Briefing: JD.com expands one-day intra-city deliveries
Apr 25, 2019
What happened: Chinese online retailer JD.com has rolled out intra-city logistics services targeting individual consumers in a partnership with Dada-JD Daojia, the company’s grocery delivery joint venture in which it holds a 47% stake. Mainly targeted at the delivery of food, medicine, consumer electronics, apparel, and groceries, the express logistics service will operate in Beijing, Shanghai, Guangzhou, Shenzhen, and Tianjin. A package sent at 6 p.m. from Beijing will reach Shanghai at 10 p.m. the next day, the firm told local media.
Why it’s important: Thanks to the booming e-commerce industry, Chinese city-to-city logistics has expanded with names such as SF Express. As a company with fast and reliable delivery networks, it makes sense for JD to enter the emerging area. What’s more, launching an express service presents an opportunity for the embattled company to further monetize its in-house logistics capacity. Just a few days earlier, JD launched 30-minute delivery service within a three mile range for Beijing, Shanghai, Guangzhou, and Changsha. JD’s logistics arm faces increasing financial pressure after 12 years of losses. JD founder and CEO Richard Liu said in an internal letter earlier this month that the e-commerce firm’s logistics arm recorded net losses exceeding RMB 2.3 billion ($343 million) in 2018. Liu adds that the money the firmed has raised so far will only last two years if nothing changes.