia, with a groVc<!h of almost 35%, in recent years. 2.459
~.:

0) U94
The main factor that restrains the online sales of toys and games, is the lack of trust cc

among the shoppers. However, the g.rowing prevalence of e-commerce usage, and the 0.991

improving measures to avoid fraud, are likely to lead to developed trust and a boost to
sales. in the future.
2017 2018 2019 2020 2021 2022 2023
Apart from high-tech, electronic toys, educational toys that enhance the imagination and
Year---->-
creativity of children, are expected to become popular in the future.

Report Southeast Asia Cross~Border E-Commerce Market Mordor lntelligenco

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 ( 82

The other products segment includes home improvement, home

furnishings. garden equipment, and pet care, etc. The cross-border e-
commerce sales of these products reached USD 0.85 billion, in 2017, and is
Soutl'i~:::~:Ti: sv·:sio ,_.- oss~-h<" r:det &~:~eoYnBf0::'z>::t [J'l8.t"io::~t;?'.: b',evsH:.U< t'J
projected to reach USD 4.9 billion, in 2023. b/ii!O' '· Oih-f>l<'§ i;c.J,rtm~--;:-~,·,;,

The increasing consumer base, result from growing disposable income, is

leading to an increase in the sales of the horne furnishings and related
products, from foreign countries.
4.919

Rapid urbanization is also leading to a change in the lifestyles of people, :{>

and the development of residential properties.

These developments of new properties are leading to rise in demand for

homeware and furniture, kitchenware, small home appliances, home decors
such as ornaments, vases, clay articles, etc.

This change 1n life styles increases spending on small home appliances,

such as air purifiers, vacuum cleaners, coffee machines, etc.

With a lot of small and medium sized enterprises spread across the region,
the local-made home decor products, also have growth potential within the
2017 2018 2019 2020 2021 2022 2023
cross-border online marketplaces.
Year·----->-

Report Southeast Asia Cro-ss~Border E~Commcrce Market Mordor lrtoiiigencs

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6.6 TRAVEL AND OURISM. AND OTHER DIGITAL <83)
The travel is one of major categories of cross-border sales in the region, with the presence of many holiday destinations, such as Singapore, Malaysia, and
Thailand, boosting inbound travel.

Moreover, the growing economies driving the disposable income of the people, and the growing middle-class population in the region, are leading to an increase in
leisure spending, in turn driving outbound tourism. As of 2017, the travel and tourism sector's direct contribution to the GDP in Southeast Asia stood at 4.9%,
translating to USD 135.8 billion.

The travel Industry is the largest e-commerce sector, in both Singapore and Malaysia. It was estimated that more than half of all online transactions consist of travel-
related products and services.

Singapore is a trading hub and a popular holiday destination. Therefore, hotel bookings and airline tickets bought from Singapore Airlines, are responsible for most
of the export of e-commerce.

Malaysia is home to the fargest budget airline in the region; AirAsia. AirAsia is believed to be what exposed Malaysians toe-commerce. In 2017, 59 mi!!ion travelers
arrived in Kuala Lumpur airports, whereas Singapon~ saw 62.2 million travelers. fVla!aysi·a, with its pristine islands, is also a very popular ho!'iday destination,
resulting in cross-border hotel bookings.

According to industrial estimates, more than half of Singaporeans who bought travel tickets purchased them online, when compared to 40%, globally.

Media products is also one of the popular categories in the on[ine sales. VVith the internet becoming more accessible to people, they prefer to watch online content.
As a result, they buy products re!ated to electronic media and entertainment, boosting cross-border sales.

Report Southeast Asia Cross~ Border E~Commerce Market Mordor !nteiligcmcc

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 ( 84)

Contribution USD and Tourism

ross.• b·or·dr>r E~cnrnrn!2~Yr:i? M.:;v·Kr-t· "'''·"'"""
! . . .•
J ra<J\S'i .r,r.: ;,Ii'!,i;·
160

40.360

r•o
'L"

"
~
~1
60

6.251

20
2017 2018 2019 2020 2021 2022 2023

Year---_,.
0
2012 2013 2014 2015 2016 2017
Year
Southeast Asia Cross~Border E~Commerce Market Mordor ir;;::c,ligcncr;;
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 ( 85)

Economic of SEA Travel Tourism - Real Prices- 2017

Visitor exports 94.4 105.4 108.2 117.6 126.8 135.6 7.51%

Domestic expenditure 77.1 82 91.9 103 112.7 119.3 9.12%

Internal tourism consumption 171.4 187.3 200.1 220.6 239.5 254.9 8.26%
Purchases by tourism providers,
-77.4 -85.1 -92.3 -102.6 -112.2 -119 8.98%
including imported goods
Direct contributiOn of
' -:-< ;--_·:'.~ :·.- ,'"; ': '·----'- 94 • '10'2c2"· i35.S . 7";64%·
Travel & Tourism to GOP

• Domes.tic supply chain 62.5 62 9 75.4 84.9 93 99 9".64%

___ ,-,-_,

C'~pittd._ i~-Ves:tinent 39.9 41.2 45:8 46.7 48.8

Government collective spending ii .3 12.4 12.9 14 14.6 15 5.83%

{_mpOrte_O ·goOdsfrmrLindlr~ct
'~- ____.:2_-t -24:3 -:24 . ~ : ..,25.8. --2E3.1.
spe~ctiri~
Induced 38.9 42.6 45.7 51.4 55.6 58.3 8.43°/~

Total. contribution of
225.7 244.9 260. 7 311,1 329.5 .7:8,60fo
Travel &Tourism to GOP

Expenditure on outbound travel 52.8 57.8 62.2 63.5 66.2 67.1 4.91%
Report Southeast Asia Cross~Border E~Commerce Market
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6.6 ( 86)

Indicators ol SEA Travel & Tourism Industry 7

Total contribution to GDP 329.5

Direct c.onfrihuti.o~...to.employment ,14457

Total contribUtion to ·employment 36309

•
Visitor ')>'J:(!Orl:~>:•i:)(/iip.•.• , .• ; :.;. ··•·:\/ d:2::· ;;•i.:;., ; ...-\i{.~1 )?,f··........ ·••·.

Domestic spending 119.3

Leisure spending 184.9

Business spending 70

Capital investment 48.8

Report Southeast Asia Cross~ Border E~Commerce Market Morden lr~to::ige,-;cc

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ID

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 7. ( 88)

Southeast Asia Cross-Border E·

Southeast A.sla Cross~Rorder E-<~nrr«ne "'lvrl«>t: R:evenue in billion.
)

Singapore. 0.82 0.94 ... 1:14 1.32 1.69 2J3 .. 2.76 3:59 4.61. 5.76 27.82%

Thalland 1.03 1.12 1:27 1.50 1.95 2.49 3.26 4.26 5.54 6.98 29.04%

;:·<·; ,_., ...

M~l~f~ia• . '"6.59 0.6.9. 0.85 1 1.79
',/:·>
2A4 4.47 5.86 34.07% 21%

Vietnam 0.33 0.42 0.53 0.70 0.95 1.27 1.73 2.34 3.14 4.06 33.72%

Indonesia 0.75 0.97 1.33 1.73 2.36 3.16 4.:34 5.97 8.14 10.77 35.47%

Philippines 0.50 0.57 0.69 0.79 1.06 1.41 1.93 2.63 3.56 4.68 34.53%
"'Singapore Thailand ""Malaysia

., Vietnam ., Indonesia Philippines

Report Southeast Asia Cross-Border E-Commerce Market MordorJ·-~eiiige ~::::e

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7.1 ( 89)

Singapore is the dominant player, among the ASEAN countries, in cross-border e-

commerce, with almost 50% of the online transactions that take place, corresponding to
Southeast Asia Cross~border E~commerce Market: Revenue in
transnational transactions. This is more than cross-border online sales in countries like
USD billion. Sinaaoore. 2017 "2023
Japan, South Korea, China, etc.

Language is one of the significant drivers of the cross-border e-commerce trade, in

Singapore. The usage of English as a business language helps foreign retailers atlract
Singaporean customers, and makes it easy for them to do their businesses. 5.76

The advanced ICT infrastructure of the country and government support for digitalization
also help in the growth of the cross-border e-commerce market, in the country. With a
current population of around 5. 7 million, more than 80% of the population has access to 9
3.59

~"
the internet, and this number is expected to reach 90%, by 2022.
~
2.76
The e-cornmerce market in Singapore generated a revenue of around USD 3.5 billion, in
2017, and this is expected to cross USD 5 billion, during the forecast period. With more ,
j_ 1.69
than 60% of internet users in the country being digital buyers, the average amount spent 1.32

per capita digit;al buyer stands at almost USD 1,861, in 2017.

The country also has a robust logistics infrastructure that supports the growth of cross
2017 2018 2019 2020 2021 2022 2023
border e-commerce. According to the World Bank's Logistics Performance Index 2018,
Singapore ranked seventh, across the world, and first, among the Southeast Asian Year----,..

nations.

Report Southeast Asia Cross~Border E~Commerce Market Mordor tnto!iigonce

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,,t " ' " ' " " "

Goods valued at less than SGD 400, are exempted from Goods and Service Tax
(GST), and import duties, which is a major advantage for Singaporean
consumers shopping abroad, further propelling the market.
The country's advanced payment infrastructure also supplements cross--border
e-commerce. Credit cards and PayPal are the most widely used payment
methods for cross-border online purchases.
Despite the flourishing mall culture in the country, there is a huge demand for
cross-border on:line purc-hases. Gon;wmer electronics @nd appliances, which ar'G
primarily sourced from the United States, or China, and clothing and fashion, are
the two largest segments.
The majority of the cross-border online sales in the country takes place through
desktop/computer, owing, in part, to better product comparison on a larger
screen, even though mobile shopping is on the rise.
The micro, small, and medium enterprises (MSMEs) of Singapore, possess the
motivation, skills, and capability to adopt cross-border e-commerce, along with
the financing options for those who want to go online. They have developed
relationships across the region, to look internationally for growth.
Report Southeast Asia
"="'~'""""" ,..,,,.,.c,,.,, """' w.o~ m
( 90
Ezbuy and eBay are the two most significant cross-border e-commerce
providers in Singapore. Ezbuy is Singapore's first global shopping platform,
connecting customers with products from countries such as Korea, Taiwan, and
the United States.
Regarding the regulations for the import of products, items are defined as
import prohibited items and managed items. For the managed items, import
licenses need to be obtained from the competent authorities.
For instance, drugs are ma~ag'ed under the jurisd'1C'tion of the Health Science
Agency, and toys are partly managed items. If a toy transceiver has information
communication agency, such as a toy pistol it falls under the jurisdiction of the
Ministry of Home Affairs.
Cross~Border E~Commerce Market
S2"' "''''-'"-'-' "'"~'a>"."'"~ ""''""' '" ""'"'"''" "''""'~
 ( 91

The e-commerce market in Singapore is highly competitive. In July 2017, the US giant, Amazon, entered the market The Chinese giant, Alibaba, entered the
market in 2016, with the acquisition of Lazada.

Additionally, Amazon and Sing Post have collaborated to facilitate the delivery of overseas purchases, within three days, which is equal to the delivery time of a
domestic order in Indonesia. Alibaba also acquired a stake in Sing Post, and is its second largest shareholder.

The differentiation from the leading company, identity, and price competitiveness, are essential. when entering the Singaporean e-commerce market. There are
some Japanese companies which entered the market, but ended up closing their businesses.

v' Rakuten lchiba, which entered the Singapore e-commerce market in January 2014, closed at the end of February 2016.

/ JRUNWAY, a complex type Japanese brand shop, operated by AWSG PTE LTD, closed its real store in September 2016, and subsequently closed its online
store

/ BLUETABLE Co., Ltd, which launched an e~commerce specialized website for japanese food sales, in November 2016, announced withdrawal, in August
2017.

Singapore ranks 18th, and Malaysia ranks 38'", in the world, according to the Business-to-Consumer E-Commerce Index 2017, compiled by the United Nations
Conference on Trade and Development, which mea-sures internet penetration and delivery reliability.

Southeast Asia Cross~Border EMCommerce Market Mordor inte!!igence

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7.2 ( 92)

The cross-border e-commerce market of Thailand was valued at USD 1.5 billion, in 2017,
Southeast Cross-border E-commerce Market: Revenue in
and is expected to register a CAGR of 29.04%, to reach USD 6.98 billion by 2023.
USD biW0n, Th0",li:md 7
·?D7'.:.

Thailand is the second largest economy in Southeast Asia, wi_th _a GPO of USD 406.8
billion, in 2016, after Indonesia. The a-commerce market of the country has witnessed 6.98

significant growth over the recent years, with huge potentiaL

5.54
As of February 2017, the number of online shoppers in Thailan,d increased to -8 million,
2 million of whom buy goods from foreign websites. The e<3nsuming power of the
individuals is high in the country, with a quarter of the population being upper middle
0)
:-.7
class, and over one third being middle class. 3.26

~
Internet penetration is one of the driving factors of online sales. The "Thailand 4.0" '
1.95
government policy, which Improves the broadband network 1n all the villages across the 1.50
country, is connecting more people to online marketplaces, and boosting the e-

commerce market further.

One of the challenges in importing products to Thailand, is the high cost of tariffs, leading 2017 2018 2019 2020 2021 2022 2023

to rise in the overall cost of the product Year----->

The average online shopping expenditure, per person, for the ecommerce market, stood With more than 80% of population online, the average time spent

at THB 41,215, whereas that of the cross-border shopping stood at THB 30,893. online by Thais is more than that any other Southeast Asian

Fashion, digital entertainment, and electronic goods, are the most popular categories, country, standing at almost 9.38 hours a day.

when purchasing cross-border.

