JD Business Offering Demystifies Procurement Process
China’s largest retailer JD.com is offering enterprises of all sizes an easy way to meet all of their procurement needs. JD Business, JD’s procurement channel for enterprises to buy office supplies and services, MRO (maintenance, repair and operations) product and more, streamlines the procurement process for brands, providing a one-stop shop solution. Working with JD Business has helped companies improve procurement efficiency by 50% on average, decreasing comprehensive procurement costs by 15%. JD currently has more than seven million enterprise clients.
The traditional procurement process is very opaque, and requires having individual relationships with different suppliers to meet each business need. It also often involves leafing through a large book of different suppliers, and then requiring procurement teams to meet with prospective suppliers in person. JD simplifies the process by enabling enterprise customers to access a range of different products from different suppliers on a single platform. Importantly, as China’s trusted retailer for authentic products, JD’s system is designed from the ground up to bring an unprecedented level of transparency to the procurement process.
JD Business offers solutions to suit enterprises of all sizes. For small and medium enterprises, which have an unstable lifecycle and often a lot of movement within the organization, JD Business provides a transparent channel (b.jd.com) for procurement. This means that anyone who comes into the procurement role at a company has a clear record of invoicing and pricing information.
JD also works with more than 5,000 large companies, and can embed JD Business’ service into their existing ERP systems. Over 80% of companies in China on the Fortune 500 list have cooperated with JD Business for their procurement needs. A more recent addition to JD’s enterprise support portfolio is its MRO-specific procurement channel (imall.jd.com). Partners of JD Business cover a wide range of industries and include the likes of Volvo, Siemens and Bosch.
“We have spent several years understanding the needs of enterprise customers, and figuring out how to best serve them,” said Chunzheng Song, Head of JD Business. “Our extensive logistics network, relationships with suppliers and advanced technology put us in a position to meet the demand from businesses of all sizes.”
Volvo and Southwest Cement are recent beneficiaries of working with JD Business. Embedding JD’s procurement platform with Volvo’s supplier relationship management (SRM) system enabled Volvo to decrease its procurement cycle from three weeks to a few days. Working with Southwest Cement, JD leveraged its resources in supply chain and logistics to provide a one-click procurement solution enabling the company to lower procurement costs by 20%.
Volvo Automobile Asia Pacific
In 2018, JD Business signed a cooperation agreement with Volvo Automobile Asia Pacific to become Volvo’s first PunchOut and E-ordering smart procurement partner in the Asia-Pacific region. Embedding JD’s procurement platform with Volvo’s supplier relationship management (SRM) system has enabled real-time transparent flow of procurement management data, and has fully digitalized the procurement system, greatly reducing errors. As a result, Volvo has been able to decrease the procurement cycle from three weeks to a few days.
“Cooperating with JD.com has significantly improved the quality of our procurement visualization, enabling us to make transparent and efficient decisions,” said Hai Li, Vice President of Procurement at Volvo Automobile Asia Pacific. “In particular, the transformation of our procurement process has enabled our indirect procurement to become a value creation center.”
Southwest Cement is another of JD’s enterprise clients who has benefitted as a result of transitioning its procurement process. The company’s cement production capacity is about 100 million tons, and its production process requires a lot of industrial materials. In the past, Southwest Cement would procure materials from many different suppliers. JD leveraged its resources in supply chain and logistics to provide a one-click procurement solution enabling the company to buy thousands of products at reasonable prices. As a result of going online with JD, Southwest Cement has been able to lower procurement costs by 20%. In addition, thanks to JD Logistics’ extensive network, it takes just 36 hours for Southwest Cement to get their supplies after placing an order.
“Working with JD has drastically simplified our procurement process,” said Jun Zhang, Head of Supply at Southwest Cement. “In the past, our procurement managers would work with a bunch of individual suppliers to meet all of our procurement needs. This was a very time consuming and labor-intensive process. Now, we are able to get all of the supplies we need from a single place, delivered in record time.”