ByteDance to cut 450 jobs in Indonesia after Tokopedia deal
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It is the first round of cuts since ByteDance combined its TikTok Shop with rival Tokopedia in January.
PHOTO: REUTERS
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SINGAPORE - ByteDance is slashing about 450 jobs at its Indonesian e-commerce arm in the first round of cuts since combining its TikTok Shop with local rival Tokopedia in January.
The reductions, equal to about 9 per cent of the arm’s employees, will commence as soon as June, according to people familiar with the matter. They added that the final number is under discussion and could fluctuate as conditions change.
The cuts signal that the Chinese social media giant is conducting an overhaul of its Indonesian e-commerce operation, seeking to eliminate costs after combining TikTok Shop with GoTo Group’s Tokopedia in a US$1.5 billion (S$2 billion) deal.
Indonesia is among the earliest markets – and thus far the biggest – for ByteDance’s e-commerce ambitions. Competition is, however, intense with rivals such as Sea’s Shopee and Alibaba Group Holding’s Lazada.
ByteDance is reducing staff across e-commerce teams, including advertising and operations, in part to eliminate duplicate functions, said the people, who asked not to be identified as the discussions have not been made public.
Following the combination of TikTok Shop and Tokopedia, ByteDance’s Indonesian e-commerce business has about 5,000 employees.
A ByteDance representative declined to comment.
The unusual pact, which resulted in GoTo being a passive backer of the merged e-commerce operation, allowed ByteDance to restart its Indonesian business and comply with regulations introduced to halt its online retail service. Indonesia first introduced the regulations to protect its local e-commerce services and small businesses from getting hurt by larger foreign companies.
ByteDance has joined Chinese tech leaders from Alibaba to Tencent Holdings in streamlining businesses and shoring up their bottom lines during an economic slowdown, with the firms combined cutting at least tens of thousands of jobs over the past two years.
ByteDance’s TikTok, which faces a divest-or-ban law in the United States, also let go hundreds of employees in its marketing and operations teams globally in May, according to sources, part of a bigger overhaul by its Chinese owner. BLOOMBERG