Report Southeast As! a Cross-Border E~Commerce
""""'"'"'' ,,,......,..."'"""""' ""'· J!.'" ""'~'"-"' "'"~' ,..,,., ""''· ""'""'"'"" '""''''""" ''"~'""'
 ( 93)

The government of Thailand is taking necessary measures to boost local manufacturers, and shore up domestic e-commerce sales against foreign cross-border
online companies. These measures may hinder the growth of the market, to some extent.

In this regard, country proposed a new e-commerce tax. In January 2018, the Thai Revenue Department (TRD) issued second draft of the proposed tax legislative
amendments, that will impact foreign e-commerce operators, in the Thailand market.

One of the prime focusses of the TRD, is inclusion of non-VAT registered persons in the scope of VAT. Some of the key highlights of the proposed draft include:

./A foreign company that provides services through electronic media to a non-VAT registered person, must register, and will be subjected to VAT in Thailand, if
its annual VAT-able income exceeds THB 1.8 million, and provided such services are consumed within Thailand. The registration must be done within 30
days from the date 1ts VAT-able income exceeds the threshold .

./A non-VAT. registered person who pays a service fee to a foreign company operati~g its business through electronic media, is not required to administer VAT.,

by way of self-assessment.

./A foreign business operator registered for VAT in Thailand, should not collect VAT from its customers, in Thailand, and remit the VAT payable on service fees
received from non-VAT registered persons, to the TRD, and subm1t VAT returns, through the TRD's website.

