TikTok Shop Is Considered To Be The Cause Of The Tanah Abang Quiet Market, Head Of The E-Commerce Association: Not

Illustration (Photo: Doc. Antara)

JAKARTA - Chairman of the Indonesian E-commerce Association (IDEA) Ignatius Untung opened his voice regarding the TikTok Shop platform which is considered sluggish in trading MSMEs, especially at Tanah Abang Market, Jakarta.

Ignatius assessed that he did not see strong reasons that the platform had competed with MSMEs directly.

"TikTok Shop is, right, a platform that does not compete with MSMEs. So, whether the position on TikTok Shop is successful and becomes big, who are they? Yes, one of them is MSMEs, there are also many MSMEs who also (the business is successful) from there. So, if you say TikTok Shop makes MSMEs sluggish, not really," he told VOI, Monday, September 25.

According to him, one of the factors that affect the sluggish trade in Tanah Abang is the competition among MSMEs itself.

"Actually (the loss of MSME trading) is not because of TikTok Shop, but because there are other MSMEs that are smarter using TikTok Shop, so this is a matter of competition between traders who use TikTok Shop against traders who do not use TikTok Shop, not between MSME traders and TikTok Shop," said Ignatius.

Because, he continued, there is a difference in the structure between MSME traders and TikTok Shop itself. TikTok Shop is a platform, while MSMEs are traders who sell products.

"TikTok Shop, kan, platform, mereka enggak punya produk, yang punya produk itu pedagang. Jadi secara logic, nggak mungkin TikTok Shop yang berupanya itu marketplace bersaing secara langsung dengan pedagang, karena kalau berupanya marketplace itu tidak akan pernah berani bersaing sama pedagang," ucap dia.

He views that TikTok Shop can only be a big platform because it lives on merchants selling their products through the platform.

So it is very unlikely that TikTok Shop will compete with MSME traders.

"They (TikTok Shop) are big from traders, if they compete with traders, all the traders will run and when the traders run away, then after that they can't live, so they can only grow when the MSMEs who use their platform become big," said Ignatius.

"Indeed, there are traders who are more sluggish, but not because of TikTok Shop, this is because there are other traders who use TikTok Shop, while they (the others) don't," he added.

Therefore, he asked the government not to misinterpret this.

"The government is asked not to make the wrong accusation. Well, unfortunately that's what the government sees, it doesn't know where the government gets the whispers from, how come it's as if the TikTok Shop is dealing with MSMEs, but it's not. In terms of market structure, it's different, TikTok Shop doesn't deal with MSME traders, it actually helps MSMEs to be able to trade better," he said.

As previously reported, a number of traders at Tanah Abang Market, Jakarta, complained about their declining sales recently.

They also protested and asked the government to close the TikTok Shop.

This was revealed by them to the Minister of Cooperatives and SMEs (Menkop UKM) Teten Masduki during a visit to Tanah Abang Market, on Tuesday afternoon, September 19.

One of the traders at Tanah Abang Market Anton (36) said TikTok Shop had greatly harmed traders in Tanah Abang.

This is because the prices offered on the platform are very cheap compared to the Tanah Abang mall and Pasar.

"Yes, asking the Minister for help, online shop, TikTok which is very influential for traders here, can (help find a solution)," Anton told reporters.

He considered that the price on TikTok Shop was very cheap and unreasonable.

Another trader named Anggi (31) also complained about the same thing.

He asked the government to immediately close the TikTok Shop because it made its sales turnover drop dramatically.

"The turnover was reduced by 80-90 percent. Usually my (income) is Rp. 40-50 million, now it's difficult to get Rp. 1 million," he said.