Mar 6, 2020|
External Services Accounted for 40% of Revenue for JD Logistics
by Ling Cao and Tracy Yang
By the end of 2019, JD Logistics’ revenue from external services accounted for more than 40% of its total revenue, reflecting the success of its open, technology-driven strategy. External services are any logistics and supply chain services outside of JD’s first-party business, including services provided to parties beyond the e-commerce industry. JD’s full-year 2019 earnings released this week revealed this encouraging achievement.
JD Logistics has driven the steady growth of JD.com as a whole, with JD’s FY2019 net service revenues from logistics services and other businesses up significantly from 16.8% and 27.0% in 2017 and 2018 to 35.5% in 2019. In addition, JD’s fulfillment expenses as a percentage of net revenues decreased to 6.4% in 2019, down 0.5% from the same period in 2018, mainly due to economies of scale from enhanced logistics capacity utilization and staff productivity.
Three advantages pointed out by Zhenhui Wang, CEO of JD Logistics during earnings conference call are the driving force behind this. “First, JD Logistics strives to provide the best experience in the industry. Second, it puts products in locations nearest to its customers by leveraging JD’s integrated fulfillment capabilities and e-commerce experience. Third, JD Logistics uses technology to drive efficiency and cost reduction.”
JD Logistics continues to focus on lower tier market penetration, improving service efficiency and quality. In 2019, JD Logistics launched a program to further increase delivery efficiency in lower tier markets. As of the end of 2019, 24-hour delivery covers 88% of China’s districts and counties.
Wang said, “Tens of thousands of employees are working to make sure medical supplies and daily necessities will reach areas in need, including Hubei province.” He added, “JD Logistics always puts employees’ health first. We’ve ensured all kinds of protective supplies reach frontline employees from the beginning of the epidemic period.”
JD Logistics is also supporting enterprises resuming operations by offering frontline positions and providing free software to small and micro enterprises.
“Customers trust the service we are able to provide during the epidemic period, and we will continue to improve the experience,” said Wang. Many merchants used or started to use JD’s fulfillment services during the epidemic period, and have reaped substantial benefits as a result.
Apr 25, 2024|
JD Logistics and MINISO Announce Expanded Partnership to Enhance Logistics Efficiency
JD Logistics (also known as JINGDONG Logistics), a leading global logistics provider, recently announced the expansion of its partnership with MINISO, the renowned household and consumer goods retailer. This collaboration, which began in 2022 with operations in Australia, now extends to MINISO’s network in Malaysia.
JD Logistics’ robust global supply chain infrastructure includes nearly 90 bonded, direct mail, and overseas warehouses across key markets such as the United States, Germany, the Netherlands, France, the United Kingdom, Australia, the Middle East, and Southeast Asia. Committed to replicating its proven supply chain management expertise from China in international markets, JD Logistics provides extensive support to a broad spectrum of clients, including international enterprises and Chinese brands expanding overseas.
MINISO’s diverse product range and rapid restocking requirements, combined with its strategic store locations in bustling commercial areas, present unique logistical challenges. These include critical delivery lead times and the need for off-hours operations to ensure uninterrupted customer experiences. JD Logistics has effectively met these demands through reliable and adaptable warehousing and fulfillment service solutions.
Notably, the trust built with MINISO has led some store managers to entrust their store keys to JD Logistics’ drivers to facilitate smooth and timely deliveries. Among them is JD Logistics driver Nick Yang, responsible for delivering goods to all MINISO stores in Sydney. Yang’s daily schedule involves commuting between JD Logistics’ warehouse and approximately 10 MINISO outlets throughout the city.
Over the next three years, JD Logistics will continue to develop its comprehensive global supply chain logistics network, which integrates overseas warehouses, international transshipment hubs, local distribution networks, and transnational transportation networks.
This partnership is not only a testament to JD Logistics’ proven expertise and global operational capabilities but also underscores the commitment of both companies to foster innovation in supply chain management for retail operations worldwide.
Apr 18, 2024|
JD.com Awarded 2024 INFORMS Prize for Excellence in Operations Research and Analytics
JD.com is honored to announce that it has been awarded the 2024 INFORMS Prize. This recognition makes JD.com the first Asia-based enterprise to receive the award, highlighting its pioneering use of advanced analytics and operations research/management sciences (OR/MS) within its business operations.
The INFORMS Prize is awarded an organization that has repeatedly applied the principles of advanced analytics and OR/MS in pioneering, varied, novel, and lasting ways. Previous recipients include Walmart, Wayfair, Amazon, UPS, Booz Allen Hamilton, BNSF Railway, Walt Disney Company, U.S. Air Force, General Motors, Intel, HP, IBM, Ford, Procter & Gamble and GE Research.
Speaking on behalf of the selection committee, Mehmet Gumus, 2024 INFORMS Prize committee chair, remarked: “JD.com is showcasing data science as a source of business success and a necessary element to achieve customer satisfaction with continuous and dedicated practice. JD.com is truly deserving of this prestigious prize, and the entire O.R. and analytics community joins INFORMS in thanking them for their priceless contributions to the field and the business world.”
JD.com’s commitment to enhancing operational efficiency and customer service through OR/MS has been integral to its success. The company has developed an independently managed intelligent supply chain system that utilizes cutting-edge operations research algorithms to optimize warehouse management and logistics operations. This includes the operation of hundreds of intelligent warehouses and dozens of “Asia No. 1” intelligent logistics parks.
“We are honored to accept the INFORMS Prize and will continue to be steadfast in our dedication to leveraging the transformative potential of operations research,” said Sandy Xu, CEO of JD.com. “Our company’s supply chain not only aims to lead the industry, but also enhance the efficiency and well-being of our entire ecosystem.”
By the end of the fourth quarter of 2023, JD’s supply chain infrastructure assets had grown to RMB 153.8 billion, an increase of 16% year-on-year. Managing over 10 million self-operated SKUs, JD has achieved a global leading average inventory turnover of 30.3 days. This operational prowess enables JD to fulfill 95% of retail orders within 24 hours, significantly enhancing customer satisfaction and setting new standards in the industry.
Photo Gallery: This Week at JD (March 2-6)