./ No tax invoice is required to be issued by the foreign business operator reg.istered for VAT, in Thailand. r
.:l;;./
;-;:~ [:;:~.; ;, ... ,',\'
~~~~

June 2018: The Ministry of Commerce announced the expansion of government's Thaitrade.com website, from its status as a cross-border platform for exporters

running small and medium-sized enterprises (SMEs), to become the national online business gateway, with the full features of business-to-business (B2B),
business-to-consumer (B2C), and business-to-business-consumer (B2B2C) transactions.

Report Southeast Asia Cross~Border E-Commerce Market

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 ( 94)

Apart from this, the TRD defined a "digital platform" as an electronic channel that facilitates the business operator's provision of services to its customers, such as
websites, applications and online market places.

The digital platform will be exempted from VAT registration, if the following conditions are met:

-~' A document is issued to the Thai customer, confirming that services are provided by a foreign operator, and not the digital platform owner;

./ The foreign operator and the digital platform owner agree, in a written and signed agreement that the foreign operator, as opposed to the digital platform
owner, will register and administer Thai VAT;

-/ The digital platform owner does not have the power to collect payments from customers, without authorization from the foreign operator;

./ The digital platform owner does not have the power to deliver service to custome.rs, without authorization from the foreign operator; and

.f The digital platform owner does not determine the terms and conditions of the provision of services

In May 2018, DHL and Thailand Post entered in to a partnership to support growing cross-border e-commerce, and to
enable the Thai merchants to invest in cross-border trade more confidently, as a part of Thailand 4.0 vision.

lrJ5tJlfltliJ1B This collaboration combines the global logistics services of DHL, with Thailand Post's widespread and robust network,
TffAIL.AND POST countrywide. The customers of Thailand Post, using Courier Post, will have delivery within two to four days, with access
to over 220 countries and territories, customs clearance expertise at destination, and the On Demand Delivery (ODD)
solution, powered by DHL Express.

Report Southeast Asla Cross~Border E~Commerce Market Mordor 1r,te.:igcnco

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 ( 95)

With the highest network penetration in Southeast Asia, after Singapore, and relatively
good infrastructure, ]cross-border e-commerce is prevalent in Malaysia, and is growing
Soutl1mudAsia E-commerce Market: Revenue in
rapidly. According to some estimates, 40% of the e-commerce transactions in Malaysia
lJSD 2017-2023
are cross-border.

The consumption is increasing in the country, and the per capita GOP of USD 9,503 in
Malaysia, is higher than that of China, which is CNY 54,000, as of 2016.

The country rs strengthening bilateral relationship with China, boosting cross-border 5.856

online sales, through various initiatives. China is Malaysia largest trading partner, with
more than 25% share.

Regarding cross-border purchas&·S from Japan, pmducls related Ia health and "'"'uty
are the most popular. 11street is one of the marketplaces that deal-s with Japar1ese £
gooQs, but in a small number.
2.435

Rising income levels, and government support, are expected to boost the share of online 1.791
sales in the total retail to 5%, by 2020, from 0.5%, in 2014. 1.352

Singapore, Japan, the United States, and South Korea, are the most popular oversea
destinations of on[ine shopping in Malaysia, while daily supplies, and fashion and
2017 2018 2019 2020 2021 2022 2023
accessories, are the two most popular categories.
Year-----¥>

Report Southeast Asia Cross~Border E~Commerce Market Mordor i'ltoiHge.lce

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 ( 96)

As of February 2018, almost 58,824 businesses are registered with the Companies Commission of Malaysia (SSM). Also, the digital economy accounted for 18.2%
of the country's GDP, in 2016, according to the Department of Statistics Malaysia (DOSM).

The Malaysian MSMEs are equipped with the requisite technical skills, and are capable of engaging in cross-border e-commerce, while also enjoying a strong
government and private financing environment

Out of every ten businesses, nine of them are SMEs, and 28% of them have online presence. Among SMEs, 15% of them use their online presence for export
purposes. The government of Malaysia is undertaking many initiatives to boost the SMEs in the count0; especially, with China.
"
A Digital Free Trade Zone (DFTZ), which is the first of its type in the world, was launched 1n March 2017, between China and Malaysia, as a part of the Belt and
Road Initiative (SRI). The core element of the scheme is an electronic world trade platform (eWTP), designed to mak" cross-r.,gion shipments more affordab.le .for
Malaysian SMEs.

A total of 1998 companies are listed DFTZ program, of which 1,378 are eTRADE participants. The government expects the contribution of the SMEs to increase it to
23%, by 2020, from its current 18.6%. The SMEs account for almost 98.5% of the Malaysian businesses.

Some of the trade facilitation measures under the DFTZ include the reduction of cargo clearance time from six to three hours in KLIA Air-Cargo Terminal 1 (KACT1 ),
and making the documentation process simplified.

The platform is also open to SMEs of China, and Malaysian firms are expected to face challenges with high competition from Chinese players. There are also
concerns that the platform will be dominated by Aliababa, a private sector partner in this project. However, the platform is open to all, and there are other players who
are creating their own platforms.

The Malaysia Digital Economy Corporation (MDEC) announced that the government is working with other platforms, such as Amazon, eBay, Lazada, Trade India,
and BuyMalaysia, under the DFTZ.
Report Southeast Asla Cros:siliBorder E~Commerce Market Mordor inre: :ige:~~s
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 ( 97)

Besides DFTZ, Malaysia-China Cross Border e-Commerce Sharing Platform (MCESP), is another initiative that links together regional e-commerce players, to

enable local merchants to sell globally.

The MCESP is a collaboration among ICBC (M) Berhad, Linghang International (M) Sdn Bhd, SF Global Express (M) Sdn Bhd, Homedeal.my, and eBusiness

Association Malaysia.

There are rnany local products from Malaysia that are preferred by Chinese customers, boosting cross-border e-commerce. This assists Malaysian SMEs in entering
the Chinese market.

SF Express is expected to supplement the logistics for the merchants selling to China, with its large footprint across the country.

Cross-border e-commerce is the main driver of the growth in the air freight market. SF airlines does not operate any freighler planes between China and Kuala
Lumpur, and it is expected that the company may cooperate with Wuhan-based Uni-top Airlines, which operates scheduled freighter flights between SF's main hub,
in Shenzhen, and Kuala Lumpur.

The demand for mobility services and online travel bookings is a!-so high in thee-commerce market of Malaysia, and, by 2022, furniture and appl-iances is expected
to become the most popular category, followed by electronics and media.
J-~~- -~------ ----~~--~

Commerce.Asia entered into a collaboration with MDEC, under the Digital Free Trade Zone (DFTZ) B2C Export programme, that aims
to promote and drive exports by Malaysian SMEs outside of Malaysia.

Thailand was the first country targeted by the company. Through this partnership Commerce.Asia will on board Malaysian merchants

~ to sell products to Thai consumers. )

Report Southeast Asia Cross~ Border E~Commerce Market

Oo·~l>·'"'' by '"'"'b'"'""""' ~=' ''"'·''·"'·''" "'"''"'' "~'-" "''· ""''- """-"'"' '"""'""" "'""''"'"-
7.4 un:Tw.J ( 98 >
Vietnam is one of the fastest growing economies of Southeast Asia. E-commerce in the
country is growing rapidly, with annual grovvth rates of greater than 30%, which is almost -::_-:1 ":;::;:-:~---~ <!.<;-;; :_V ,-,. r:-s<· ,:{-;;::e;:;;o, ~L'<:=
VfH(;J;:'\-i'{', :;:{:!--, ?~?t:"J
2.5 times higher than Japan.

The e-commerce boom aided the grovv'th of the cross-border e-commerce in the country,
and it was estimated that -33% of consumers bought products from abroad. The
increasing consumption demand of Vietnamese people, and SMEs' efforts to reach foreign 4.06
markets, are fostering the cro>s~border e-commeroe market in the country.

The cou-ntry also has -governme-nt po:J.iciffis for promoting Oom-estic, as we!:! as cross-border,

e-commerce in the country, such as The third E-Commerce Development Master Plan
(2016-2020), Vietnam National E-commerce Development Program (2014- 2020).

The Department of E-commerce and Digital Economy has also launched an e-commerce
(~
portal to support Vietnamese exporters. The B2C sales account for -5% of the total retail
sales of the country, and it was estimated that the B2C retail sales will reach USD 10 ;;
;:___

billion, by 2020.

The MSMEs in Vietnam possess basic technical skills and strong motivation to engage in
e-commerce, with an extensive use of social media to sell things online. The availability of
2017 2018 2019 2020 2021 2022 2023
financing options is a challenge, and there is a need to build basic business intelligence
Ye-3;~~~~_,.
and capabilities to run companies, through training and building entrepreneur networks.

Report Southeast Asia Cross~Border E~Commerce Market Mordor !r1to!!igenco

0=.""""'" o, ,,..._,.,'-''"""' ''""' "~o",<n.Ol o< 1o1>-'o--N '-"' ·'"" "" ""- ""''''.,·~~d Dl""'""" h>•oi,d
 According to a survey by the Department of E-commerce and Digital Economy, of 800 export businesses, it was found that 70% of them are SMEs, and the
remaining are big enterprises.

It was also found that 11% of businesses have joined foreign e-commerce platforms.

A lot of foreign goods are sold at the local e-commerce site, but all are imported beforehand by Vietnamese companies. Customs clearance remains one of the
primary challenges for cross-border e-commerce sales in Vietnam.

For instance, cosmetic customs procedures involves obtaining a cosmetic disclosure statement for each product, and a conformity certification for children is
required, before importing toys and strollers.

Beauty and personal care products have a huge demand in Vietnam, with the total market for these products standing at USD 1.7 billion, in 2016. The cosmetics
rndustry of the country is comparatively weak, and almost 90% of the products are imported.

The products related to technology and electronic equipment are brought by Vietname-se online shoppers from fore-ign websites, due to [ack of trust in the local e-
commerce platforms.

Vietnamese shoppers purchase goods mostly from the United States, Japan, Korea, and Germany, and they prefer trusted e-commerce sites, such as Rakuten and
Amazon. In 2016, almost 800 million items were brought by the Vietnamese online shoppers, from Amazon.

In recent years, Vietnam and Japan have been increasing bilateral cooperation in e-comrnerce. The Japanese Ministry of Economy, Trade, and Industry showed

inclination towards building cross-border platforms, through cooperation w!th Vietnamese partners.

In 2017, Vietnam proposed an initiative, within the Asia-Pacific Economic Cooperation (APEC), to develop a framework that facilitates e-commerce businesses. One
of the five pillars of the initiative includes dealing with the issues in cross-border e-commerce, and promoting paperless trade,

Report Southeast Asia Cross~Border E~Commerce Market

""""l"'""''''..-·"'b'-"''""'h"'"'·'·-•f1.>2.·1l01>.1M<""'"""·"'"'·"""c""""'o"tt'''•''''"""'""·
7.4 ( 100)

~
'
Almost 73% of the population in the Southeast Asia is unbanked and so. Cash On Delivery (COD) is the most preferred \
'
payment method for online purchases. I

Sep 2018: DHL eComrnerce launched the Cross Border Cash-an-Delivery (COD) service for consumers in Malaysia,
Thailand, and Vietnam.

The s-ervice is specifica-lly for sellers in China and Austrajja to knock on cross-border opportunities in these countries.
Additionally, the company offers other features, such as parae! pick-up service, easy IT integration of the seller's inventory
into the DHL s-hipping process, end-to-end tracking, dynamic routing and distribution, returns managc;ment, etc.

The company also provides the trackrng status of COD, and the collected cash will be remitted to a local bank account at
destination (Malaysia, Thailand. or Vietnam), or in the billing country (China or Australia), based on the local destination
currency, every fortnrght

Report Southeast Asia Cross-Border E-Commerce Market Mordor hte::tger;co

O=''''j'' b> ''"''"'''' """' ~ool fW,>;,m.,; >l 20!0.1...., {lo: ;<,?, B<f, '''"- ""'"'.'""' """"'''" " " ' " " '
 ( 101)

The fourth largest populated country in the world with a population of more than 260
million, Indonesia is a key area of focus for the cross-border e-commerce market.
Cross-Border E-commerce Market: USD
Most of the brands are looking at cross-border e-commerce operating model instead of 20'1
setting a local business, owing to the hassle involved in importing and customs clearance
which makes it costly, time consuming, and effort intensive.

The customs clearance is the first obstacle for the cross-border e-commerce operations
10.767
in Indonesia, due to the3 elusive customs regulations.

The country witnessed an huge inflow of b2c cross-border e-commerce companies due
8,136
lo the chanQ<> in customs import re~ulations, in Aprfl 2017, b®far® which wholesal®
::::
shipping w1th unclear Import duti®s and taxes and red or green importation period models
5.968
were prevalent.
::J

The government introductB-d clear import regulations associated with B2C ecommerce 4.341

after identification of the loopholes. BPOM (Indonesia's food and drug supervisory 3.159

agency) looks over food, health, and beauty products, and the relevant regulations.
i.73LJ

Some products, such as clothing, footwear, and electronic products can not obtain import
clearance in Indonesia, unless the exporting country s1de undergoes pre-shipment
2017 2018 2019 2020 2021 2022 2023
inspection_ Some appliances (washing machines, refrigerators, air conditioners, irons,
Year-~~~~~
cables, fans etc.) and toys, etc. are obliged to obtain Indonesian national standard (SNI).

Report Southeast Asia Cross-Border E~Commerce Market Mordor lnto!Hoence

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 ( 102)

According to the current government policy, which aims at promoting consumerism, the goods below USD 100 will be subjected to minimal formal entry, which
used to be USD 50. On an average, import duty and tax is levied on products above this value which consists of 10% VAT, between 10 to 20% income tax, and
7.5% 1m port duties.

There exists some concerns among the Indonesians, regarding the payment safety and quai·ity, over the online sales of goods. As of 2017, the total e-commerce
sales accounted for only 3.1% of the total retail sales, which implies the huge space fore-commerce penetration in the country.

In July 2017, the Indonesia's Central Bank announced new regulatory measures on the National Payment Gateway (NPG) to provide smooth, and secure
transactions. However_, these measures presents som-e challenges regardi-ng the c-ross-border a-commerce transadions.

The NPG requirements will prohib.it internalti.onal eh~c-tronic payment oompfl!mes from proc-essing domestic transactions, -unless c-ompani@s ei-ther establ.ish a local
switching institution with 80% Indonesian ownership or form a partnership with a domestic switching company.

On a whole, all global e-commerce transactions w"rll be forced to operate solely through switching companies held by the Bank of Indonesia.

According to a survey, 1t was found that 90% of Indonesians never bought onl1ne products from abroad, because they believe that it is more expensive and delivery
takes longer.

Indonesia and Philippines being archipelago nations, are facing challenges with the logistics.

Report Southeast Asia Cross~Border E~Commerce Market Mordor lntei!igencr,

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 ( 103)

The cross-border e-commerce market of Philippines was valued at USD 0.7 billion in
2017 and is expected to reach USD 4.67 by 2023 registering a CAGR of 34.53%.
Cross-Border E-comrnerce Revenue in USD
The e-commerce market in the country is the one of the lowest among the six Southeast
Asian countries, but has a great potential, owing to the increasing penetration of internet,
srnartphones, middle-class, and younger population.

From SMEs to large companies in Philippines, the retail industry of the country is turning 4.679

to e-commerce in order to expand their consumer base. Even though, the domestic e-
commerce is poised to witness high growth, there exists high competition with the foreign
brands.

La.zada is one- of the leading_ e-comme-rce web-site in Ph-!l.~ppine-$. According to s survey,

