The holiday season will no doubt prompt many to shop for gifts online, but the work that goes into receiving, packing and delivering the thousands of orders placed each day is more than what Santa’s mythical elves can handle. Across seven markets in Southeast Asia, plus Spain, Singapore-based Synagie is doing just that.
Synagie started off in 2014 as Beautiful Me, an online store for a range of “BBB” products — or “body, beauty, baby”. According to one of its founders, this was before e-commerce marketplace giants Shopee and Lazada had even entered Singapore.
As online shopping was still a novelty then, co-founder and managing director Olive Tai recalls that many brands were clueless about how to sell their wares to customers over the Internet.
“At that time, a lot of the MNC brands didn’t know how to go onto the marketplaces, they had no clue. They didn’t know how to do the fulfilment, they didn’t know how to manage the seller centre, they didn’t know whom to talk to,” says Tai to The Edge Singapore.
Armed with more than a decade of experience in the fast-moving consumer goods (FMCG) sector, Tai left Watsons Singapore, where she was a trading director, and partnered with one of her former suppliers. She successfully convinced over 360 brands to launch on Beautiful Me, but that debut also coincided with new entrants and their deep pockets from China.
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Tai says the “conversion cost” of attracting each new customer was “over $10”. “We were fighting with Alibaba and Tencent; just getting a new customer was impossible.”
Qoo10 was the first marketplace that suggested Beautiful Me join its platform. Formerly known as Gmarket, the South Korean e-commerce marketplace had been active in Singapore since December 2008. “That’s how we started to pivot,” says 48-year-old Tai.
Tai told her brand partners “one by one” about the new plan, and many were keen on the idea. “They said: ‘Yes, since you are able to sell on the platform, why don’t you help us do it?’ That’s how we actually pivoted to the B2B2C model.”
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That pivot has helped Synagie become an “e-commerce enabler” alongside the explosive growth of platforms like Shopee and Lazada. Now a “strategic regional partner” on both platforms, Synagie boasts over 600 brand partners today, including Nike, Lululemon, Moet Hennessy and Estée Lauder; and operates over 1,000 e-stores.
From content production to supply chain management, fulfilment logistics, data analysis to strategic consulting and customer service, Synagie provides a one-stop, end-to-end solution for companies to navigate their online sales.
Synagie listed on the Singapore Exchange S68 (SGX) in August 2018 at a market capitalisation of $71 million. It was the first e-commerce marketplace listed on the SGX and Tai reached out to Alibaba for capital. However, the investment team was not interested in a Singapore-listed firm then. That changed after two years, when Alibaba took Synagie private in November 2020.
For her work at Synagie, Tai has been named EY Entrepreneur of The Year in e-commerce services, and joins three recipients at the 22nd EY Entrepreneur of The Year (EOY) 2023 Singapore awards.
All four award recipients this year are women, and Tai is pleasantly surprised by the decision. “To the women entrepreneurs out there, I know it is even harder, having to do what we do while fulfilling what are still very traditional expectations of being an Asian daughter, wife or mother. Hang in there and try ways to support and collaborate with each other. Together, we can make a change!”
Tai is an exco member of the Singapore Women Entrepreneurs Network (SG-WEN), a network formed by the Singapore Business Federation (SBF) to coordinate the existing efforts of businesswomen within the community, and to serve as a platform to connect with other women-entrepreneur associations in the Asia Pacific.
SG-WEN celebrated its second anniversary in September, and has close to 650 members today, says Tai. “We hope to really provide a platform where Singapore women entrepreneurs can unite and also collaborate with each other. We do this by advocating and promoting the female business perspective, facilitating knowledge-sharing and also fostering business partnerships.”
Sustainable packaging
The advent of online shopping has also given rise to a surge in packaging waste, an area Tai and her team have been focusing on since 2021.
This is because the company’s work includes packing products from scratch. For certain luxury brands, these steps may include individually perfuming delivery boxes, tying ribbons, engraving and printing customised cards to create what Tai calls “a great unboxing experience”.
To reduce waste, Synagie has switched from plastic tape to paper tape. The company also skips bubble wrap in favour of a special paper packaging that inflates, forming an “air pillow”, says Tai. This protects goods during delivery, ensuring even prized bottles of wines and spirits by Moet Hennessy make it to customers’ doorsteps safely, she adds.
According to Tai, making the switch to “green packaging” has helped Synagie reduce about 70% of its carbon footprint, and the company is “certified net zero”. “In some markets, we use solar panels to manage the energy [use] and then for the balance, which is Scope 3, something that we cannot control, we get carbon credits to offset.”
Now, the company wants to help its brand partners do the same for their sustainability journeys. One of Synagie’s 12 business units offers a carbon measurement tracker for over 5,000 categories of products, powered by Alibaba’s ESG data, says Tai.
“They calculate the weight of the items, the footprint of each, and based on the geographical area, they measure the carbon footprint of the delivery,” she adds. “We can also help brands to buy carbon credits and help them [achieve] net zero.”
That said, the take-up rate among Synagie’s partners has been “a little bit slow”, says Tai. “I think unless the government is really pushing really, really hard for every single [company to do so] and people have no choice to start measuring it — I think we are the only one that really cares so much about this.”
Venture lab
Tai is able to demonstrate the entire packing process — green packaging and all — in a two-month-old “venture lab”. Located in a unit adjacent to the company’s office at Sin Ming, the space offers a complete mock-up of Synagie’s entire chain of operations.
From a shelf of products to a packaging station, and even a livestreaming studio on a mezzanine floor, the venture lab offers participants a rare look at the many steps that go into fulfilling online orders.
In addition to welcoming SME partners, Tai says she is in talks with some schools to invite their students to the venture lab. “We did a workshop recently and met with a lot of principals. They told me students have asked them how to sell things online and they have found it very difficult to educate them [on such matters].”
Tai hopes the venture lab can show students the “reality of being a KOL”, or key opinion leader. “[The principals] say a lot of the young people want to be influencers or YouTubers. But in reality, is it really so rosy?”
Synagie is also using the space to host participants from SMU Academy, the professional training arm of Singapore Management University. According to Tai, the company is working on some 60 modules to cover the entire supply chain as part of a course offered by the university.
Growth plans
The company is in the midst of a “major transformation phase”, says Tai, adding new solutions to its product suite and even changing its billing model.
“In the past, we just charged [fees] based on percentage of sales, so how much you sell is how much you pay. But if you continue to do that, you realise that the model will not be sustainable, because this whole marketplace is very focused more on seasonal [sales] like 11.11 and mega-campaigns. Unless every day is a mega-campaign, and you will not be able to charge a decent fee to cover your costs,” says Tai.
Now, Synagie charges a fixed subscription fee along with a “smaller percentage” of sales. The company has also transitioned from purchasing stock to working with consignment suppliers, ensuring healthier cash flow.
Tai says Synagie is “very close to profitability” and breaking even. “That is one of the reasons why we actually made a very bold move to change our [business] model and… the way that we charge our suppliers.”
The company has also expanded into Europe. As borders reopened following Covid-19, Alibaba launched its marketplace platform, Mira Via, in Spain. “They invited us to go there and support them, because in Europe, the biggest player is probably Amazon,” says Tai.
Synagie set up its Spain office in September 2022. “I guess we are also the first Southeast Asian e-commerce solution provider to expand to Europe and have a global presence.”
Tai eyes even more growth outside the region. “As long as this sort of ecosystem exists, wherever they go, I think we should be there. So if one day, Tencent or Alibaba decides to expand to maybe Australia, or other markets in Europe, we will be there.”
Photos: Albert Chua/The Edge Singapore
