JD Logistics CEO Eyes External Business Growth: Financial Times

by Ling Cao

JD Logistics (JDL) listed on the Hong Kong Stock Exchange (HKEx) on Friday, May 28 with the ticker 2618.HK. JD Logistics CEO Yui Yu is confident the company’s external business will continue its rapid rise, he told the Financial Times (FT).

According to FT, JDL’s external customer base maintained a triple digit growth rate in the first quarter.

“In the future, JD Logistics will take ‘driving superior efficiency and sustainability for the global supply chain’ as its mission and use its technology-driven integrated supply chain to maximize its support of the real economy and the development of new businesses, and continue to provide clients with a high quality experience, and enable them to enjoy the most trustworthy service. We will also work with our partners to reduce social logistics costs and drive efficiency improvement for business and society,” Yu said in his remarks during the ceremony today at JD’s headquarters in Beijing.

An executive from one of JDL’s important partners, Skechers, told FT that JDL’s services are both efficient and priced well.

The Skechers executive was among the representatives who participated in JDL’s gong-ringing listing ceremony on stage, a group that included JDL’s customers, clients, and frontline employees.

Skechers started its cooperation with JDL in 2019. JDL helped the U.S. lifestyle leader optimize its warehousing network planning and the inter-regional merchandise distribution for Skechers’ e-commerce business in China.

As a result, Skechers’ weighted average fulfillment costs were reduced by 11%, and its weighted average delivery time in China was reduced by approximately five hours.

 

(ling.cao@jd.com)

JD Logistics Lists on HKEx

by Ella Kidron

JD Logistics listed on Hong Kong Stock Exchange (HKEx) on Friday, May 28 with the ticker 2618.HK. An IPO celebration ceremony was hosted at JD.com’s headquarters in Beijing, virtually connected to the exchange in Hong Kong. The opening price was HKD 40.36, and the IPO raised an estimated HKD 24.11 billion.

Nine representatives stood on the stage in Beijing to virtually ring the gong. They included JDL’s customers, clients and frontline employees. Willie Tan, executive officer of Skechers Greater China, Southeast Asia and South Korea, and JD Logistics’ six-axis robot (a logistics robot arm used in warehouse automation) sounded the gong together.

Salvatore Ferragamo launches its direct sales flagship store on JD.com platform,

JD Logistics CEO Rui Yu and the JD Logistics management team

Rui Yu, CEO of JD Logistics said in his remarks at the ceremony: “JD self-built its own logistics network in 2007. In the past 14 years, JD Logistics has taken the improvement of the customer experience as its responsibility. Through unrelenting investment in logistics infrastructure and technology, JD Logistics has launched services such as “211” (same- and next-day delivery) and 24-hour delivery in tens of thousands of counties and towns, redefining logistics service standards and providing JD.com customers with the best experience in the world.”

JD Logistics CEO Rui Yu

JD Logistics CEO Rui Yu

JD Logistics is the largest integrated supply chain and logistics provider in China in terms of revenue in 2020. The company operates a network of over 1,000 warehouses covering approximately 21 million square meters. It opened its first Asia No. 1 warehouse in Shanghai in 2014 and now has 32 such warehouses across China, including a fully unmanned warehouse which can process more than 1.3 million orders per day during peak seasons. JD Logistics has over 240,000 personnel, including 190,000 in-house couriers who deliver all across the nation, including the hardest to reach areas of remote villages and islands, day in and day out.

Yu added: “Following 10 years of incubation and accumulation of experience, JD Logistics opened up to the outside world in 2017, embarking on a new period of ‘integrated supply chain’ development. In 2020, JD Logistics provided supply chain solutions and logistics services to more than 190,000 enterprise customers around the world, earning their recognition and trust.” In addition to its own warehouse fleet, the company has over 1,400 cloud warehouses operated by third-party warehouse operators, enabling existing warehouses to become intelligent and digitalized thanks to JD’s technology. Today JD Logistics external client revenue has already reached 46.6% of total revenue.