2.629
there are more than 60 million monthly average visitors to the website in the second
quarter of 2018, which is almost more than 30 times to that of other players, such as 1 926

Zalora, Shopee, and eBay. 1.411

Amazon entered Philippines, in July 2017, through Singapore and the products of 0.786
A!ibaba went on sa!e in Philippines through Lazada in November 2017.

Among the six Southeast As1an nations, Philippines has the third highest smart phone
2017 2018 2019 2020 2021 2022 2023
usage. The mobile e-commerce sa!es in the country is expected to witness a rapid
growth, which is expected to increase by 32% in 2018, according to a survey. Year-------+

Report Southeast Asia Cross~Border E~Commerce Market Mordor lntoiiiae'lCe

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 104)

The social media usage is predominantly high in the country and companies need to adopt strategies, such as providing timely information to increase the sales
driven by social media.

The cross-border e-commerce presents huge opport-unity "for the Filipino SMEs to sell their products and services, across the world.

China is a favorable market for Philippines cross-border a-commerce market. The country is improving bilateral relations with China, the second largest economy
of the world and largest cross-border e-commerce market.

The demand for unique products is also increasing, across the world, owing to the cross-border e-commerce. With the presence of rich culture, Filipino buslnesses
have an opportunity to sell their unique local products, fostering the cross-border e-commerce.

A large population base of more than 100 million and high growth rate of the economy offer promising growth prospects, for the Philippines. The average GOP
growth in the past six years is 62% and the per capita GOP is expected to reach usn 5740 in 2028, from around USD 3000 in 2015. The country is ranked 57th in
world in international competitiveness.

Southeast Asia Cross~Border E~Commerce Market Mordor lneii;~:pnco

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 105) ;;;:

fl!i0m,ov<nr;d

8 _"i M-rt'rke~ CotN.:B'ntration Ov<'!Ivievv

"7 "'';-f<.·n-.:-~,_~-rr6:c /'5:d':'·'~t~-:;-;::ff

Report Southeast Asia Cross~Border E-Commerce Market

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8. COI\~PE-riTI\ ( 106)

Vietnam Tiki.vn, Lazada, and Thegioididong.com

Singap-ore Qoo1 0, Lazada, and Amaion recently entered !he Singapore'market

.Phillp_pjnes ,Lazada and Shop'ie

Malaysia 11 street and Lazada

mataharimall.com
Indonesia Elevenia, Lazada, Sh6pee, and MatahariMall

Thailand Lazada, Ebay, Shopee, and 11 street

LAZADA

Southeast Asia Cross-Border E~Commerce Market Mordor lnteiiigcn:::c

"~·'""·"" '" '""""'""''"'~' ''"·" '""'-'"-'1'5'" M"''"' ,,.,,~, ~' c"·"- u"''""'"··< "'"'""""" "'''''"'"'-
8. (107)::

Southeast Asia poses major cross border ecommerce market opportunities. Companies from across the world are investing in the region to leverage the market
potential.

Competition may increase as companies from across the world look to leverage the urbanization and digitization of Southeast Asia.

Though Lazada and Shopee seem to dominate the market, but it is still highly fragmented. Recent entry of Amazon is expected to reshuffle the market with Lazada
(Aiibaba) trying to aggressively improve market share in the South ease Asian region.

The market entry is easy as the barrier is low due to relalively smaller size of the players. Also the players in the market are looking for opportunities to globalize, and
this allow the major international players the opportunity to partner and build their presence in the Southeast Asia cross-border E-commerce market.

Chinese players like JD.com and Alibaba are partnering with local players in the ASEAN countries.

Competition among l·ocal players is high and it is expected to continue, dur!ng the forecast periDd.

Report Southeast Asia CrossDBorder E~Commerce- Market Mordor lntellige:1co

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 (108)

Horizontal Players

Qoo10 ~ X X

Lazada ~ /-X -·x- ~

Bukalapak ;; X X

Tokopedia ./ X X

Eleveriia _ ;; X X

ibli 1
lelong 1 X X

Ensogo 1 X X

Tarad ·./ X X

Metrodeal ./ X X

Vatgia ;; X X

Sen do ;; X X

Tiki X ,f X

The table above shows the business model followed by the horizontal e-commerce players present in the Southeast Asia E-commerce market as of
2014-2015. Quiet a lot of the market participants have been pivoting and diversifying/testing business models in the last 2-3 years.
Market place is the dominant model among the horizontal players.

Report Southeast Asia Cross~ Border E-Commerce Market Mordor ir·,teliigc;,:;c

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8. <=TITIH<: LANDSCAPE ( 109)

Vertical Players

Zalora X X ../

Reebonz X X ../

FashionValet X ../ X

thegiodidong X ../ X

HipVan X ../ X

The table above shows the business model followed by the vertical ecommerce payers present in the Southeast Asia E-commerce market as of 2014-2015.
Inventory is more popu!ar among vertical p[ayers

Report Southeast Asia Cross~ Border E~Commerce Market Mordor lntdiigcncc

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8. ( 110)

c Cnmmp,·-,''J> As~··~!l~Hrl!?"t

Medium
Opci8:thig Eil:VJ·roh!jl-e-h'L-- ·Medium.: Metlium: :MB·O-iUm Medium

Medium
MSME Readiness Medium High High Medium Medium

CHsto:mar VVintngn·ess -'tow Medium tdiiV High Mediutn Low

Mectiurn
Marketplaces and Platforms Medium MediUm High High High.

Payments Medium Medium Low High Medium Low

Medium
Logistics Low Medium High Medium Medium

Customs.and .Border Admin. Low Medium Low High Medium Loy;

Foreign Market Access Low Medium Low High Medium Medium

Regulatory.l;ll:i!£~~~:~ ;,:>'
Medium

Report Southeast Asia Cross~Border E~Commerce Market Mordor i;-;teiligen~c

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S.GOMP <111)
E-commerce operating environment: Measures the quality and functionality of thee-commerce operating environment

MSME readiness: Measure the ability of MSMEs in the economy to engage in both domestic and cross-border e-commerce.

Customer willingness: Measures the willingness of customers in the specific economy to engage in both domestic and cross-border e-commerce.

Platforms and marketplaces: Measures the availability and quality of platforms and marketplaces as related to cross-border e-commerce.

Payments: Measures the availability and quality of payment means, methods, and platforms for cross-border e-commerce.

Logistics: Measures the availability and quality of logistics operators and options for domestic and cross-border e-commerce.

Customs: Measures the quality of customs as related to cross-border e-commerce

Foreign market access: Measures the ability of foreign players to be able to access the domestic market, especially as related to cross-border e-commerce.

E-co.mmerce reg_ulz..tory environment; f\.1easures the qua!:ty of reg.ulations as related to domestic and cross border e-commerce.

Cross-Border E-Cotnmerce Assessn1ent

Each economy has several areas where it can improve. Singapore cones out as the most advanced and ready economy for ecommerce market.

Malaysia is another market that has high market potentia[ for cross border e-commerce market. Presence of large number of local players in the countries has
helped the market growth and allowed the supply cha1ns to be firmly settled in these countries.

Vietnam is another emerging country which has untapped potentia!.

With building infrastructure in rest of the Southeast Asia countries, the grovvth of the cross border ecommerce is expected.

Report Southeast Asia CrossmBorder E~Commerce Market

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Alibaba Group is a Chinese conglomerate that serves the areas of multinational e-commerce (retail and wholesale),
internet, Artificial Intelligence, and technology. The company provides sales services for business-to-business,
business-to-consumer, consumer-to-consumer, and payment services through Alipay.

The core business of the company is commerce in China and other nations. Southeast Asia is one of the vital regions
Founded- April4, 1999, in
for the company's commerce businesses, outside China. Hangzhou, China

The company operates and generates revenue from international commerce retail businesses primarily through Hangzhou, Zhejiang, China HQ
Ali Express and Lazada. The transaction value on AliExpress for FY 2017 was USD 7.2 billion.

The company witnessed an increase of 58% in the revenue of the Fiscal Year (FY) ending on 31 March 2018. https:l/www.alibabagroup.com

FY201{).,£0"i8

250,266

2015-16 2016-17 2017-18

Report Southeast Asia Cross-Border E~Commerce Market

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 ( 114

China Commerce Retail

China Commerce Wholesale

International Commerce Retail

;~;4;(X;i:i ·:· International Commerce

Wholesale

Cainio Logistics Services

Others

Cloud Computing

Digital media and entertainment

Innovation initiatives and others

Southeast Asia Cross~Border ErnCommerce Market Mordor lntellige,-;::;:c

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 115)1!:

International Revenue in RMB

FY201
16000
Indicators, Year~on~Year Growth
FV:l01 .~.• ?1118 14000

'100 12000

90 86 c:: 10000
~
E 8000
80 QJ

~ srvy;

4000
58
56
52
r:
"'0:: r;:r, "''""•,_.,.,
~-5
42
-~0
FY 2016 FY 2017 FY 2018
~
3'] -z~;;_ei; ·.,~--~e-~- -,,;-:::
3l: 25

Tmall Global is the Cross-Border platform of the company that helps the
brand and retailers acro-ss the world to reach Chinese customers, without
1U
any physical presence in China. Almost 18,000 brands from 74 countries
and regions are selling into China through Tmall global, as of 31 March
FY2014 FY2015 FY2016 FY2017 FY2018
2018.
r;:.cven:Je ;,_,jj:..,SleJ Cdi 1-,:.:..

Report Southeast Asia Cross-Border E-Commerce Market Mordor intcl!igcn0c

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 ( 116)

aba oud

UC 1\,levvs

/ -~

Smarter Shopping, Better Living!

~~83~Pm
TMAll GLOBAL LAZA~Q6 j c:::::; :(i:i!ii tth rs2l
lo:::::a) I iiii .ll!! ~
amap.com

Report Southeast Asia Cross~Border E-Commerce Market Mordor into:iigence

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9.1 ALIBABA C::ROIIP~.t:nll <117)
Southeast Asia, the emerging hotspot of the global e-commerce is one of the The company considers Lazada as the vehicle for expanding its footprint in

important and biggest market overseas for Alibaba Group. the Southeast Asian region and also to improve the cross-border

The company's journey in Southeast Asia began with the launch of Taobao, its opportunities for the Chinese merchants by introducing them through this

online shopping marketplace in Singapore, in September 2013. Also, the company marketplace.

bought a stake in Singapore Post in May 2014, to expand its e-commerce Lazada offers a reliable delivery with its own logistics infrastructure,

business. warehouses, and last mile delivery fleet.

By purchasing 83% of the stake in Lazada which is one of the leading operators of Besides the retail e-commerce platforms, the company operates its

e-commerce platforms in Southeast Asia, the company expanded in the region. wholesale platform "Aiibaba.com," across the world.

Lazada offers a marketplace solution for merchants with simple and direct access Apart from buying Lazada, the company is continuously expanding its

to consumers in the countries, such as Indonesia, Malaysia, the Philippines, presence over the region by increasing investments and through acquisitions

Singapore, Thailand, and Vietnam through one retail channel. The company of start-ups.

operates the websites and the mobile applications in the local languages and also !n November 2017, A!ibaba acquired RedMart, an online grocer start-up in

sells products owned by its retail operations. Singapore, which offers home delivery of frozen foods.

For the Financial year ended on March 31, 2017, there were -23 million annual Alibaba, one of the dominant players in China, is expandrng in Southeast

active buyers in Lazada. Asia through existing players instead of building from scratch.

The company is investing vast amounts in Lazada targeting highly competitive and The company 2.!-ong with the Malaysia Dig ita! Economy Corporation launched

emerging Southeast Asian e-cornmerce market. The total investment of the a digital free trade zone or e-hub in Malaysia, in May 2017, under electronic

company reached USD 4 billion with the company announcing an additional world trade platform (eWTP). eWTP is the vision of the company to burld a

investment of USD 2 billion in March 2018. virtual and borderless global commerce platform.

This additional mvestment follows the initial purchase with USD 1 billion and the The company also raised an investment of USD 1.1 billion in Indonesia

placement of another USD 1 billion in 2017. based e-commerce firm Tokopedia.

Report Southeast Asia Cross~ Border E~Commerce Market Mordor lntdligsncc

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 ( 118)

A strategic partnership was formed between Alibaba and the government of

Thailand for the development of the digital economy of Thailand and

Tmall, E-Commerce platform of Alibaba, adopted blockchain Eastern Economic Corridor (EEC), under the Thailand 4.0 policy. The

technology in its cross-border supply chain by partnering with the partnership supports the cross-border online trade by small enterprises and

logistics company Cainiao. With this, the cUstomers \Nill :Oe Clble to farmers. The meas under the development include e-commerce, digital

track the blockchain-based logistic information for some 30,000 logistics, tourism, and training. A Smart digital hub will be established in

goods from 50 countri@S throug-h the e-commerce's mobile EEC by Cainiao of Alibaba that supports the cross-border trade with China

application. and other markets as well. I

!

Mar 2018 Apr2018 1

Lazada launched a cross'border service between Malaysia and

Singapore. Its pilot service enables the sellers in Malaysia to market their

products in Singapore. The D1gital Free Trade Zone (DFTZ) and

Alibaba announced an additional investment of USD 2 billion in
exemption of GST provides hassle-free trade.
Lazada Group, the largest e-commerce platform of Southeast Asia
Apr2018
to expand its growing business in the region. This investment
makes the total investment of Alibaba in Lazada to reach USD 4
billion with an previous investment of USD 2 billion.
Mar 2018 0
Merger and Product Expansion Partnership
Acquisition Innovation

Report Southeast Asia Cross~Border E~Commerce Market Mordor in:ollige·~::c

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 ( 119)

Amazon is one of the largest online retailers in the world. It was also featured among top 10 global brands in the top
500 global brands 2017 list, released by an industry source specializing in brand valuation. The products offered by the amazon
.,, ~

'~tWf;!\''1'15;i?'"rr f
company include merchandise and content purchased for resale from vendors and products offered by third party
sellers. Y::'c

Founded in 1994
The company majorly generate revenue through segments, such as online store, third party seller service, Amazon web
service (AWS), Subscription service and physical store. Washington, USA

1 206 266 1000

In 2017, AWS announced more than 1,400 significant services and features, including Amazon SageMaker, which
radically changes the accessibrlity and ease of use for everyday developers to build sophisticated machine learning
https://www.amazon.com/
models.
i··

177.86

2015 2016 2017

Report Southeast Asia Cross-Border E~Commerce Market Mordor bte::ige~ce

t>-~"""-''"4 b'/ '"" <>b~•d-0\ ~""' 15<J.;)·Un51 .t 10E>.1o-04 "'-"~' BST. '"'"- ""'""'o'""'-' Di<~'"oCoo """"'''''
9.2 AIV!ALU ( 120)

Er;;.;;,> )i,--A· ,;.,m,:xzon inc:., i\i?f

tr Online Store

Thirdparty Seller service

m Nortt1 America

Amazon Web Service International

Amazon Web Services (AWS)

Subscr)ption Service

Physical Store

The company generates about 60 % of its revenue from North American

The online store segment witnessed an increase of about 18.6%. This is due market, due to its strong presence in the area. The sales growth in this region
to increasing number of internet users, around the world. in 2017 has been impacted by the acquisition of Whole Foods Market
With the cloud advancement and middleware technology, Amazon web
The increase in international market is due to increasing presence of amazon
service (AWS) is also expected to expand, during the forecast period.
in emerging countries. Additionally, the expanding retail market in Asia-Pacific
is also thriving the market share of amazon.

Report Southeast Asia Cross-Border E~Commerce Market Mordor 1ntv~:igsncc

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 ( 121)

Amazon designs its websites to enable the sales of millions of products, Furthermore, Customers ordered more than 40 million products from SMBs
where some of these products are sold by Amazon, while third-party worldwide during Prime Day 2017, which represents a growth rate of 60% over
