High e-commerce fees squeeze margins

As of November, 10.2 million small and medium enterprises (SMEs) in Indonesia have gone digital as the pandemic pushed businesses to move online.

JAKARTA: Many small food and beverage companies feel their margins are being squeezed by high commission fees on e-commerce and food delivery platforms, putting their businesses in a tough spot, as mobility restrictions also compel them to digitalise to survive.

For Marwah Devianty, co-owner of homemade snack brand Mamichin, closing her online store on Shopee was a no-brainer as she paid higher fees and received lower profit margins compared with running her own webstore. The 26-year-old said that Shopee imposed a more than 3% fee for each successful transaction, higher than the 1% to 2% on other online selling channels.