Premia TNC Taiwan Team
Author
Coupang Taiwan, launched in 2022, is evolving from a platform focused on Korean product sourcing into a pan-Asian reverse direct purchase hub, now expanding to include direct purchases from Japan and Hong Kong after completing the second phase of its Taoyuan Logistics Center in 2023.
The Growth of Coupang’s Reverse Direct Purchase Platform in Taiwan
Coupang is rapidly evolving its Taiwanese operations into a regional cross-border hub. Following its success in the US and Korea, the company plans to open direct sales channels in Hong Kong and Japan by 2025. With its app ranking first in downloads in Taiwan in Q2 2023 and sales projected to grow by over 20% in Q4 2024 compared to the previous quarter, Coupang is strengthening its position in the market. Backed by Rocket Logistics’ continued investments, including a second logistics center and AI-driven demand forecasting. This expansion highlights Coupang’s shift from a Korea-to-Taiwan model to a broader cross-border platform linking Korea, Hong Kong, and Japan to Taiwan.
A Prime Market Entry Opportunity for Korean Companies and Global Sellers in Japan and Hong Kong
Opportunities for B2B Overseas Direct Purchasing Suppliers
Securing a global sourcing channel for Japanese and Hong Kong products. Taiwan serves as a testbed for traditional consumer goods, fresh food, and beauty brands.
Collaboration in Logistics and IT Infrastructure
AI-based inventory and logistics forecasting technology expands opportunities for local 3PL (logistics agency) solutions.
Reverse Direct Purchase Agency and Platform Services
Consulting on reverse purchasing for small and medium-sized enterprises, customs clearance and customs system development, and marketing and customer service outsourcing.
Expanding Fulfillment and Warehouse Investments in Taiwan
It is possible to operate a profitable building that houses office space within a logistics center, labeling, and returns processing centers.
Direct Brand Market Entry
Demand for OEM/ODM models through collaborations and joint ventures with popular Japanese and Hong Kong brands.
Realistic Challenges to Anticipate in Market Entry
Designing Effective Tax and Customs Structures
Fixed-business establishment issues can arise not only with B2C direct delivery but also with warehousing, labeling, and returns. Designing a tax system, including issuing unified receipts and sales tax (VAT), is essential.
Evaluating Platform Fees and Contract Terms
Differences in commissions across direct purchase channels, along with the competitive structure of logistics and advertising costs, need to be examined.
Managing Exchange Rate Risks and Remittance Challenges
A strategy is needed to prepare for TWD exchange rate fluctuations. Currency hedging is essential for volume planning.
Risks in Collaborating with Local Partners
When selecting a logistics or customer service provider, it is important to check their reputation and contract stability.
Adapting to Policy Changes
Taiwan’s revised e-commerce law requires tracking changes in consumption tax and customs regulations.
Coupang’s Reverse Direct Purchase Entry Strategy Explained
- B2B Supply Channel: Offers distribution opportunities for Japanese and Hong Kong brands, particularly for testing reverse direct purchase models.
- Logistics and IT Cooperation: Enables AI-driven inventory and logistics solutions to enter the 3PL (third-party logistics) market.
- Fulfillment Investment: Involves business opportunities related to warehouses, office spaces, and return processing centers.
- Platform Service: Includes consulting services for customs clearance, marketing, and customer service.
- Brand Collaboration: Focuses on combining OEM/ODM models with the unique capabilities of Korean companies.
Coupang Taiwan: A Growing Pan-Asian Hub
Coupang Taiwan is positioning itself as a global sourcing hub, much like Singapore, connecting Korean, Japanese, and Hong Kong brands with local and regional consumers. Beyond offering an e-commerce platform, it creates new opportunities through logistics, IT integration, direct purchasing consulting, warehouse operations, and brand launches, allowing foreign companies and Korean individual investors to generate profits in multiple ways. However, challenges such as customs clearance, permanent establishment, taxation, exchange rate risks, partner management, and local regulatory requirements must be carefully addressed. Working with local Taiwanese experts can help businesses prepare effectively and navigate these complexities.
Premia TNC Taiwan Team
Author
Premia TNC Taiwan is a dynamic team of experts dedicated to supporting businesses and entrepreneurs as they establish, manage, and grow their presence in Singapore and across the region. Premia TNC Taiwan specializes in providing tailored corporate services, from company incorporation and compliance to tax planning and accounting. With our extensive experience and deep understanding of the local regulatory environment, we are here to make business operations smoother and more efficient.
