Attention all sellers! There has been a major adjustment to TikTok’s Indonesian store!

Attention sellers! TikTok's Indonesian store has undergone a major adjustment!

Following Shopee and Tokopedia, the era of free admission to TikTok Shop has also come to an end.

According to the platform notification, in order to provide a better sales experience for all sellers, TikTok Shop Indonesia will adjust its commission policy starting at 9:00 am on June 1st. The previous commission rule of charging sellers a 1% sales fee and a fixed fee of 2000 Indonesian rupiahs per transaction for their products will be cancelled, and commission will be calculated proportionally based on the SKU cluster, category, and subcategory of the store’s sales from now on.

The commission calculation formula is: commission fee = commission rate X (product price-seller discount)

It is worth noting that if the buyer cancels the order or returns all the goods, the platform will refund the entire commission fee after verification; if the buyer only returns part of the goods, the commission fee will be calculated based on the value of the valid order. The commission rates for each category are as follows:

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In the Electronics and Digital category, mobile phones and electronic products are 1.9%; electronic accessories are 4.3%; computers and office equipment are 2.7%; virtual products, such as credit and bill payment, are 1%.

In the Clothing and Footwear category, men’s and women’s clothing and underwear, sports and outdoor clothing, and Muslim clothing are 4.3%; footwear, bags, fashion accessories, and other non-clothing items are 4.3%; jewelry and accessories are 1.9%; fashion and children’s clothing are 4.3%; textiles and soft furnishings are 3.6%.

In the Food and Health category, health products are 3.6%; pregnancy and baby products are 2.7%; food and drinks are 2.7%; and alcohol is 2.7%.

In the Beauty and Personal Care category, beauty products are 4.3%; and personal care is 4.3%.

In the category of household items, household appliances account for 3.6%; kitchen utensils account for 3.6%; furniture accounts for 3.6%; home appliances and hardware account for 3.6%; home decoration accounts for 3.6%; cars and motorcycles account for 3.6%.

In the category of personal leisure, books, magazines, and music account for 4.3%; pet supplies account for 2.7%; collectibles account for 3.2%; toys and hobbies account for 3.2%.

With commission rates rising on multiple websites, the signal released by TikTok Shop is clear: as it gradually establishes itself in Southeast Asia, the strategy of low prices to open up the market is about to end, and the era of entering the market with low commissions or even 0 commissions is over. Sellers will have to face further cost increases and compressed store profits. However, sellers don’t need to worry too much. In fact, the development of TikTok Shop in Indonesia is quite good. According to the latest data from Data.ai, TikTok Shop is currently the third-ranked shopping app in the Indonesian Play store. In addition, Indonesia accounts for the majority of the $4.4 billion e-commerce GMV that TikTok is expected to generate in Southeast Asia in 2022. Therefore, compared to many e-commerce platforms in Indonesia, TikTok Shop has many advantages for sellers.

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