This article, written by WPIC CEO Jacob Cooke, originally ran on TechNode on June 4, 2021.
In China’s fiercely competitive e-commerce market, JD.com has aimed to differentiate itself through high-speed delivery. The company says that about 90% of its orders were delivered on the same or next day in 2020. That’s because of JD Logistics, the company’s logistics subsidiary.
Across Greater China, JD Logistics owns a sprawling network of over 800 warehouses that are strategically located near end consumers, and the organization directly employs 190,000 delivery workers. It has also invested in 5G, machine learning, and automated technologies to boost efficiencies across the supply chain.
On Friday, May 28, JD Logistics became its own publicly traded company, raising over $3 billion through an initial public offering (IPO) in Hong Kong.
The company has said it will use the capital injection to invest in further technological innovation and improvement of its delivery networks, especially in lower-tier cities.
The full effects of that will only come to fruition, however, if JD Logistics makes a significant pivot in which platforms it chooses to work with now that it has more operational independence from its parent company.
A more independent JD Logistics should consider working with JD.com competitors like Alibaba’s Tmall, Pinduoduo, and Douyin. It’s a move that would benefit the entire e-commerce market, including consumers, brands, and the company itself.