Reflecting on the meaning of the IPO, Yu said: “This IPO allows JD Logistics enter a new stage of development, and also symbolizes taking on more social responsibility. In the future business scale and people organization will change, but the ‘customer first’ philosophy certainly will not. Business logic based on experience, efficiency and cost will not change. Adhering to the ‘noble principle of doing the right thing the right way’ also definitely will also not change.”

According to the company’s prospectus, JD Logistics proceeds will be used to upgrade and expand its logistics networks; to develop advanced technologies to be used in its supply chain solutions and logistics services; expanding the breadth and depth of existing solutions and for penetrating existing customers and attracting potential customers, specifically though investments in sales and marketing personnel and industry solutions development; and general corporate purchases and working capital needs.

Yu closed: “In the future, JD Logistics will take “driving superior efficiency and sustainability for the global supply chain” as its mission and use its technology-driven integrated supply chain to maximize its support of the real economy and the development of new businesses and continue to provide clients with the a high quality experience and enable them to enjoy the most trustworthy service. We will also work with our partners to reduce social logistics costs and drive efficiency improvement for business and society.

JD Logistics is the third JD entity to list on HKEx, joining JD.com (9618.HK), which completed its secondary listing on HKEx last Jun. 18, and JD Health (6618.HK), which listed last Dec. 8.

 

(ella@jd.com)

Photo Gallery: This Week at JD (May 22 – May 28)

JD Logistics listed on Hong Kong Stock Exchange (HKEx) on May 28 with the ticker 2618.HK. An IPO celebration ceremony was hosted at JD.com’s headquarters in Beijing, virtually connected to the exchange in Hong Kong. The opening price was HKD 40.36, and the IPO raised an estimated HKD 241.13 billion. Nine representatives and a JD Logistics six-axis robot sounded the gong.

 

JD opened an all-cargo charter flight between Shenzhen and Bangkok on May 28, the e-commerce giant’s first in the Asia-Pacific region. Open to enterprises (SMEs) in both countries, the freight-dedicated route will facilitate delivery of goods from China to customers in Thailand and vice versa within 48 hours.

 

JD Property, the business division for smart industrial development under JD.com and Beijing Tianrun New Energy investment Co., Ltd. a wholly-owned subsidiary of China’s leading clean energy solution provider Xinjiang Goldwind Science & Technology Co., Ltd., announced on May 26 to establish a joint venture focusing on clean energy development, investment and operation. First row in the photo shows Gang Li (left), head of operations, JD Property and Yantian Pan (right), vice president of cooperate business, Goldwind at the signing ceremony.

 

Carol Fung, president of JD FMCG Omni-channel, attended the 2021 CCFA China International Retail Innovation Summit held from May 23 to 25 in Shanghai, and gives a main stage speech titled “Embrace the new structure of retail, co-build new business ecosystem.” Click here to learn more about the key takeaways.

 

JD.com delivered its emergency aid to Yangbi Yi autonomous county in Yunnan province at 5 a.m. on May 22, after the county was struck by a 6.4-magnitude earthquake at 9 p.m. on May 21. In 2012, JD.com’s founder Richard Liu announced a company regulation stating that if a disaster happens anywhere in the country, the nearest JD warehouse should immediately donate and transport its goods to meet the emergency demands, and that its management does not need to obtain prior approval.

The Faces and Voices of the JD Logistics HKEx Listing Ceremony

by Yuchuan Wang and Martin Li

JD Logistics (JDL) listed on Hong Kong Stock Exchange (HKEx) on May 28 at 9:30 am Beijing time with the ticker 2618.HK. The company held a celebration at JD.com headquarters in Beijing, virtually linked to the exchange in Hong Kong.

