Kakao launches mobile BTO platform in South Korea

South Korean chat giant Kakao is now tapping into manufacturing in the country as it continues to expand into other industries.
Written by Cho Mu-Hyun, Contributing Writer

Kakao, operator of South Korea's most popular chat app KakaoTalk, has launched a new mobile build to order (BTO) platform that it said will be the first of many of its "social impact" businesses.

The platform, Makers with Kakao, allows manufacturers to receive orders from KakaoTalk, helping the company save costs by minimising inventory.

The company will offer limited products on the platform's homepage weekly, with new products shown on Tuesday and orders taken for the following week.

Bags, clothes, figures and cups will be first products available. Visitors of the platform will be able to use Kakao Pay, the firm's mobile payment app, to purchase.

The chat giant is currently working with seven manufacturers, 12 brands and 10 artists. Vendors will also be able to start production once the minimum order quantity is exceeded, which will guarantee profits and combat waste from mass production.

The BTO platform will lower stand-by inventory as much as 20 percent, Kakao said, while consumers will be paying a fair price for their orders. Makers with Kakao will also help Korean manufacturers, who are losing out to cheaper Chinese and Southeast Asian labour forces, maintain profits.

In November 2014, Kakao first announced plans to launch various "social impact" businesses that utilise social media and mobile to fundamentally change conventional ways of living. It has since then formed a taskforce that focuses solely on making new business models.

The chat giant is attempting to diversify its revenue stream. It announced earlier this month that its securities app marked $4 billion in transactions, and in December last year got government approval to launch a web-based bank.

It bought South Korea's biggest music streaming service MelOn for 1.87 trillion won last month.

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