Indonesian e-commercer firm Bukalapak said Thursday that the firm has decided to gradually discontinue physical product sales on the Bukalapak platform, starting in February 2025.

The firm said in a statement that this move is part of its new strategy as to focus on virtual products.

It said the firm wants to emphasize that this change is a necessary step to focus on business lines with higher growth potential that it has been developing.

“Although there are changes in product focus, we assure you that the Bukalapak marketplace platform, including its app, website, and Mitra Bukalapak services, will remain operational and accessible to users and customers for other existing services,” it said.

This official statement is in response to widespread reports regarding the closure of Bukalapak marketplace.

With Bukalapak marketplace continuing operations, Bukalapak said it is not altering its business activities.

Moreover, it said the discontinuation of physical product sales on the Bukalapak marketplace platform does not have a material impact on the company’s revenue.

It noted that physical product sales contribute less than 3 percent to the company’s total revenue.

“On the contrary, this move supports our efforts to achieve positive earnings before interest, taxes, depreciation, and amortization (EBITDA) and ensure a healthy and profitable business sustainability,” it said.

The firm also believes that by focusing on virtual product services, Bukalapak can strengthen its position in the digital ecosystem and provide the best services to users.

This move is part of the company’s long-term strategy to remain relevant and competitive in the industry.

In addition to focusing on virtual products, Bukalapak has also developed various new business lines such as Mitra Bukalapak, gaming, investment, and retail over the past few years.

“We see positive business prospects in these segments, which are also part of the company’s growth strategy,” said the firm.

Bukalapak also highlighted that the firm has evolved from a marketplace into an e-commerce platform that facilitates numerous businesses through continuous innovation and development.

Since 2021, the firm has been undergoing a transformation to expand into virtual products, gaming, retail, investment, and Mitra Bukalapak services.

“Changes in market dynamics and competition within the industry have prompted us to adjust our long-term strategy to ensure the company’s sustainability and relevance in the future,

“This plan was transparently disclosed through an Information Disclosure announcement at the end of October 2024,” it said.

Bukalapak also emphasizes that the firm maintains a solid financial position with strong cash reserves.

According to the third quarter 2024 financial report, Bukalapak recorded cash, cash equivalents, and liquid investments of IDR 19 trillion ($1.17 billion).

These funds will be used to support the growth of the company and its subsidiaries, thereby delivering optimal benefits to stakeholders, especially shareholders.

Bukalapak said the firm is also committed to supporting sellers in adapting to this change.

“We are providing various guides and resources to help sellers ensure a smooth and secure transition,

“We also value the trust that customers have placed over the years and will ensure that customer rights are upheld until the end of the transition process,” it said.

Indonesia e-commerce firm Bukalapak to stop selling physical goods – report