JD Logistics Prospectus: Continuous Technology Investment to Drive Long-term Innovation

JD Logistics Prospectus: Continuous Technology Investment to Drive Long-term Innovation

by Yuchuan Wang

On Feb. 16, JD Logistics (JDL) filed its IPO prospectus with the Hong Kong Stock Exchange (HKEx), in which the word “technology” (including variations like technologies, techniques and technological) is stressed and mentioned more than 500 times.

Technology is at the core of JD Logistics’ development, and the company has invested RMB 4.6 billion yuan in technology research and development in the consecutive 11 quarters ending Sep. 30, 2020, which accounts for 3.4% on average of total revenue. According to the prospectus, JD Logistics will continue to invest in technologies such as automation, data analytics and algorithm capabilities to drive long-term service innovation.

As early as in 2014, JD Logistics started to run the first smart and large-scale logistics infrastructure: Asia No.1 fulfillment center in Shanghai. As of Sep. 30, 2020, JD has been operating 28 such facilities in China. In 2019, JD Logistics put in use China’s first 5G-powered smart logistics park in Beijing and partnered with China’s three leading mobile operators, namely China Mobile, China Telecom and China Unicom. So far, the 28 JD Asia No.1 fulfillment centers are all covered by 5G networks.

In addition, JD Logistics is a pioneer in adopting robots in its logistics network. Over 5,000 robots have been deployed in 100 of JD’s 800 total warehouses. The company also announced in Oct. 2020 that it will increase its fleet of logistics robots to 100,000 in the next five years. Furthermore, right after the outbreak of COVID-19 in early 2020, JD deployed its L4 autonomous delivery vehicle in Wuhan to ensure contactless delivery, and announced in October that it would help Changshu, a top 5 county-level city by GDP in China, build a smart city based on smart delivery vehicles. By the end of 2020, JD Logistics had 2,500 patents for automation and unmanned technologies.

Currently, JD Logistics has applied advanced technologies such as big data, AI, 5G, blockchain and IoT on every node of the supply chain, enabling automated and digitalized services and decision-making for both internal and external clients. For example, the Shanghai Asia No.1 fulfillment center is able to deal with over 1.3 million orders per day, which greatly improves the supply chain efficiency and service for merchants selling on JD.com. In 2020, JD Logistics served more than 190,000 business clients across a wide array of industries, such as fast moving consumer goods (FMCG), apparel, home appliances, home furnishing, electronics, automotive and fresh produce.

JD Logistics expects to further increase its investment in technology research and development to expand the company’s technology team, enhance technology capabilities and develop solutions and services to better serve customers.

 

(yuchuan.wang@jd.com)

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