Representatives including JDL’s customers, clients, and frontline employees participated in the gong-ringing ceremony on stage. Willie Tan, the executive officer of Skechers Greater China, Southeast Asia and South Korea, and a six-axis robot (a logistics robot arm) sounded the gong together.

Rui Yu, CEO of JDL expressed his gratitude towards clients, employees and their families, he said, “You are the most valuable fortune of JDL and our development cannot be separated from your great efforts.”

 

Rui Yu, CEO of JDL expressed his gratitude towards clients, employees and their families

Wenhui Zhang, who runs a small electronics company in Beijing, is a loyal customer that started using JD in 2004. Now he also uses JDL’ services to meet needs of his company.

“JD’s logistics service is really good and fast. I can receive my parcel the next day,” said Zhang.

“JD’s couriers are very thoughtful. They will call me before each delivery to check if there is anybody at home. They are also very polite to my family members,” added Zhang.

Zhang said he is satisfied with the logistics service he’s received in the past over 10 years.

“I’m willing to pay for better service,” he said.

 

Fan Zhang is the secretary of Shuangjing village in Chenggu county, Shaanxi province.

Fan Zhang is the secretary of Shuangjing village in Chenggu county, Shaanxi province. The village has over 60,000 tangerine growers. Affected by COVID-19, the procurement price for Shuangjing’s tangerines dropped sharply from nearly RMB 1 yuan a year ago to RMB 0.3 yuan in 2020.

JDL dispatched trucks to farms in Chenggu and helped sell over 200,000 kg tangerine leveraging parent company JD.com’s e-commerce resources.

“JD’s procurement price is 2 to 3 times higher than our previous channels,” said Fan Zhang. “They helped us sell nationwide and provided services from order collection, transporting, last-mile delivery and even after sales.”

 

JDL is the only company he believes that can deliver his fresh fruits to nationwide customers without damaging them.

Born in 1998, Xinyue Dong is a survivor from the 2008 Wenchuan Earthquake. Now he is a merchant committed to selling Wenchuan’s local specialties to China’s customers.

Dong began using JDL’ services in 2017. JDL is the only company he believes that can deliver his fresh fruits to nationwide customers without damaging them.

Each year, JDL will help Dong deliver over 15,000 kg of products. “Orders can be delivered as fast as the next day,” said Dong. “I wish JDL a brighter future and hope to collaborate in areas from logistics to business development.”

 

Skechers started its cooperation with JDL in 2019.

Willie Tan is the executive officer of Skechers Greater China, Southeast Asia and South Korea.

Skechers started its cooperation with JDL in 2019. JDL helped the U.S. lifestyle leader optimize its warehousing network planning and the inter-regional merchandise distribution for Skechers’ e-commerce business in China.

As a result of JD’s planning and execution solutions, Skechers’ weighted average fulfillment costs were reduced by 11%, and its weighted average delivery time in China was reduced by approximately five hours.

 

Tony Domingo is the senior vice president of supply chain and procurement of Nestlé Greater China.

Tony Domingo is the senior vice president of supply chain and procurement of Nestlé Greater China.

In September 2020, JDL and Nestlé co-launched a large-scale smart storage and distribution center in Tianjin, spanning an area of nearly 30,000 square meters and handling over 1,000 tons of cargo a day.

Leveraging JDL’s superior operational capability and technological advancements in supply chain management, the distribution center can identify specific products and loads that are destined for Nestlé customers, recognize their geographic locations, and use advanced intelligence to visualize and control the migrations or infiltrations of loads between different provinces.

The collaboration with JDL greatly increases the center’s efficiency, helping speed up code scanning and printing processes by 160%.

 

Jian Liu, a Beijing native, has been working at JDL for fourteen years.

Jian Liu, a Beijing native, has been working at JDL for fourteen years. He started as a driver in JDL’s northern China region and now leads a team of around 40 people.

Liu has not only improved his work skills by taking on different challenges at JDL, but also managed to complete a college degree. In 2014, supported by the company’s employee education program, he received a degree in business management from Renmin University after two years of study.