vendors sell the others. Prime Day 2016.
The company also manufactures and sells electronic devices, which Amazon's Global Selling program, which enables SMBs to sell products across
include Kindle e-readers, Fire tablets, Fire televisions (TVs), and Echo. national borders increased by over 50%, in 2017, and cross-border e-
It also produces and develops media content. commerce by SMBs currently represents more than 25% of total third party
Amazon provides merchandise at the lowest possible prices by sales.
adopting common low product pricing strategy and through various
shipping offers. and also through membership in Amazon Prime.

Amazon fulfills customer orders through its fu!fil.\ment centers and

• delivery networks located across f\Jorth America and other foreign Amazon is one of the l·eadlng players in the online retaiMormat.
Countries. By leveraging its online retailing capabHity, the company is
Amazon also focuses on sell-ers by offering programs that enable them adopting top line growth strategies from the growmg online
to sell their products on their websites and even on Amazon's sites. sales market, globally.
For the first time in Amazon's history, more than half of the units sold on

Amazon worldwide were from their third-party se!fers in 2017, which

includes small and medium-sized businesses (SIV1Bs).
Around 300,000 US-based SMBs started selling on Amazon in 2017,
@ .

.
The company spend highly on R&D and focuses mainly on
product and service innovation. This has helped company to
have competitive advantage on global level also.
Company has entered a wide range of industry, which helps
and fulfillment by Amazon shipped nearly billions of items for SMBs company to leverage on its brand value.
worldwide.

Report Southeast Asia CrossfflBorder E~Commerce Market Mordorl"~~c· ige~ce

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 9.2 ING.·KI: ( 122)

nf

3,67 0,21
Office space 12,712 3,674 7,466

Physicalstoies 20,34~, , .735 202 ('; ..

F-toi"lfiHm-ent data
131,419 4,406 67,832 5,190
_ centerS;' and other

Total '~-?_4;480 8,815 75,500 5.190

Niark;;:.;tin9

T echno!ogy and

Ceru2(;_il snG ,,,m;a::s:•at••s

United States 70.5 90.38 120.49

Other operating expense
Germany 11.82 14.15 16.95

United t(ingii&11J 9.03

Japan 8.26 10.8 11.91

:R~~~o~N\~q(ld·'··· .. 7.36

Report Southeast Asia Cross-Border E~Commerce Market Mordor lnte::igenco

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----------------------------------------------------------------------------------(~123)
ASIA

The e-commerce player Amazon made its first venture into the region with the Additionally, the US e-commerce group plans to partner with the Vietnam E-

launch of its fast delivery service Prime Now, in mid-2017. The service offers commerce Association of online merchants (VECOM) in the Southeast Asian

free two-hour delivery from its local warehouse with a minimum order of USD country.

40, which is exclusive for members. The partnership with Amazon is expected to give VECOM's members a

Singapore is the 16th country and the first in South-east Asia to launch platform for increasing exports of Vietnamese-made goods to international

Amazon Prime, which gives online members perks like free shipping and markets.

access to other services. But for Amazon, this represents JUSt the first stage of its entry into the

Prime Now offers quick delivery options for local products, which are available emerging economy with a population of more than 93 million and increasing.

and delivered within Singapore and international products, which are available Besides intense competition from e-commerce players, many Vietnamese

and shipped from the United States. This has leveraged the cross-border e- sell products through the social network. This trade has gotten so sharp that

commerce trade, where Singapore locals ab!e to buy product::B from other the Vietname::;e government even considered taxing such transactions.

countries. Hence, it is not easy for Amazon to enter the markEEt.

To suppon: its delivery promise, Amazon opened its new Prime Now 100,000 Amazon !aur.chcd international shopping experience feature, which !1e!ps the

square feet fulfillment center in Singapore. Thailand consumers to order the wide portfolio of products and they gets

Additionally, to increase its footprint, Amazon plans to build logistics shipped from United States.

infrastructure in the region. According to the sources from Vietnam Post, one of
the largest local logistics companies in Vietnam, it was working with Amazon
Alibaba Group Ezbuy
on a plan to build a bonded warehouse for Amazon in the northern part of

l
eBay Vcanbuy
Vietnam, near Hanoi's international airport to cater to the increasing cross-
JD.com Etsy .
border shipments, across the region.
ASOS Fado )

Report Southeast Asia Cross-Border E~Commerce Market Mordor !nte!ligencc

""""'"'·''"''''"""""''~"'""''""' ""·"·m~'·""'""'"""'"'·""'""~·"'""·'·"'"""'"""""'"''''""""''"''''''·
 (124);;;;

People in Thailand can now buy any of the 45 million items available
on Amazon. com, with the launch of a new feature "International
Shopping experience". This feature allows customers to shop in 25
currencies, including baht and the items ordered via the feature will Amazon opened opportunities for Thai small and medium-sized enterprises
be shipped to Thailand from the United States. (SMEs) as the group plans 0 to expand its footprint in business-to-business
. Apr 2018 (828) e-commerce. Amazon joined hands with Siam Commercial Bank,
Payoneer, E-Commerce Education, Benzio institute, and DHL to ]@lunch a
Facebook page Jum·pstart Chiang l\Jlai, allowing new vendors to sell their -
products in the United States.
Mar 2018

Amazon launched express delivery service in Singapore, and it

was marked as the US online retail giant's first venture into

Southeast Asia and a move that put it in direct competition with
China's Alibaba. Prime Now allows Singapore customers to order
products from Singapore as well as international markets.
0
Merger and Product Expansion Partnership
Jul2017 Acquisition Innovation

Report Southeast Asia Cross~Border E~Commerce Market Mon:ior I"~Lsiligc:>e-o

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 ( 125)

eBay Inc. provides online marketplaces for the sale of goods and services with other online commerce, platforms, and
online payment solutions to businesses and individuals in the United States, and internationally. Collectively, the
company connects millions of buyers and sellers around the world.

The technologies and services that power its platforms are designed to enable sellers, worldwide, to organize and offer
Founded - 1995
their inventory for sales, and also for buyers to find a product and purchase it, virtually anytime and anywhere. The
group engages in the provision of investments and acquisitions to help enable commerce on its platforms for buyers
California, United States HQ
and sellers online, as well as on mobile devices.

The company classifies its business operations mainly into three platforms, which are Marketplace, StubHub, and https :1lwww. ebay. com/
Classifreds

U~3Li

9,567

2015 2016 2017

Report Southeast Asia Cross-Border E-Commerce Market Mordor lntul!igcncco

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9.3 ( 126)

Breakdown, FY

Net Transaction--i\tlarket Place

Marketing Services and other-

Market Place
Net Transaction--S!ubHub

Marketing Services and other-

Ciassifieds
Marketing Services and other-
StubHub, Corporate and other

Report Southeast Asia Cross~Border E-Commerce Market

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9.3 !::~AY-!\1:: ( 127) ;:

EBAY Prooerties"
As Of Dec 2017
eBay's strategy is to drive the best choice, the most relevant, and the most robust
selling platform for the buyers and sellers. It also focuses on connecting buyers and
sellers through various simplified experiences to make it easier for users to list out,
Owned Facilities 1" 1 1.1 find, and buy items.
The group provides many features for its buyers and sellers, which are designed to
Leased Facilities 0"8 4"0 4.8
build trust and make users more comfortable, while buying and selling on the
Total Facilities 1.9 4.0 5.9 platforms. The company also rewards the top sellers for their loyalty

eBay regularly reviews and manages its investments to ensure they

support eBay's stra~egic dir®cilon; and complement its disciplined
approach to value creation, profitability, and capital allocation. The
group made a USD 500 m!!lion cash investment in the eBay India
business and sold it to Flipkart in the late 2017. eBay and Flip kart made
an exclusive agreement, in which they plan to jointly pursue cross-
border trade opportunities to make eBay's global inventory accessible to
the Indian consumers, while eBay's millions of active buyers, globally,
=United States United Kingdom Germany m Rest of the World would have access to Indian inventory provided by Flipkart.

Report Southeast Asia Cross~ Border E~Commerce Marke-t Mordor Intelligence

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>L
 (128)

Marketplace: Marketplace primarily operates through the e-commerce ;~f

platform, eBay.com, and other localized sites, such as eBay.de and

eBay.co.uk, which allow buyers and sellers to interact and trade with one
another_ eBay.com offers new, refurbished and used products, common and GiCissMerchandise Voi!Jme (GMV) (lJSD'Billioii)

rare items, and branded and unbranded products. Marketplace 77.73 79.18 83.88

>S!ubHub "·.5
StubHub: StubHub is a marketplace for event tickets that operates through
.Total GMV 81.3. 83.49 88.4
online web portal stubhub.com. lt enables viewers to buy and sell tickets for
--Transaction·:rake R·ate1 %) .
theatre, sports, concert, and !lve entertainment events. StubHub platforms
include online ticket platform located at wwwstubhub.com and the StubHub Marketplace 7.85 7.71 7.69
I
mobrle apps These platforms provrde fans wrth a safe, convenrent place to

l purchase trckets to the games, concerts, and theatre shows they want to
~and an easy way to sell trckets ~
StubHub

Total Transaction Take Rate

20.30

840
21.76

8.44
22..35

8.44

eBay Classifieds Group: The Classifieds platform operates classifieds

1. Transaction Take Rate is defined as net
websites, principally designed to help users list their products. These
transaction revenues divided by GMV
classifieds have listings in over 1,500 cities. The classified sites include eBay
Classifieds, Kijiji, Gumtree, Marktplaats, eBay Kleinanzeigen, and Mobile. de.

Report Southeast Asia CrosswBorder E~Commerce Market Mordor lntoi!igePce

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 ( 129)

eBay has a strong footprint in most of the Southeast Asian countries. Additionally, President Smorn Terdthampiboon praised eBay as the rnost

According to industry sources, Thailand is eBay's largest online retailer in the active website for Thai cross-border e-commerce retailers with more than

South-east Asia. 10,000 merchants.

The e-commerce operator is gearing up to get rnore small and medium-sized eBay invested in Indonesia to set up a representative office in 2016, and

exporters in the country to use its platform and promote the eBay's strategy the company specially appointed "Head for Cross-border Trade" to

of expanding cross-border e-commerce in the region. strengthen its position in the market.

Out of eBay's six major markets in South-east Asia, Thailand had the highest This was not the first time eBay has set up business in Indonesia. The e-

number of sellers and the highest trading value by surpassing Singapo1·e, commerce player is already running a joint venture called Blanja, along

Philippines, Malaysia, Vietnam, and Indonesia. with state-owned telecommunications operator Telkom.

eB2}' identified the top five markets for Thai sellers were the United States, Singapore peopl-e appear to have a higher demand for cross-border

Australia, Britain, Canada, a.nd Russia. eBa.y Thailand registered most of its shopping. Two out of the top five most visited e-commerce websites are

revenue from business-to-consumer (B2C) sales outpacing its C2C plat7orm. platforms, \Nhich hugely support such services by aiming to make the
cross-border shopping process more comfortable for the consumers.
Recently, Thailand Post has set an aggressive goal for its international
business and expand cross-border e-commerce through a partnership with According to industry sources, eBay is the third most visited e-commerce

one of the world's largest e-commerce giants eBay. site in Singapore in the first quarter (Q1) of 2018, which was followed by
Ezbuy.
Thailand Post added new services to help local online retailers deliver their
products abroad for 20% lower fee than its global competrtors, such as DHL. eBay sold most of its products mainly from overseas. eBay Singapore

Currently, DHL controls around 45% of the cross-border e-commerce service stated that cross-border trade is its main focus for the platform, since it

in Thailand, with Thailand Post maintaining 30% in 2017. makes up the overwhelming majority of transactions in Singapore.

Report Southeast Asia Cross-Border E~Commerce Market Mordor Intelligence

""'""""'"' "'""""""""'"""' '"'" ""·"·'!'~' ~ "''""''"""' "''·""' "''· '""· "'·~*•'""""' """''"~·· """'"'""'-
 <130)
Most of the Singapore sellers are benefiting from eBay in reaching the
international markets.

For instance, Gift Time, a watch retailer, made around 90% of its sa!es from
overseas. lts top markets inc-lude Europe, the United States, and Australia,
which helped the company make about SGD 10 million in sales, in 2016 Alibaba Group Ezbuy

Amazon.com Inc. Vcanbuy

It has also JOined other e-commerce platforms, such as Qoo1 0 and Lazada,
JD com Etsy
but eBay remains the most significant driver of 1is sales.
I r\SOS Fa do
Another of eBay Singapore's top-growing cross-border-trade sellers is J316,
r j
I "''"vn
V.;ith 1he YoY 9rovv±h rate of 1"73% ·on eBay with an estimated tu"rnover of SGO \ ~

1 million in 2017, after just two years on the platform.

Indonesia Malaysia Singapore Philippines Thailand Vietnam

Report Southeast Asia Cross~Border E~Commerce Market Mordor lntelligonce

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 ( 131)

Global e-commerce platform, eBay, which launched its "Go Global with eBay"
initiative almost a year ago, managed to attract more than 3,500 Malaysian
businesses. Head of Seller Growth (SEA Cross Border Trade) of Malaysia
said eBay was focused on offering localized seller support to catalyze the
growth of cross-border trade in the country.
Jun 2018

Thailand Post partnered with eBay, as part of its ambitious goal to

achieve 4 billion baht in revenue through its international businesses by

~
expanding cross-border e-commerce. The connection between these
two firms is expected to help Thai retailers capitalize on cross-border e-

commerce at lower costs. Merger and Product Expansion Partnership

Acquisition Innovation
May2018

Report Southeast Asia Cro:sswBorder E-Commerce Market Mordor intdliqenc:l'

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 (132)

JD.com is a technology-driven E-commerce company. It engages in the sale of electronic products and general
merchandise products, including audio, video products, and books.JD.com Inc (JD). JD is an e-commerce company,
which provides consumers with online retail services through mobile applications and website, www.jd.com. It is a
member of the Fortune Global 500 and offers a wide selection of products at competitive prices. JD.COM mffi
Founded- 1998
The company also provides online and in-person payment opti611s and customer services. The company operates
through the following business segments: JD Mall, and New Businesses. The JD Mall segment represents its core e-
Beijing, China HQ
commerce business. The New Businesses segment includes logistic services provided to t-hird parties, technology
services, overseas business, and insurance.
https:lljd.coml
lt also provides an online marketplace, whereby third-party sellers sell pr?_duc;ts to customers primarily through its
websites and mobile apps. The company offers advertising, logistics, and other value-added services.

362,332
.0
. · .· , ~.·
·rill .· I .··
>'vv••·•.

2015 2016 2017

Report Southeast Asia Cross-Border E~Commerce Market Mordor lntelli[:JBn::::e

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9.4 JU.vU ( 133)

JD.com Revenue Brealkd<Jwn, 2017

-0.15%
0.23%

JD Mall

New Busitlesses

Others

lntersegment

97.96%

Report Southeast Asia Cross~ Border E~Commerce Market Mordor Intelligence

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 <134)

----- ------ ----

The company aims to cater evolving consumer demands and believes technology advancement will further transform the retail infrastructure and experience.
The strategy for the next twelve years will be based on "Retail-as-a-Service." On one hand, JD is said to continue expanding its e-commerce businesses, while
striving to reduce costs, improve efficiency, and enhance the customer shopping experience, while proactively exploring innovative new business models.
