How products ordered online or from mobile apps can be delivered quicker to customers has been the challenge e-commerce companies all over the world are seeking to win. JD.com, one of China’s two biggest e-commerce companies is already looking to win that race by getting its products delivered to anyone in China in 30 minutes or less. How does it do that? In some cases, drones do the job taking products right from the supply outlet directly to the customer’s doorstep. But there also are algorithms that JD uses that match their customers up with either distribution centers, partner retailers or even locally owned convenience stores.
Some of the world’s most recognized retail brands are a part of JD’s delivery experience including Walmart whose Chinese supercenters offer delivery services to the customer base, and Nongfu Spring is also a part of this. Even as JD has ramped up their delivery speeds, their arch rival Alibaba has started bringing its offline retail partnership delivery services in motion. Both companies have significant stakes in various food markets that offer on-site preparation. Li Zhou, a key leader at Nongfu Spring has commended JD for bringing in even more online orders for their products in the last several months, an increase of 20℅.
Liu Quingdong, who also goes by the name of Richard Liu is the man who founded JD.com and continues to be the key leader as CEO and president of its board of directors. Liu’s background is one that comes from a business family and even includes him achieving a bachelor’s degree from the prestigious Renmin University. His initial endeavors to go into politics were abandoned early in his career, and his first attempt to start a restaurant business failed. So after working for a computer programming company for about a year, Liu found opportunity in a magneto optical drive sales business that some friends of his helped him get into.
This business was where JD originated from after Liu formed its name and operating structure as JingDong, a combination of his last name and that of his then girlfriend who was also his business partner. The company’s original product line was primarily consumer electronics, but over the years it accumulated other inventory. It had been originally setup as a regular brick and mortar operation, but when China was hit with the SARS outbreak in 2003, stores had to close and employees had to take off sick time. That’s when Liu decided to change the business from brick and mortar to running it online with distribution centers for its orders. Subsequently, it was renamed JD.com.
Liu Quingdong built this company mostly on his own for the first 10 years or so, and then after Alibaba came online, private equity firm Tencent Holdings decided to buy a stake in it. Tencent has increased its ownership in JD over the years, and in a more recent deal they offered the company access to its WeChat app. In 2015, Tencent and JD’s board of directors orchestrated its first IPO which now has the company listed on the NASDAQ exchange. Liu helped negotiate the partnership with Walmart in China in 2016, and he would like to see additional deals done with North American companies, though he admits this will be a challenge with President Trump’s current tariffs in place.