He also bought his own home and car, and even built a house in Fangshan in Beijing where he was born.

“Joining JD was the most correct decision I’ve made. I will keep growing with the company and making my contribution,” said Liu.

 

Yangjun Tang who hails from Sichuan, joined JDL in 2016 to work at the service station in Dongtou district,

Yangjun Tang who hails from Sichuan, joined JDL in 2016 to work at the service station in Dongtou district, Wenzhou, Zhejiang province, which is home to over 100 small and big islands and five of them have permanent residents.

In her first three years, Tang didn’t take a single vacation. Under her leadership, the station has grown to now have nine employees, who serve permanent residents living on the five islands. Three of the five islands are only accessible by boat. Island residents mainly rely on delivery service to receive their daily necessities.

“When our station opened, very few people knew of JD. Sometimes they even referred to JD as DJ. However, people now speak highly of JD’s service,” said Tang.

The station handles around 1,000 parcels each day. The number more than doubles during peak sales seasons such as JD’s 618 Grand Promotion.

Earlier this year, Tang took on a new responsibility to develop customers, which was a challenge for her. However, Tang, a resilient woman, chose to learn from other service stations and experienced colleagues, and communicate with sales team.

“I’m the type of person who must do something well if I decide to do it at all,” said Tang.

“Many people say women can’t work in logistics because it’s physically challenging. I don’t agree. Women are reliable, sophisticated, down-to-earth and good at communicating with customers. I hope more women can join my industry,” said Tang.

 

Rui Zou, who was born in 1994, joined JD by working at JD’s Asia No.1

Rui Zou, who was born in 1994, joined JD by working at JD’s Asia No.1 fulfillment center in Shanghai in 2016 after graduation from Anhui Polytechnic University.

Zou was involved in the construction, device adjustment and operation management of the unmanned warehouse in the center. He now is in charge of the unmanned warehouse, which has daily handling capacity of 1.3 million orders.

Zou has partnered with colleagues to explore innovations to improve operating efficiency of devices in the warehouse.

This past March, Zou bought his own home in Shanghai with the help of the company’s supportive financial measures.

 

Yonghuo Zou, joined Kuayue-Express in 2014 and started by unloading cargo. JD acquired controlling interest in Kuayue in August last year.

Yonghuo Zou, joined Kuayue-Express in 2014 and started by unloading cargo. JD acquired controlling interest in Kuayue in August last year.

He has received many company awards for his dedication to work and for his outstanding performance.

Zou said that, since the cooperation between JD and Kuayue, the work process has become more standardized. “Whenever we need to check any date, we can quickly find it,” he said.

Zou’s wife also joined Kuayue in 2020 and works as a driver.

 

(yuchuan.wang@jd.com; bjlihao3@jd.com)

Robotic Arm Sounds JDL’s HKEX Listing Gong

by Yuchuan Wang

JD Logistics (JDL) listed on the Hong Kong Stock Exchange (HKEx) on May 28 at 9:30 am Beijing time with the ticker 2618.HK. Among the representatives ringing the gong was a six-axis robotic arm from JD’s warehouse, which sounded the gong together with JDL’s client representative Willie Tan, the executive officer of Skechers Greater China, Southeast Asia and South Korea.

The six-axis robot is one of dozens of different kinds of robots utilized by JDL. It is based on AI technologies including deep learning, image recognition and more for automated picking up, sorting and stacking. Robots play a significant role in securing the fast and agile fulfillment of hundreds of millions of orders across more than 1,000 warehouses nationwide. JDL’s Shanghai Asia No.1 logistics park is able to handle as many as 1.3 million orders a day thanks to the application of advanced robots and automation technology.

The core of achieving such high efficiency is the execution of the concept of “human-machine synergy,” enabling employees to handle tasks smartly and swiftly.

