Mar 5, 2020|
Lei Xu: Merchants Better Performed by Using JD’s Services
by Rachel Liu
Lei Xu, CEO of JD Retail, flagged that the company has observed much better performance from merchants who used JD’s warehouse and logistics services than those who don’t during COVID-19. This was shared as he answered questions from analysts during JD’s Q4 and full year 2019 earnings call earlier this week.
“We believe that more and more customers, merchants and industries will pay attention to how the Internet and e-commerce provides high-quality products and services and brings more value to society,” said JD’s Xu. The epidemic will encourage more merchants to depend upon JD’s fulfillment service. On February 8th, JD announced a commitment to provide RMB 100 million in subsidies to merchants who use its fulfillment service.
In February 2020, sales of Lenovo’s Zhongxin Authorized Store on JD increased 238% year-on-year through employing JD’s fulfillment service. Chao Zhang, General Manager of the store said, “During the epidemic, many store owners were most worried about logistics because many delivery companies stopped service. But thanks to JD’s strong fulfillment capability, store sales were unaffected and are even growing.”
Starting from 2016, JD began to open its warehouse and logistics service to third party merchants, which means they can store products in JD’s warehouses and use JD’s last mile delivery service.
Since last year, JD has also been given more support to merchants who use its fulfillment service, especially the ones who joined in 2020. With access to JD’s supply chain infrastructure, these merchants were able to achieve rapid growth during the epidemic.