Rocket Internet-Backed Zalora Denies That It Is Shutting Down Taiwan Operations [Updated]

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UPDATE: A spokesman from Zalora Taiwan said:

To better serve Taiwan on its business operations model, the company has decided to conduct a review to make changes – From April, we are shifting part of Taiwan’s operations to our regional headquarters in Singapore. During this migration period, our company will temporarily disable operations of the Taiwanese site. We sincerely apologize for any inconvenience this may cause to our customers, and we promise that any returns and refunds will be processed as per the time period stipulated on our site. If you have any further queries, please contact CS@zalora.com.tw, our customer service department will answer your questions within one working day.

ZALORA TAIWAN denies any rumours regarding bankruptcy or closure. We will process and complete all payments to our customers and vendors. All our employees will be managed in accordance with and with respect to the labour law in Taiwan. We will not make any further comment on rumours, and reserve the right to take legal action against any parties making false statements about us.

One year after launching in Taiwan, Rocket Internet-backed Zalora may be shutting down its operations in the country. Though the Singapore-based fashion e-tailer has yet to issue a confirmation, e27 notes several signs that a closure of its Taiwan branch is already in progress.

Zalora Taiwan’s Web site currently says that it will no longer provide telephone services for customer support after today. Furthermore, Taiwanese TV news station TVBS reported last week (link via Google Translate) that more than 100 employees were suddenly laid off as Zalora canceled orders from suppliers. Reasons cited by TVBS for Zalora Taiwan’s potential demise include the high cost of marketing in Taiwan’s saturated online retail market, which is already dominated by e-commerce sites Yahoo! Taiwan and PChome.

Zalora recently landed several high-profile investments, including $26 million from German retail conglomerate Tengelmann Group, but as Jacky Yap of e27 notes, Rocket Internet has already encountered several setbacks in Southeast Asia, including the closure of Home24. “Rocket Internet will not hesitate to pull the plug when it comes to evaluating a likely failure,” just as it shut down its operations in Turkey last August, Yap writes.

Despite Zalora’s rapid growth, the reported closure of its Taiwan operations is a reminder that Rocket Internet’s foothold on the Asian market is still not a sure thing. I’ve reached out to Zalora’s HQ for comment and will update if I hear back from them.