JD.com’s Logistics Unit Delivers $4.5 Billion in Revenue
JD.com’s logistics arm is delivering — reporting 30 billion yuan ($4.5 billion) in annualized revenue.
In April, China’s second-largest online retailer spun off its in-house delivery platform into a subsidiary — JD Logistics. Skeptics questioned the necessity of such a move and whether the unit could turn a profit in China’s competitive delivery landscape.
Compared with rival Alibaba’s Tmall and Taobao — which rely on third parties to offer parcel-delivery services — JD.com has long run its own distribution network.
It uses JD Logistics for the delivery of products sold in-house, which account for more than half of the merchandise it sells on its platform, while independent merchants on JD.com usually employ a private courier of their choice.
But “these independent merchants are also increasingly shifting to JD Logistics, which significantly contributed to the increase in revenue,” said Wang Zhenhui, CEO of JD Logistics.
“We hope to elevate our total revenues to reach more than 100 billion yuan, with more than 50% of orders coming from independent merchants and even from other companies,” he added.
But continuing JD.com’s growth in the logistics sector could be challenging. The area is currently dominated by several players including SF Express Co. Ltd. and Shanghai YTO Express Logistics Co. Ltd.
JD.com’s focus on expanding its logistics system also highlights its efforts to improve efficiency and have more control over consumer data.
In July, one of China’s smaller private couriers, Tiantian, accused JD.com of forcing merchants on its platform to refrain from using Tiantian’s services — which the courier called a “severe violation of market order.” JD.com said the decision was spurred by Tiantian’s “poor quality of service.”
Alibaba has also stepped more firmly into the sector. In 2013, Alibaba set up Cainiao to provide logistical support to its merchant partners. In September of this year, the e-commerce giant announced a plan to take full control of and pour 100 billion yuan into Cainiao, aiming to build up a network that can make rapid deliveries anywhere in the world.
Contact reporter Mo Yelin (email@example.com)
Sep 30 05:44 PM
Sep 30 05:19 PM
Sep 30 04:44 PM
Sep 30 02:29 PM
Sep 30 02:00 PM
Sep 30 01:47 PM
Sep 30 11:59 AM
Sep 29 05:36 PM
Sep 29 05:23 PM
Sep 29 12:43 PM
Sep 29 12:36 PM
Sep 28 07:00 PM
Sep 28 03:53 PM
Sep 28 02:24 PM
Sep 28 12:22 PM
- 1In Depth: Experimental International Reactor Powers China’s Dreams of Limitless Energy
- 2In Depth: Will Huawei Become China’s Tesla Challenger?
- 3China Developer Evergrande Denies It’s Seeking Government Support
- 4Exclusive: Former Citic Bank Vice President Sentenced to 12 Years for Bribery
- 5Gallery: Snow Blankets Iconic Mountain Lake
- 1Power To The People: Pintec Serves A Booming Consumer Class
- 2Largest hotel group in Europe accepts UnionPay
- 3UnionPay mobile QuickPass debuts in Hong Kong
- 4UnionPay International launches premium catering privilege U Dining Collection
- 5UnionPay International’s U Plan has covered over 1600 stores overseas