Untapped reseller market in Indonesia worth billions: McKinsey

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The majority of online merchants in Indonesia are resellers and distributors, but they still represent a substantially untapped market, a report from McKinsey & Company noted.

The group makes up around 85% of the country’s online sellers, but they are often overlooked by consumer goods companies, retailers, and ecommerce platforms, the report found.

It also noted how resellers remain an underserved consumer segment for retailers. This leads to challenges such as squeezed margins, inadequate knowledge of demand and pricing influence, low visibility, and fluctuating social commerce performance.

However, this also means that the untapped reseller market represents a big opportunity, one that’s estimated to be worth between US$115 billion and US$125 billion in gross merchandise value.

Fast-moving consumer goods primarily dominate the reselling market, with an estimated value of US$60 billion or around 50% of the industry.

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To take advantage of this opportunity, McKinsey suggests that consumer goods companies, retailers, and ecommerce platforms harness this potential by delivering value-added services and collaborating with resellers as well as leveraging data to enhance their visibility.

“Supporting this critically important segment will not only boost the overall digital marketplace but also empower individuals who otherwise must continue to make do, subject to the vagaries of selling online in an information vacuum,” the report concludes.