Thai SMEs and couriers hit as TikTok poised to monopolise e-commerce

The Star

a day ago

BANGKOK: An e-commerce expert has raised concerns over TikTok's growing dominance in Thailand's e-commerce sector. He warned that the platform's practices are bordering on monopolistic and could severely impact local entrepreneurs and logistics providers.
Pawoot Pongvitayapanu, a pioneer of Thai e-commerce and founder of TARAD.com, who also serves as CEO of Pay Solutions, pointed out that US tariffs on Chinese goods may lead to a flood of low-quality Chinese products entering Thailand via e-commerce platforms.
TikTok, in particular, is rapidly monopolising the market, affecting Thai SMEs and domestic delivery services such as Thailand Post.
Over the past few years, TikTok has grown exponentially by attracting users through engaging short-form videos. Once the platform had amassed daily traffic, it seamlessly introduced commerce features, giving it an edge over rivals like Lazada and Shopee.
The platform leveraged this user base by incorporating affiliate marketing strategies, using influencers to promote products in exchange for sales commissions.
As TikTok expanded, it introduced tighter controls on sellers. Thai merchants, who rely heavily on the platform, have found themselves forced to accept increasingly strict terms.
'Many sellers are now making little to no profit after paying commissions, advertising fees, and rising platform costs,' Pawoot said.
He also highlighted TikTok's preferential partnership with Global Jet Express (Thailand), operating under the J&T brand, sidelining traditional Thai couriers. It remains unclear whether this deal was made based on pricing or national affiliations, but it has certainly hurt local delivery firms.
According to Pawoot, TikTok has become a major entry point for Chinese products into Thailand. To push these products, the platform offers generous commissions to Thai influencers, encouraging them to promote Chinese items over locally made goods.
This leaves Thai sellers—especially those who manufacture or import independently—struggling to compete. Concerns have also arisen over the quality standards of many Chinese imports.
Moreover, TikTok has begun restricting sellers' access to their own customer data—names, addresses, and phone numbers—citing concerns over customer retention and privacy laws, including Thailand's Personal Data Protection Act (PDPA).
'TikTok is moving towards monopolistic behaviour by gradually increasing service fees and tightening control, while the government remains largely absent in regulating this space,' Pawoot said.
'In addition to the influx of Chinese goods, the supply chain and logistics systems are increasingly favouring Chinese companies, which constitutes an abuse of market dominance and exploitative practices.'
To counter this, he advised Thai entrepreneurs not to rely solely on one platform. Instead, they should diversify their sales channels—setting up their own websites, chat systems or sales pages to attract new customers and retain existing ones.
He added that the lack of strong legal safeguards for cross-border sales could reduce Thailand to a mere transit hub, where profits are siphoned overseas. In comparison, Indonesia and Malaysia have stronger regulatory frameworks to protect local markets.
Pawoot criticised the fragmented approach among Thai government agencies. There's no lead agency managing this issue. Responsibilities are scattered and uncoordinated, he said.
He called for collaboration between key public agencies—such as the Department of Internal Trade under the Commerce Ministry, the Electronic Transactions Development Agency (ETDA), and the Trade Competition Commission of Thailand—with private sector input to develop effective oversight.
Finally, he urged stricter controls on low-quality foreign imports, mandating proper registration in Thailand to close legal loopholes and prevent unchecked capital outflows. - The Nation/ANN