On the other hand, it is opening up the established infrastructure to all the partners to empower retailers, suppliers, and designers among others, with JD's supply
chain, logistics, tec~nology, and other capabilities.

1 2EU CC'
Proc.Ju.:t-Ciec:rcmc::; cnw
:--!o;r;c ."·::Jp!i 3 :

"!000

800
Net Prod:.:c:-General 600
Produds

200
0
Net Service Revenues 2015 2016 2017
--Series 1

Report Southeast Asia Cross~Border E-Commerce Market Mordor lntc!!igencc

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9.4 <135)

E-commerce: JD.com is one of China's leading one-stop e-commerce platforms. which provides over 300 million active customers with direct access to a unique
range of authentic, high-quality products, and helping leading local and international brands to tap into China's fast-growing e-commerce market. JD.com sets the
global standard for the online shopping experience, which offers a vast selection of products, across every major category, like electronics, apparel and home
furnishings, fresh food, FMCG, home appliances, and others, and delivering them at amazingly fast speeds to provide a one-stop shopping experience for Chinese
, consumers.

"-··
Logistics: JD Logistics, a business group under JD.com, 1everages the group's advanced technology and logistics expertise to provide smart supply chain and
logistics services to businesses across a wide range of industries in China. JD.com has one of the most substantial fulfilment infrastructures of any e-commerce

company in the world. JD.com is the only e-commerce platform in the world to provide small-to-medium sized warehousing, oversized warehousing, cross-border,
co!d chain delivery, frozen and chilled \:Varehousing facilities, 828, and cmwdsourcing logistics.

Technology: JD is at the leading edge of industry inno•;ation, vvhich focuses on developing an incredibly efficient retail supply chain, and innovative modern
technologies and services that enhance the experience for the consumers, and brand and merchant partners. JD's global R&D efforts are headquartered at its
Silicon Valley R&D Center in Santa Clara, CA. The Silicon Valley R&D Center draws together leading talents in sectors, such as machine learning, big data, cloud
computing, and AI, to develop cutting-edge innovations that enhance the retail experiences for more than 300 million active users and their hundreds of thousands
I
of brand partners.

Report Southeast Asia Cross~Border E~Commerce Market Mordor lntei:igence

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 JIJ.I,.,UIVI ( 136) : :

JD operated 486 warehouses with an aggregate gross fioor area of approximately

10 million square meters in 78 cities, as of December 31, 2017, and had 84,790 :; '"'7

delivery personnel, 33,153 warehouse staff, and 12,760 customer servke

personnel. Using this nationwide fulfillment infrastructure, the group deliver a
majority of the orders directly to customers themselves. Cost of revenues 158,960 222,935 311,517

Fulfillment 12,367 18,560 25,865

Marketing, 7,233 10,159 14,9.18

Techn_obgy and co-ntent 2;902 4,453 6,652

JD launched a cross-border e-commerce platform, JD Worldwide, on JD.com in April General arid administratiVe 2,188 3,436 4.215
2015. JD Worldwide is committed to providing consumers in China with high·quality,
Other 2,750
authentic imported products from worldwide, and to serving as a gateway for leading
Totaloperating expenses 186,400 259,543 363,167
international brands to reach the Chinese market. Since its launch in 2015, JD
Worldwide has offered products in a wide variety of categories, including maternal Loss from Operations 5,358 1,253 835
and childcare, nutrition and healthcare, personal care and cosmetics, electronics,
household and kitchenware, food, and car accessories among others. JD Worldwide
sources products from over 70 countries and regions, including the United States,

Canada, South Korea, Japan, Australia, New Zealand, France, and Germany among
many others.

Report Southeast Asia Cross-Border E-Comrnerce Market

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 ASIA

In a strategic move to expand its services globally, China's JD.com JD.com is expected to join Google Shopping, an advertising platform for online

launched its new cross-border e-commerce platform, JD Worldwide in merchants, where its products could be available to consumers, globally. Through

2015, which was regarded as a direct challenge to Alibaba Group's this partnership, JD plans to tie a link between ASEAN consumers and the Chinese

Tmall Global Service. vendors, since Chinese smartphones brands, such as Oppo, Vivo, and Xiaomi have
proven to be a huge hit among consumers in the region of 650 million people with
JD Worldwide enables Chinese consumers to purchase authentic
their affordably-priced models.
imported products, which include many products previously unavailable
1n China, and also allow international producers and suppliers from JD.com expanded its foothold in Southeast Asia with its latest USD 44 million

Europe, ASEAN, and North Amer1ca to sell directly to Chinese investment in Tiki, Vietnam's leading B2C e-commerce platform, which is expected

consumers, without requiring a strong established presence in China. to allow the two to work on a range of areas, including cross-border trade,
merchandising, logistics, technology, financing, and operational capabilities.
JD.corn already had an established e-commerce platform in lndonesia,

and additionally partnered with Thai conglomerate Central Group to Tiki launched cross-border channel backed by JD.com on July 2018.Tiki officially

enter Thailand_ The Thai launch is one of the iatest in a string of moves, launched its first cross-border orO:ering service Tiki Glob-s! and a JD.com e-

as the brand seeks to expand its footprint in the Southeast Asian commerce pavilion, which have thousands of original genuine goods on offer from

region, and remain hot on the heels of rival Alibaba. its foreign partners.

The online marketplace www.Jd.co.th is operated by Central JD Tiki's new shopping channel enzbles ASEAN consumers to purchase original foreign

Commerce, the joint venture between JD.com and Central Group. goods without any intermediates. Products currently sold on Tiki Global are mainly
electronic equipment from China, cosmetics, and items for mothers and babies.
Additionally, Chinese online retailer JD.com signed Google as a
strategic partner, in a move seen to complement the JD's ambitions to Expansion of its services in Southeast Asia by linking with g!oba! markets, especially

expand into Southeast Asia in June, 2018. China, is part of JD.com's strategic move to compete with its rival Alibaba.

Report Southeast Asia Cross~Border E~Commerce Market Mordor into!!igcnco

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 ( 138)

Analyst View
JD.com invested USD 44 million in the Vietnam based B2C e-commerce
JD.com plans to enter the Southeast Asia cross-border e-commerce platform, Tiki. Through this strategic investment, Tiki launched its first ever
industr-y with strategic investments and partnershi!JS with coun~ry cross-border s--commer·ce channel. Ti!-<i Glob81, which enabies ths- Southeast
leve! e-commerce platforms. Being a strong member in China cross- A£ian consumers to purchase goods from foreign markets without any
border e-commerce market, the group can use its expertise to enter intermediates.
the ASEAN market and provide strong competition to i:s rivals Jui 2018
Alibaba and its subsidiaries. Addit"ronally, huge potentiai and growth
rates are anticipated in all of the Southeast Asian countries, which
are further expected to provide the company more opportunities to
capture the market.

Merger and Product Expansion Partnership

Acquisition Innovation

Southeast Asia Cross-Border E~Commerce Market Mordor lnto!iigenv:

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9.5 AS\JS-I:JVE:RVIEW (139)1:

asos
ASOS is an independent online fashion retailer, based in the United Kingdom. The company sells more than 85,000
branded and own-brand products for men and women through its localized mobile and web platforms. It also offers a wide
variety of fashion-related content to the customers through asos.com.

ASOS also operates country-specific websites targeting customers across the United Kingdom, the United States,
discover fashion online

Australia, France, Germany, Spain, Russia, and Italy and served approximately 15.4 million active customers, as of 2017. Founded- 2000

ASOS products have a wide range of clothing to accessories, which include bags, caps, sunglasses, watches, etc.
London, UK HQ
Additionally, The company delivers its products from its fulfilment centers located in the United Kingdom, the United States,
and Europe to 240 countries throughout the world.
https :1 /asos pic. com/
The company runs with a stmng mission to become the world's number one destination for fashion-loving people with
variety of collections

1.923.6

2015 2016 2017

FY 2017 ended August 2017

Report Southeast Asia Cross~Border E-Commerce Market Mordor Into iigencc

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9.5 AS,OS··O\i'ERVI <140)
rY ~;Ji

0.33%-

" Retail sales

Delivery receipts
-Third-party revenues

Jnted Kingdon'

United Stales

European Union

111 Rest of the world

Report Southeast Asia Cross-Border E~Commerce Market

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 9.5ASOS-K!:: METRICS (141)1:

OPERATING COSTS 2017 KEY METRICS, 2016-17

Active customers 1 (million) 15.4 12.4

Distribution costs 299.2 15.6 Average basket value (including VAT) 72.24 70.84
(GBP)
Payroll and staff costs 162.8 8.5
Average units per basket 2.87 2.82
Warehousing 168.5 8.8
Average selling price per unit 25.16 25 09
Marketing 86.8 4.5 (including VAT) (GBP)
Average Order frequen_cy 2 3.22 3.08
Production 6.8 0.3
Total orders (mil Iron) 49.6 38.3
Technology costs 35.1 1.8
T~~-!
IU(dl (ir1i1licn) I ,669 1",348.7
Other opemliiiQ cosis 77.2 4
Conversion 3 3 2.8
Depreciation and amortization 42.3 2.2
Mobile device visits 70.3 65.5
Total operating-costs 878.7 45.7

1 Defined as having shopped during the last 12 months, as at 31 August 2017.

2 Calculated as, last 12 months' total orders divided by active customers.
3 Calculated as, total orders divided by total visits.

Report Southeast Asia Cross~ Border E~Commerce Market Mordor lntc!Hger:cc

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 ( 142)

ASOS caters to global markets through the fulfilment centers in the United
States and Europe. Singaporeans are major customers of ASOS across the
Southeast Asia region.

ASOS doesn't have a direct presence in the region, but the group maintains its
website in all of the 6 SEA countries and also offers free international shipping
on some terms and conditions.
0

Due to the issues :'aced in terms of product quality, size-fit, etc. cornb,ined vvith i\lib8ba Group

unreliable return policy, ASOS received several negative rev'tews from Amazon. com Inc.

Singapore. Hence, ASOS launched an international return policy for its buyers. JD.com

within a specific period of time. e8ay

Ezbuy
Currently, ASOS have engaged Aramex, ~nternat1onal express, mail delivery,
Vcanbuy
and logistics services company, to manage its returns in Singapore, as per the
Etsy
return policy in the ASOS.com.
Fado
Additionally, besides its official marketplace, ASOS also sells its products
through Lazada in most of the A SEAN countries.

LAZADAu
Report Southeast Asia Cross-Border E-Commerce Market Mordor lritel!igence
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 ( 143)

ezbuy was founded in 2010, by a group of aspiring entrepreneurs having a single mindset to bring quality products in a
®
convenient way to the locals via its platform. As of today, ezbuy has more than 3 million customers from Singapore,
Malaysia, Indonesia, and Thailand.

Ezbuy have also brought millions of quality products from China, USA, Taiwan, Korea, and locally for the customers. The
Founded - 2000
company strives toward service excellence, while keeping its focus on local demands, so as to develop new services that
better suit the customers.
Singapore HQ

That is why ezbuy have the Prime service and expanded the marketplace from China to USA, Taiwan, and Korea. More
than an international shopping platform, ezbuy focuses on creating simple yet complete solutions from sourcing to https//ezbuy.com/

shipping.

(j(j(j ..~/
~("":?"1'~1" .

Report Southeast Asia Cross~ Border E~Commerce Market Mordor beirigence

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9.6 EZBUY-SERVIC ( 144)

~
f
ezbuy allows the customers to shop locally, as well as globally.
ezbuy offers special prime membershrp, which involves the
I Having over few millions of products from China, USA, Taiwan,
customers to enJOY SGD 3 flat international shipping fee when the
Korea, and locally allows ~he customers to get what they need, in
people shop under the prime category. This category consists of
just one single piat-form Ezbuy has customer presence 1n
products from China, USA, Taiwan, and Korea.
Singapore, Thailand, Malaysia, and Indonesia
'-.., ____ ,

ezbuy purchase products on behalf of customers from

Besides shopping, ezbuy provides just international shipping as
USA, and Taiwan, and ships them in the most convenient, hassle-
welL The process involves customers getting the specific overseas
free, and worry-free service. ezbuy also provides inspection, free
Ship-For-Me shipping address and start sending the purchases
repacking, and consolidation service. ezbuy offers over millions of
from China, USA or Taiwan to ezbuy. The company looks after the
products from China and Taiwan, and up to 60% off retail price
shipping and customs processes.
branded products from the USA, under this category.

Report Southeast Asia Cross~Border E~Cornmerce Market Mordor into!!it)encs

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 ( 145)

ezbuy is a significant platform for the Southeast Asian customers and the Chinese sellers through its buy-for-me service. ezbuy partnered with Taobao to avail
the wide range Chinese seller portfolio and their products to the local customers. But local e-commerce site ezbuy has stopped offering its Buy-For-Me
services with Chinese e-commerce giant Taobao temporarily in December, 2017.
For more than a month, the company had found it difficult to deliver the Taobao orders, which clients here had placed over its platform. Shoppers here who
had used ezbuy's services would either have to shop directly on Taobao, find a new agent to buy on Taobao or switch to the other retailers with whom ezbuy
still had dealings.
ezbuy continued running its Buy-For-Me services from other countries such as Japan, South Korea, and the United States, with the China services for Taobao
rerouted to other popular Chinese e-commerce sites, such as JD.com (Jing Dong) and Mogujie.

The comp2n~' was mvolved in a war cf words vvith Taobao's parent, the Alibaba group, after it accused the Chinese g1ant of bul!ying a small player. Taobao
retorted by labeling ezbuy's act of creating accounts to buy items from Taobao and reselling them cs "scalping." The conflict led to a nlassive backlog of orders
p:aced en ezbuy for Taobao purchases that vvcre: of the Singles day, the largest online event of Chine, that has spread to other /\sicn countries

as well.
To recover from the episode, it announced that it had plans to double its number of product offerings, by bringing onboard "more than 10,000 sellers" to list on
Gzbuy.sg. These sellers are expected to contribute to on 2dditiona.l three million products on top of the existing four mi!lion products available. It is also vvorking

on extending its reach to other popular e-commerce websites, such as beibei.com, which specializes in infant and mother prod-ucts .

•. : • Later, the ezbuy's buy-for-me services with Taobao has resumed and back to normal. This incident highlights a risk that sites, like ezbuy face, being dependent i

on foreign marketplaces that might cut them off and disrupt its business. That could be especially concerning in the case of marketplaces, like Taobao, that !

can reach people through Lazada in Southeast Asia, which was acquired by Alibaba.

Report Southeast Asia Cross-Border E~Commerce Market

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9.6 ( 146)

According to industry sources, eBay- the popular e-commerce platform from California, is the third most visited e-commerce site in Singapore in the 01 of 2018.
ezbuy follows it by taking the fourth place. During the 03 and 04, 2017, ezbuy was the third most visited site and eBay placed fourth. However, eBay overtook ezbuy
during the 01 of 2018, and both platforms switch their ran kings between each other. ezbuy and eBay share one significant similanty, in which most of the products
they sen are mainly from overseas.

Ezbuy raised USD 17.6 million in latest funding, which eyes more reliable
modes o~ bc3.iized se:-vices. The round of Pre~Series C funding '·Has co-lscl by
several venture capitalist firms, including IDG, Vente-ch, Sky9. VKC, and CGC.
ln addition to dfering rnore reliable rnodes of Jocaiized services to custorners,