In JD’s Beijing Asia No.1 logistics park, 330 AGVs (automated ground vehicles) work collaboratively to pick up consumers’ orders. Utilizing QR codes on the ground to guide their routes, the little robots automatically recognize and plan their route.

AGVs inside JD’s warehouse

JD’s “picker” employees can stay on the working platform and wait for the AGVs to come to them, enabling individual pickers to each pick about 250 orders per hour, which is three times the efficiency of a traditional picking approach where the warehouse worker would have to walk to the shelf, get the goods themselves and then go back to the packing area.

In Changshu, Jiangsu province, nearly a hundred autonomous delivery vehicles are delivering JD.com’s parcels to consumers’ homes. The application of such vehicles enables local couriers deliver 1.5 times more parcels a day, helping to increase their daily earning potential.

 

JD’s autonomous delivery vehicle

Logistics technology including robots and automation have offered huge potential to help employees develop and leave the hardest and most boring jobs to technology to handle. As early as 2016, JD launched a “cloud ladder plan” to equip staff members with technical abilities. Now, many front-line workers in JD’s warehouses and delivery stations have become professionals with technical abilities.

According to JDL’s prospectus, the company has invested nearly RMB 5.3 billion yuan in technology in the past three years. By the end of 2020, JDL was entitled to over 4,400 patents and computer software copyrights (including applications thereof), of which over 2,500 are related to its automation and unmanned technologies.

 

(yuchuan.wang@jd.com)

JD Launches Shenzhen-Bangkok All-Cargo Charter Flight

by Kelly Dawson

JD has opened an all-cargo charter flight between Shenzhen and Bangkok on May 28, the e-commerce giant’s first in the Asia-Pacific region.

Open to small and medium-sized enterprises (SMEs) in both countries, the freight-dedicated route will facilitate delivery of goods from mainland China to customers in Thailand and vice versa within 48 hours.

JD has opened an all-cargo charter flight between Shenzhen and Bangkok

“JD is excited for this opportunity to leverage our international supply chain resources to strengthen the relationship between Thailand and China, and to facilitate the transport of high-quality Chinese goods going to Southeast Asia and vice versa,” said Stard Huang, head of JD’s international logistics business. “We see enormous potential in Southeast Asia, and this is just the first step.”

Running between Shenzhen Bao’an Airport and Bangkok Suvarnabhumi Airport three times a week with same-day return, this end-to-end fully self-operated and full-link transportation route will not only greatly increase the speed of cross-border freight, but also provide vigorous support for the development of cross-border business through both Thai and Chinese e-commerce channels, including JD.com and JD’s joint venture in Thailand, JD Central (JDC).

“We’re excited that JD and JD Central can support SMEs to build robust business between China and Thailand,” said Korlarp Suwacharangkul, Chief Marketing Officer of JD CENTRAL. “We’ve seen that cross-border e-commerce between the two countries has huge potential for expansion.”

Currently goods exported from China to Thailand through JD’s route are expected to mainly include daily necessities, small household appliances, 3C products and other e-commerce goods; while good transported from Thailand will mainly comprise fresh produce, supplemented by industrial products such as auto parts.

However, SMEs that aim to expand business into other categories are also welcome to take advantage of JD’s all-cargo freight flight. In the past year, China has further opened its market to foreign goods by implementing beneficial policies with an aim to facilitate robust cross-border trade.  JD has also ramped up efforts to support cross-border e-commerce.

As of December 31, 2020, JD International Logistics has 32 bonded warehouses and overseas warehouses, with a total management area of approximately 440,000 square meters. Through cooperation with international and local partners, JD has established international routes covering more than 220 countries and regions, providing customers with integrated cross-border supply chain services.

 

(kelly.dawson@jd.com)

JD 618 Pre-Sale Orders up 640% YOY

by Ella Kidron

The 618 Grand Promotion season is officially underway. JD clocked in a 640% increase in pre-sales order volume YOY. During May 24-25, the term “pre-sales” was searched over 150,000 times. The number of brands and merchants participating in pre-sales have increased 126% and 437% respectively.

