Sep 22, 2020|
Reducing Cost and Damage, JD Logistics to Power Aiqin’s 8,000 Stores
by Yuchuan Wang
China’s leading maternal and infant chain store Aiqin recently announced a partnership with JD Logistics, which will now be fully responsible for the company’s fulfillment from warehousing to transportation and delivery. Additionally, the company will hand over more than 60% of its fulfillment business to JD Logistics. So far, JD Logistics has helped Aiqin lower the damage rate of delivered goods to 1/10 of its previous rate.
According to Aiqin, among every 100 products delivered to stores in the past, 7 to 9 would arrive damaged; and despite all of Aiqin’s efforts to hold previous partners accountable, the situation did not improve.
After switching to JD Logistics, the damage rate of delivered products decreased to lower than 7‰, according to feedback from Aiqin’s franchised store owners. JD has also facilitated an exclusive channel for fragile items, so that Aiqin no longer needs additional packages for those items, saving costs of RMB 60,000 to 70,000 yuan every month.
The maternal and infant product industry has particularly high demands for supply chain management, requiring a more precise management of product life cycles. The partnership with JD Logistics has already solved many problems for Aiqin’s existing supply chain network supporting over 8,000 franchised stores nationwide.
To supply such a high number of brick-and-mortar stores, Aiqin previously built warehouses in the south, north, southwest and central regions of China along with 60 service centers. However, these warehouses depended on various individual service providers in different regions, resulting in different service standards. What was even more troublesome was that there were other companies handling the transportation from warehouses to stores, which meant that “if there was a problem with the goods delivered to the store, the transportation staff would blame the warehousing staff and vice versa,” explained Junhua Peng from Aiqin.
Aiqin was constantly working to upgrade the required standards for warehousing and transportation, but struggled to solve the fundamental problems that were increasing fulfillment costs and resulting in a bad experience for offline store owners.
The partnership with JD Logistics will ensure that fulfillment to stores is a smooth and seamless process, from warehousing to transportation and delivery. “We should have partnered with JD earlier, freeing us from worry,” Peng said.
The partnership will enable individual stores to track procurement orders and adjust sales plans accordingly, something the previous system did not allow.
“Not knowing the location of the goods or when they would arrive often brought stress for sales,” said Hong Wang, an Aiqin franchised store owner.
As a leading modern logistics service provider, JD Logistics has accumulated over a decade of experience and expertise with extensive logistics infrastructure, and has expanded from serving JD’s hundreds of thousands of merchants to a wide range of industry players.