the funding is aiso expected to be used to expand the company withir; and

outside of Southeast Asia_ .

Mar2018

0
Merger and Product Expansion Partnership
Acquisition Innovation

Report Southeast Asla Cross~Border E-Commerce Market

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9.7VCANBUY ( 147)

In 2011, three Chinese and Thai partners founded Vcanbuy. The parent company of Vcanbuy is a CTW, a Sino-Thai
logistics company with a history of more than ten years, providing transportation and customs declaration for large-scale
Chinese and Thai enterprises. Integrated logistics services, including customs clearance and warehousing.

Vcanbuy.com is Thailand's online buying platform provider. The company's services include purchasing, payment, and
logistics where the customers can easily buy the Chinese products through the easy, fast, secure, and reliable online
platform.

Vcanbuy has become Thailand's largest B2B purchasing platform, with more than 150,000 users and more than 3 million
imported goods oer month. 55% of orders on the platform come from 1688, and the remaining 45% come from other retail

platforms, such as Taobao and Tmall. Founded in 2011

Nakhon Pathom, Thailand

V>Nvw.vcanbuy.com

/ ....•• ·.·.@
'""'. ~
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. ·. ·.
~,,
.El¢~.a

Report Southeast Asia Cross~Border E~Commerce Market Mordor intd!igenco

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 ( 148)

Vcanbuy is a major ecommerce player in Thailand It contributes to high volumes of cross border ecommerce trade between Thailand and China.

Vcanbuy provides the information of ecommerce retailers from China to Thailand-based consumers. The company provides additional services, like payment

options. warehouse condition information, warehouse management system, and support for major Chinese ecommerce players.

Vcanbuy is placed in the Southeast Asia Cross-border ec0mmerce m<:J.rket as a p,layer that specializes lnto imparting products from China. Ecommerce activities
relating to import of goods from the Chinese marketplaces is the company's specialty.

Chinese marketplaces are actively investing to increase their cross-border ecommerce business with the Southeast Asia_ With the estimation of strong grovvth of
ecc;~-;rr,erce in the Southeast Asia ar,d highly fE,vorabtc demographics, it is expected that the company is e>:pe<:.ted ;_o be one of the piasers wher,

dealing with Chinese imports.

Report Southeast Asia Cross-Border E~Commerce Market Mordor inte''igenco

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9.8 ETSY ( 149)

Our marketplace connected 1.9 million creative entrepreneurs with 33.4 million thoughtful consumers looking for items
made by real.

Seller services and tools help Etsy sellers start, manage, and scale its businesses.

Etsy's six core geographic markets are the United States, United Kingdom, Canada, Australia, France, and Germany, and
there are people using the platform to buy and sell in nearly every country in the world.

The Etsy marketplace enables the millions of Etsy sellers and buyers to smoothly transact across borders, languages, and
Founded in 2005
devices.

Ets{s impact strategy focuses on leveraging Etsy's core business to generate value for our community and stakeholders
New York, United States
through positive economic, social, and environmental efforts.

'v\/\/Wl.etsy.com

441.00

2015 2016 2017

Report Southeast Asia Cross~Border E~Commerce Market

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9.8 ( 150)

2ifi

;-,

'2 ;v;,

Urded

Sr;;!ler s~~"J'te'::

59%-

The revenue from marketplace segment increased from USD 158.2 million in
the year 2016- USD 179.5 million in the year 2017. The reason for the growth of
USD 317.755 million revenue was generated from the United States accounting
the segment is attributed to the increasing geographic reach of the company
to 72% of the company revenue in the year 2017.
and rising user base~
While the international e-commerce generated USD 123.476 million accounting
On the other hand, revenue from Seller Services segment also grew from USD
to 28% of the company revenue in the year 2017.
200.85 million in 2016 - USD 285.45 million in 2017, due to high services
The revenue from both the geographic segments observed growth in the past
provided by the company to the sellers and the increasing preference of Etsy as
years.
a selling platform.

Report Southeast Asia Cross~Border E~Commerce Market Mordor l::teHigonce

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 <151)
Etsy is an international player with major presence in Singapore and Philippines, The products provided by the company are unique and highly appealing to the
audience in the Southeast Asia.

With the company having a strong supply chain originating from the United Ststes, the company has the ability to improve its market presence in Southeast
Asia.

Etsy has a high competition in the Southeast Asia region from the local players. With a highly fragmented market and the estimation of market growth, there is a
high scope for the company to expand market share in this region.

Report Southeast Asia Cross-Border E-Commerce Market Mordor lntc!Hgence

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 ( 152) ::

Fado.vn is the leading cross-border e-commerce platform in Vietnam. The company is the pioneer in helping Vietnamese
people in trading goods around the world, easily and without distances. With four year experience in the industry, Fado.vn
provides the full customer centric experience with our shopping platform that has been tailored to meet the local market
needs.
Fado.vn aiso expanded its network to support high quality Vietnamese products entering the US market through the

delivery of high quality products. The 1nternat1onal service Amazon.com, expanding the way of exporting Vietnamese
goods around the world.
Cvery single product ancl sale promotions information from major ,~mazon stores i:1 the United States, Germany, Japan, as

weli as E-bay and other online shopping websites is being updated constantly that gives customers the shopping
HCM, Vietnam
experience not found in any competitor.

As a result. Vietnamese businesses are confident in the quality of their products. From this. they have the choice of
fado.vn
reliable, simple, and fast way to go straight to the world's most demanding markets through the vvings.
Fado.vn is a member of Miczone corporation. As a cross-border e-commerce platform in Vietnam, Fado.vn has become
the pioneer 1n helping Vietnamese consumer's in trading goods around the world, easily and without distance.
The system automatically calculates shipping costs and import tariffs to help customers know the whole package cost
instantly.
Not only providing international quality products from Amazon, Fado.vn also expanded its activities, by creating a support
network of high-quality products. It entered the United States market through Amazon, opened the roads for Vietnamese
exporters, worldwide.

Report Southeast Asia Cross-Border E-Commerce Market Mordor lr.to :~gence

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 FADO ( 153)

Fado Vietnam is a specialized e-commerce player for the Vietnam consumers. Currently, Fado.vn acts as a listing e-commerce site where products from major e-
commerce sites, like Amazin and Ebay from preeminent countries, like the United States and Germany are listed and available for purchase.

With strong growth of the market estimated during the forecasted period it is possible for Fado. vn to expand their services to neighboring countries.

Fado.vn is still a medium scale enterprise focusing only on Vietnam market The company has a major opportunity to expand in Singapore and Malaysia
markets.

Fado.vn 1s becoming an important strategic partner of

Arnazon.com in the United States to connect and open
shopping paradise without borders fo.r Vietnamese consurners.

f'.lov2017
L_ __________________________________~

G
Mergers and Product Expansion Partnership
Acquisition Innovation

Report Southeast Asia Cross~ Border E~Commerce Market

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 ( 154

SGshop was conceived with the dream of bringing cost effective parcel delivery to the masses. This simple idea
flourished, and quickly grew to be Singapore's Leading Parcel Forwarder, providing a simple, reliable way to shop
and ship from China and the United States.

Founded in August 2011, SGshop is Singapore's trusted logistics partner, helping shoppers ship their purchases to
and fro China.

SGshop Ecommerce Sdn Bhd is a Johor-based cross-border e-commerce company founded in 2015 SGshop is a
one-stop online shopping ser\iice for r/:alays!sn sh:::;.;;pas u-.2t provi.::::~es produc: qualrt':' control 2nC cssu;ance,

de!ivecy insurance and responsive customer cqre to ensuro a satisfactory, and hassle-fr-o:;.:; shopping exper:ence.

Through SGshop, customers can source trusted products from overseas online marketplaces (specificaily from Founded in 2015
Taobao China at this stage).
Crocodile House,Singapore

www.sgshop.com

Report Southeast Asia Cross~Border E~Commerce Market

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 0 SGSHOP ( 155)

Sgshop is a prominent players in Singapore and Malaysia where it has major operations as a parcel forwarder. The company has access to major Chinese
marketplaces and allows for international shipping.

The company is already expanding its presence across the Southeast Asia region and it is expected that the company may hold a significant market share, during
the forecasted period.

Focusing on Chinese marketplaces, the company has a strong growth prospects, as the Chinese activities are increasing when concerning to the shipping to
Southeast Asia countries.

SGSHOP, a Johor-based onl1ne quality assured cross-border

shopping site, has launched its inaugural equity crowdfunding (E.CF)
campaigr: to :-aise USO 121,866 (Pf\.~500,000) through .AJa Pius, a
registered ECF operator. Pla:--1s are in place for SGshop to expand its

n1arket reach beyond Malaysia to tap into the Asean market

Aug2018
I -------
1 SGshop Malaysia today officially launched the opening of the iF office
located at Medini 6, in Medini City the central business district of
Iskandar Puteri.
Dec 2017 Merger and Product Expansion Partnership
Acquisition Innovation

Report Southeast Asia Cross~Border E~Commerce Market Mordor Intelligence

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 ( 156

WeShop is the premier cross-border retail import-buying facilitation brand in Southeast Asia.

Unlike other cross-border shipping facilitation services, WeShop provides a full-cycle (from A to Z) cross-border retail
shopping experience: global sourcing, local marketing, local payment, global logistics, local logistics and customer
supports to end-buyers with a comprehensive and innovative import-buying facilitation process.

Currently the company has subsidiaries and joint ventures in Southeast Asian countries, operating !ocal portals in
';",',);ld'.'lidce-Shopping i'fictde
Malaysia, Indonesia, Singapore, Philippines, Vietnam, and Thailand

!n Oclober 20i 6, Vietnanl-baseci tech group ~,)extTech Grcup of Technopreneurs ar,d ~.~1alaysiz<'s Has pro Ho\dings have

jointly provided a US seven-digit fund,;ng for WeShop Indonesia and an undisclosed amount !"or its parent firm We Shop
Global Group to bring the cross-border e-commerce pfatform i-r1to Vietnam and Malaysia. Founded in 2014

After this investment, WeShop has become a unit under the Next Tech's ecosystem of digitized platforms.
Hong Leong Building, Singapore

weshop.asia/

Weshop Vietnam Electronic Commerce Joint Stock Company Weshop Global Philippines Inc.

VND 15,948.10 million(2017) VND 57.72 million(2018)

Report Southeast Asia Cross~Border E~Commerce- Market Mordor lnteiligcn:.:o
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 <157)
WeShop is an exclusively import facility provider for the Southeast Asia countries. The company is involved in expansion into the Middle East and Oceanic
markets.

The company has a major focus on the United States, China, and Japan market places and provides end-to-end services from these market to the Southeast
Asia countries.

The company has a large presence in the Southeast Asia countries and plans to further improve its market presence by expanding into other regional countries.

Looking at the companies active participation into the Southeast Asia market and expansion plans in the international markets, the company is on the track for
strong future growth.

VeriME, a Singapore-based blockchain decentralized c'igi:al

identity verification platfor·m, ar.nounced on Friday that it has

formed a partnership with cross-border retail import-buy

facilitation brand VIleS hop to provide secure customer verification
and authentication services.
Merger and Product Expanslon Partnership
Dec 2017 Acquisition Innovation

Report Southeast Asia Cross-Border E~Commerce Market Mordor lntei!igcn::;c

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9.12 ( 158)

Shopee is the leading e-commerce platform in Southeast Asia and Taiwan.

It is a platform tailored for the region, providing customers with an easy, secure, and fast online shopping experience
through strong payment and logistical support.

Shopee aims to continually enhance its platform and become the region's e-commerce destination of choice via ongoing
product optimization and localized user-centered strategies.

Shopee, a Sea company, was first launched in Singapore in 2015. and expanded its reach to Malaysia, Thailand, Taiwan,
indonesia, Vietnam, and the Philippines

Sea is a leader in digital entertainment, e-commerce, and digital financial services across Greater SoutheasT ,D,sia. Its
mission is to better the lives of consumers and srnail businesses with technology, and is listed on the i'IYSE under the Founded in 2015
symbol SE.
Singapore
The Shopee team comprises over 7,000 employees from across the region, and with its rapid expansion, they are
constantly on the lookout for potential young talents, who have the passion and drive to become part of a fast-moving and
shopee.com/
dynamic team.

Report Southeast Asia Cros%H3order E-Commerce Market Mordor lntu.iige ~co

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 2
<159 ·-
:::::

Shopee e-commerce platform is benefiting from high demand for China-sold products by the launch of its new China Marketplace.

Singapore users likely to be capable to order goods from Chinese sellers through the portal, without any shipping and agent fees.

With product categories, like women's fashion, home and living and kids' fashion, the novel feature is similar to Lazada's Taobao collection option, where
Singapore shoppers can order goods from Taobao sellers through the Lazada website.

With the launch of its China Marketplace, Shopee is hoping to beat the competition by addressing these common pain points.

Shopee marked a milestone of 25 million downloads and more than 65 million product listings across the seven markets it serves. Shopee Thailand has achieved
more than 5 million downloads. Thailand is a key market given the strong mobile penetration and massive potential.

Shopee Thailand is foCL:sing on the expansion of market segments, including improving its product portfolio by adding more categories and bringing on boad

more official shops to increase product variety for buyers.

Shopee ·rnailand has launched a nevv in-app shop, Shopee For fVren. The shop is a one-stop porial for male shoppers to access more than 20,000 products from
!!lore F·1an 300 r-etailer-s, inc!u(ing to:J bra:Jc's, such as Asus, Gosch, and Conve~·se_ Shopee msy run super men's day on the 23rd oi ever)r month. 7eaturing

speci2l dea!s and f!csl' s;Js~. Uil r;·~en's _t;rcducts. Shop-ee r:or r"'1·er: nlay cl.so provide ;:,em-interest insta.:rnsr-1ts on selected electronics, sporis. anc' Jife:::.ty:e

items.

Over the past three years since sta1iing the businesses in Thailand, Shopee has more than 23 millions down loaders in Thailand, more than 800,000 online shops

and over 1, 000 leading brands.

The success of Shopee was derived from the hyper localized marketing, an ecosystem that supports cash payment upon receiving the products and the
collaboration with various transport companies. Shopee may continue providing free delivery to customers and commission-free for shop owners who do
businesses on its platform.

Report Southeast Asia Cross~Border E~Commerce Market Mordor l•1tclligcnce

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 9.12 ~HOPFF ( 160)

Shopee has signed an official exclusive partnership wrth Honor for

its launch in the Philippines. The partnership may allow around 11
million Shopee users in the Philippines to purchase the Honor 9
Lite, Hono!"'s first quad-camera smartphone exclusively on Shopee
on May 5, as part of the 5.5 Shopee Super Sale.
May 2018

":--_I
' - Ramping up its presence in the soutl:east P-5ian markets, DHL e-
commerce has forged a. oartr;ership with Shopee Malaysia to
extend its next-day delivery service follovving a similar deal with