Lenovo, Xiaomi, Huawei (which placed top three in terms of order volume) and Haier were among the brands which broke the RMB 100 million mark over the two days. Pre-sale order volume of 751 brands increased 500% each while 1,142 sub-categories saw pre-sale order volume increase over 100 times. Such categories include hand-held stabilizers, home-use floor washing appliances, smart clothes dryers, trash sorters and massage chairs. Laptops, mobile phones, gaming computers, refrigerators, casual shoes, flat screen TVs, smart watches and baijiu were also among highly popular products during pre-sales.

Trends during 618 indicate renewed attention on time-honored Chinese brands and breakout trendy domestic brands, as well as FMCG products from Chinese companies. JD Super, JD’s online supermarket saw Mengniu room temperature yogurt, Evergrande natural spring water and Lanji Story cotton disposable facial towels as hot sellers. The top two mobile phones are Xiaomi 11 and Xiaomi 10s, further indicating JD consumers’ affinity for the Xiaomi brand. Many specialty fruits such as cherries from Yantai, Shandong province, Lychee from Hainan and peaches from Wuxi were also flying off the shelves.

Orders of electric scooters increased by 208% YOY. Pre-sales indicate the increasing individualization of consumer needs, especially when it comes to household items. Pre-orders of floor cleaning appliances increased by more than 40 times compared with the same period last year, of which new high-end floor washing devices account for more than 65%, while sweeping robots increased by 400% YOY.

Pets are getting love for sure this 618l. Pre-sales orders of beauty-related grooming appliances for pets increased 26 times while pet gastrointestinal care products were up 23 times over the same period. Health services are also must-buy items. On May 24, the overall turnover of oral health products increased nine times compared with last year, and the turnover over vaccine related services increased by 230%.

This 618 Grand Promotion celebrates JD.com’s 18 years of providing high quality services to consumers all over China. During the pre-sales period, the e-commerce giant’s 30-day price protection, free delivery and worry free return services make consumers more confident to get a head start on the mid-year shopping extravaganza.

 

(ella@jd.com)

Jing Zao Partners with Ziroom to Launch Commercial Campaign

by Hui Zhang

JD.com’s private brand Jing Zao (literally means made by JD) announced a promotional campaign on May 27 in partnership with Ziroom, a business unit of China’s residual brokerage Lianjia.com, aiming to provide fresh graduates with high-end home decor products at affordable prices.

The campaign invited KOLs to recommend different decoration styles suitable for rental houses with products from Jing Zao. Additionally, Jing Zao created a package with products including a Latex pillow, hair dryer, humidifier, and intelligent trash can, all of which are necessary for fresh graduates moving into a new rental house. The campaign will last from May 27 to June 3 and will offer various coupons to consumers to make it easy for graduates to access high-quality products.

“Jing Zao pays attention to both life quality and the practicality of products. We care about every demand from our consumers, and would like to reduce consumers’ pressure through our customer-to-manufacture initiative,” said a representative from Jing Zao. “We hope to create more high-quality products and understand young consumers’ preferences through our cooperation with Ziroom.”

The creation of Jing Zao in 2018 came from Chinese customers’ real demands. The rising middle-class customers are constantly looking for a comfortable and high-quality lifestyle. What’s more, the desire for a “better lifestyle” is spreading to a larger customer base. Chinese society is experiencing a consumption upgrade. Before, only bigger brands were associated with higher quality, but working directly with factories to develop products enables JD to have strong control over the product quality. Also, without the layers of the dealer network, high-quality products can be sold for cheaper prices.

Ziroom was launched in 2011 and has become the biggest rental housing platform in China. The company so far operates in 9 cities in China, serving 2 million tenants and 300,000 landlords.

 

(zhanghui36@jd.com)