JD.com, China’s second-largest e-commerce company after Alibaba, will create a new business group called JD Logistics. Not to be confused with a Wisconsin-based company that has a similar name, JD Logistics will take advantage of JD.com’s existing delivery and warehouse infrastructure.
JD.com is in good company: Amazon and a lot of other companies, big and small, are rushing into the logistics space at all entry levels to redefine what delivery means in an online retail world.
Unlike Alibaba, the Beijing-based company has invested heavily in its own fixed assets such as warehouses and delivery trucks to ensure good service, and facilitate the buying and selling of everything from electrical goods to boxes of kiwi fruit.
JD.com’s logistics network has also helped win more users through speedy shipping, and the company is competing with Alibaba to sell consumer goods, electronics and home appliances. Liu pointed to stepped-up investments in logistics automation as well as financial and technology services as areas that will ensure success for China’s second-largest online retailer for the coming decades. E-commerce is already contributing substantial cash flow, Liu said.
JD.com is on track to handle 14 percent of China’s total 2016 e-commerce spending, compared with Alibaba’s 78 percent, according to JP Morgan. The bank’s analysts, led by Alex Yao, said in August that JD.com’s gross-margin improvement was positive, but had a cautious view of its operating expenses.
- JD.com Is Already Using 30 Self Designed and Engineered Drones for Delivery
- Taobao Villages: Alibaba Is Deeply Entrenched in More and More Rural Regions in China
- China: E-Commerce No. 2 JD Makes $71 billion in 2015
- How China Post’s Ule Is Building the World’s Largest Retail Network
- From Drones to Subterranean Delivery: What Amazon’s Fantastical Patents Really Mean
- Alibaba, Amazon, Startups, Everyone Wants to Disrupt Global Logistics