Shopee Thailand.
Shopee, Southeast Asia and Taiwan's e-commerce platform, has Apr2018
partnered with Nanyang Polytechnic's Singapore Institute of Retail
Studies (SIRS), to offer full-day e-commerce workshops.
Consisting of an on-boarding session and a marketing session, the
workshops aims to provide participants with the necessary support 0
to grow their businesses. Merger and Product Expansion Partnership
Acquisition Innovation
Jun 2018

Report Southeast Asia Cross-Border E~Commerce Market Mordor lnte!!igencc

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 (161)

Giosis Pte Ltd was incorporated in 201 0 and is based in Singapore.

Qoo1 0 was founded as a subsidiary of Qoo1 0 Pvt. Ltd, in 2010 by Giosis Pvt. Ltd, a joint venture between Gmarket
founder Ku Young Bae and eBay. Giosis Pte Ltd(Qoo10 Pte. Ltd.) operates an online marketplace platform for shopping in
Singapore and Japan. Ooo1 0 is a Southeast Asian e-commerce platform, fonmerly known as Gmarket. The company is
headquartered in Singapore.

The company operates localized online marketplaces in Singapore, Indonesia, Malaysia, China, and Hong Kong, and on

international online marketplace.

The company offers fashion and clothing, such as women's and men's clothing, bags/shoes, jewelry/watches, and fashion

accessories, beauty and sports products. including cosmetics, body care and diet products, and sports/outdoor products,
Founded in 2010
and digital and mobile products comprising computers/laptops, TV/appliances, home electronics, cameras/camcorders,
and MP3/mobiie/e-book products, among others. Singapore

Ooo1 0 is a E2C ar.d C2C marketplace platform end accepts payment v:a credit card, bank transfer, PayPal, its own

currency called C:.-Mcr;cy, \Nhile offering escrow service for its C2C ntercnants www.qcoi O_sg

Qoo1 0 offers a lot of ways to buy its products, including daily deals, group buying, auctions, and Lucky Lounge. The latter
is a feature, in which users, who win a lottery drawing can buy a specific product at a low price. Each lottery submission

costs one stamp, which can be earned by shopping or playing games on Qoo1 0.

The site looks a bit cluttery, but it seems Indonesians and Singaporeans like it.

Report Southeast Asia CrossmBorder E~Commerce Market

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Oi ' " " ' " ' ' " ' ' ' ' " '
 ( 162)

Qoo10 is cooperating with Indonesia's Ministry of Small and Medium Enterprises and Cooperatives (MSMEC) to support the OVOP (One Village One Product)

program. The OVOP project helps indrviduals and SMEs from underdeveloped regions in Indonesia by training them on how to strengthen businesses using
Qoo1 O's online platform.

The products likely to be sold locally and internationa!ly by Qoo1 0 Sellers from villages only need to deliver the products to Ooo1 O's warehouse on product
demand, and Qoo1 0 may do the rest. One percent of total OVOP product sales likely to be donated to fvlSMEC.

Qoo1 0 has completed its set-up phase and is now ready to take the leap to the next stage, which includes building a platform for a multi-country marketplace,
building the management teams in the six countrie!';l it is present in, crP.ating strong infrastructure for cross border fulfilment secvice and backend support
serv1ces.

To differentiate itseiffrom the competition, Qoo10 focuses on supporting local merchants.

Qoo1 0 expects to scale up further with the intentron of conducting an initial public offering by 2019 and becoming a SGD 10 billion company by 2021.

Qoo1 0 is a major player in the Singapore Ecommerce market. The company plans to create an open platform for ecommerce in the Southeast Asia region.

The company plans to JPO in the year 2019. The growth prospects for the company are vast in the Southeast Asia region. With the backing of e-Bay it is
expected that the cross-border e-commerce revenue for the company may increase.

e-Bay's vast experience is expected to be an advantage for the company's further expansion into the Southeast Asia region.

With approximately 3 million registered users Ooo1 0 is expected to be one of the major players in the Southeast Asia e-commerce business with a strong growth
in the forecasted period.

Report Southeast Asia- Cross-Border E-Commerce Market Mordor !r:toiiigence

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 ( 163)

Bank of China Singapore Branch (BOCSG) launched a co-brand

Mastercard credit card with Singapore's largest online retailer Qoo1 0.
This marks the first-ever partnership between a bank and e-retailer
locally. The new card, which caters to both working adults and students,
aims to bring greater value to online shoppers and drive e-commerce
grow1h in the region.
A Memorandum of Understanding (MoU) signed between Giosis May 2018
Pte Ud (Qoo1 0) and Nanyang Polytechnic's Singapore institute

of Retail Studies (SIRS) to help SMEs fully max1m12e

ooportuni:ies in cr:l!ne marketplace
The Qoo1Q .. S!Rs programme supports local companies with
resources tc· achieve ci:gital :ransfo,·-mat:ons and siay rele\12i_IJ~

through a series of specially-curated training workshops.

Nov 2017 Merger and Product Expansion Partnership
Acquisition fnnovation

Report Southeast Asia Cross~Sorder EnCommerce Market

"''"'"·''"''''H"•b<-«<"~''"·"'""-"-"'~'"'"''"'""''""~'""-·'"''-""""""""''"'"'""'"'"''""""''"-
 ( 164) ::

The online shopping marketplace Rakuten Shopping Mall was officially launched on May 1, 1997. The company had 6
employees and the website had 13 merchants. The name was changed to Rakuten in June 1999. The Japanese word
"rakuten" means "optimism".

The company went public through an IPO on the JASDAO market on April 19, 2000. At the time, the online marketplace
had 2,300 stores and 95 million page views per month, making it one of the most popular sites in Japan.

Around 2011, Rakuten started heavily expanding outside of Japan, which includes launch of Indonesia's Rakuten Belanja
On~ine. By !ate 2812. Rakute:-~ hacJ (rovc=:G into online retail in t-\us:ric:. C2nc:da, Sqa:n, iaiv.J2r~. anG Thailand. r:ounded in 1997

in 2016, Rakuten shut down retailing we8si·tes in the United Kingdom, Spai.:, Austria, Sing2.pore, Indonesia, and 0·iiaiaysia.
Setagaya, Tokyo, Japan
The Rakuten Group consists in total of around 70 businesses and services in addition to its online marketplace, including
online shopping, banking, credi~ card and payments, media, travel reservations, professional sports, video on demand,
global.rakuten.com
marketing and data analysis, e-reaaing, book distribution, fashton and mobile messaging.

944.47

781.92

2015 2016 2017

Report Southeast Asia Cross-Border E-Commerce Market

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 ( 165)

There has been a rapid growth in the GMS of Ebates, which operates an online membership-based cash-back site, primarily in the United States. In fiscal 2017, its
GMS increased by 47.2% year-on-year to approximately YEN 1 trillion (USD 9.7 billion). Its operating income was 24.1% higher at US$64 million.

Rakuten becomes a major competition to Southeast Asia-based ecommerce companies, in terms of cross border business. The United States is a major focus for
the Southeast Asia-based ecommerce companies and also holds an important strategic place for the cross border market. Rakuten is making leaps and bound
advancements in the United States market.

Rakuten has been expanding aggressively in the United States market and this has led to its rapid development in the country.

In January 2018, Rakuten and Wai-Mart Stores Inc. (Walmart) announced a strategic alliance in Japan and the United States. As part of this alliance, the two
companies may establish a nevv company, which may jointly operate Rakuten Seiyu Netsuper with Seiyu GK, a Walmart subsidiary in Japan.

The new business may start in the third-quarter of fiscal 2018. In the United States, Walmarfs brickand-mol1ar stores and Walmart.com may commence exclusive

sales of e-books, audio books, e-book readers, and other items supplied by Rakuten Kobo. Rakuten and Walmart are among the world's leading e-commerce and
retailing companies. They may use their respective strengths to create innovative service and expand their business operations in the Japanese and US markets.

! i' Ra.k:uten is no-;- c;Jera: 1'19 ~~~ ~he Sol_;lheos·l ,£:;.,sic: ·na;kc.L. It is expscterl 'lh2t \NiU··, the ex;:::ec:'.-20 cf th-2 Southeast Asia cross-bon-ier ""--

cm-nmerce market in the forecasted perioci the Japanese ecommerce giant may re-enter the market.

Thus, it becomes important to consider Rakuten as a maJor player in the market, as it can disrupt the market in the forecasted period.

The Rakuten Group consists in total of around 70 businesses and services in addition to its online marketplace, Including online shopping, banking, credit card and
payments., media, travel reservations, professional sports, video on demand, marketing and data analysis, e-reading, book distribution, fashion, and mobile
messaging

Report Southeast Asia Cross-Border E-Commerce Market

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~

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10. ( 167)

As the rapid growth of e-commerce is observed, the demand for proper logistics and fulfilment solutions has been increased rapidly, Most of the global logistics
companies play a significant role in bringing the orders made by the Southeast people in the international platform. But, logistics is a crucial challenge for the
growth of cross-border e-commerce in the region.
There are many issues that companies face in logistics. Indonesia and Philippines being archipelagos have unique problems in logistics, as road transport is not
possible in many areas. Poor infrastructure, particularly outside of Singapore and Malaysia, which is restricting foreign in setting up their businesses. Severe

traffic issues in some of the major cities, such as Bangkok and Jakarta affecting last mile delivery.
For instance, DHL e·cornmerce, bunched January 2016 in Thailand, offers end-to-end domestic delivery services and easy access for local businesses to

expand glcbal:y through affordable 82C international cross-border shippirlg and scalable, pay-per-use fulfilment solutions through a global fulfilment network
withm Deutsche Post DHL Group. There are many e-commerce enablers, who provide var~ous servrces, lrke fulfilment, marketing and management services,
web development etc.

Globat 5-ourcinq & Cross Bord-er Solution

EXPRESS
Report Southeast Asia Cross~Border E-Commerce Market Mordor lnto:-igo·'c:c
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10. COMPANI ( 168)

Payment plays a crucial role in cross-border purchases. Most of the people in the Southeast Asian region are still depending on the cash-
an-delivery (COD) service. Hence, there is a vast opportunity for the payment solution providers to position themselves in the booming
market.
According to a recent study by PayPal, It IS revealed that the dig1tal upheaval brought about by social media and increased smartphone
penetration translate to increased opportunities for cross-border trade, as seen by the projected growth in online spending. The world has

become rnuch smaller 0s platforms, like P:::;:;Pal sne.~le lne:r"chants ~u take advantag~ of :Jppor·~unities by f.~:ern ·vv;til g!obc:-.i
consumers, allowing SiVIEs and micro enterprises more opportunities to thrive. For Philippines merchants to take full advantage of the
expected increase in online spend, they need to address these barriers to encourage overseas purchases. PayPal allows and connects to

international consumers via a secure, seamless, and hassle--free ne~work_

A!ipay platform penetrates eight Southeast Asian countries. Southeast ,L\sia has alvvays been a popular Gestination for Ch1nese tourists. In

2017, more than two million Chinese tourists visited Cambodia, Burma, Laos, and the Philippines. Alipay has facilitated shopping, dining,
entertainment, and hotel transactions in these countries.

EasyPa II t pay ~fiJ~

All, PAY
Payment Gateway
Report Southeast Asia Cross-Border E~Commerce Market Mordor irtciiige;1ce
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10. OTHER COMPANI ( 169)

Technology aids the e-commerce market in every phase of the supply chain. The adoption of new technology is essential in the fields of payments and customer
experience to promote cross-border e-commerce in the region. Since most of the people still depend on cash-an-delivery methods, payment solutions are
looking for innovative solutions to make the cross-border transactions easier.
Additionally, the customer experience plays a significant role in lever3ging cross-border purchases. The presence of an e-commerce website on multiple

countries makes the providers focus on language and prices, which are acceptable by the locals. Deployment of advanced software and tools are aiding thee-
commerce platforms in increasing their monthly visits and there by purchases.
Furthermore, digital marketing reduces the gap between the customer and a seller platform. Since the internet is penetrating at a rapid pace, companies are

Spenditlg heavily on online advertisements and other marketing 'techniques.

Crit·co, a leading commc:-cc marke:ing technology company announced tr.at its proprietary technology has helped Sendo.vn, a leading Vietnamese commerce
marketplace to better support merchants on its platform and engage shoppers with relevant and personalized experiences. Sendo.vn has been working with

Criteo since May 20'1 /. Thc:<r on-going collaborat;on has resulted in a 578 per·cerlt increase !n web and app commerce revenue, and a 440 percent increase in

to:a: conversion for V•Jeb and app.

cr1teo •
Report Southeast Asia Cross~Border E~Commerce Market Mordor Intelligence
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 (171)!E

GDP SectcJr, Singapore, 2017 GOP By Sector, i~tn;::tm_ 2017

(';' l

~~;,:' '""'n 06.0[.>;;)

Report Southeast Asia Cross-Border E~Commerce Market Mordor intelligence

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11.1 <172)

Th8Jh-;r;d

Trade {wholesale retail including Trade (vvholesak;. ircluding

.;:: ;:_ (~('"·:,

Trade {wholesale, retail ir-C!dding mTrade (wholesale. inclucl :1g

export import activities) export and irncort activities)

Others Others
82,00%

Report Southeast Asia Cross~Border E~Commerce Market Mordor liltoiHgerJuJ

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11 ( 173) ::

E-Commerce Merrkt8! as a share of retail By 2016

TicC'ilU1d 4.30 Thailand

Singapore 2.92 Singapore 5.3

f-/la~aysia 2.48 Malaysia 5

\fietnc_m 2..32 Vietnam

Philippines 1.94 Philippines >1

Indonesia 6.87 indonesia 2.2

Report Southeast Asia Cross-Border E~Commerce Market Mordor intsl!igcncc

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 ~2 ;:, ALl::;:, (174)l:i:

Alibaba Group Chinese Marketplace RMB bn 3,092 3,767 4,820

- TaoJco· iV1arketpl;3ce- Chinese i'v12.rke'cp!3ce Ri\.:18 b,~: :1,8't7 ')

,__LUL
~ ,r.<")
2,689

Tmall Chinese Marketplace RrvJB bn 1,215 1,565 2.131

Lazed a SEA USD bn 1.30

Amazon Globai USD bn 226

eBay Glo~al USD bn 81.3 83.49 88.4

JD.com Global RMB bn 591 939 1,29t50

ezb~y SEA USD mn 500+

Shopee SEA+ Taiwan USD bn 1.15 5

QogjO s$ U$Dmn
' 8.00

Rakuten (Japan GMV) Global JPYtn 2.7 3 3.4

Report Southeast Asia Cross·Border E~Commerce Market Mordor lntelliqo-:cs

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11 ( 175)

INDONESIA PHILIPPINES THAILAND

Lc.:::::,da :·' ~'~!·:J,/00 Laz3da 30,015,200 Lazada TH 39,721,400

JDID 11,269,000 Shopee 8,460,900 11 StreetTH 1,385,300

Zalora 3,841,100 Zalora 1,693,000 Looksi 468,300

Sophie Paris 3,226,100 Sephora 118,300 Orami 204,800

Ali Express 2,118,700 Sophie Paris 18,649 Sephora 193.700

Qoo10 9,971,600 Lazada 27,990,500 Lazada VN 32,711,291

Singsale 354,300 !1 Street 6,437,600 Lotte 1,784,493

Amazon 205,000 Zalora 1,817,200 Yes 24 1 '119,989

SHOP. com 87,800 Qoo1o 929.700 Robins 586,223

l)suy J3Q,400 ezBuy 52(l,700

Report Asia Cross~Border E~Commerce Market

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 ( 176)

China 1.756 3.975 8.919 31.01%

Japan 1.026 2.281 5.029 30.25%

us 0.721 1 742 4.172 33.38%

South Korea 0.520 1.297 3.204 35.29%

ASEAN 34.12%

Others 1.890 4.414 10.177 32.28%

Report Southeast Asia Cross~Border E~Commerce Market Mordor :-,~onigcnce

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11.4

Zero rated SllDplies,

2-!-:iFc -,·:?S ',if-\T 12% No Yes
:----v~T::"-: ·2:_,pplies

Zero rated supplies,

Thailand VAT 7% Yes Yes
exempt supplies

Ze1·o rateJ supplies,

Singapore GST 7% Yes Yes
exempt supplies

Zero reted sur)piies,

Vietnan1 Vi\T 10% exempt supplies, Yes Yes

Reduced Rates

Zero rated supplies,

Malaysia GST 6% Yes Yes
exempt supplies

Zero rated supplies,

Indonesia VAT 10% No Yes
exempt supplies

Report Southeast Asia Cross~Border E~Commerce Market Mordor lntc:.iqo-'108

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 CUSTOM RESEARCH SERVICES
Over the years we've seen that the ability to customise our syndicated reports is an option most of our
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