Jd.com which is an online retailer based in China is taking a chance with the package delivery market in the country. The Chinese parcel delivery service is very competitive, and Jd.com has decided to open its logistics network to ship parcels for its consumers and businesses. The company announced this move on Thursday and the first trial would be for businesses and consumers in Shangai, Guangzhou, and Beijing. The company has incorporated this delivery system in its app so that their clientele can send and receive packages domestically using the company’s app. Through the app, WeChat, the customers can make pickup requests. The WeChat app is a social messaging app that connects thousands of users throughout China.
Jd.com competes with Alibaba which is another an e-commerce firm in the country, and they hope to surpass them by expanding their services to include both business and residential deliveries. This would be done between two points in areas in China, and this will prompt Jd.com trucks and vans to move the goods into a broader network. This would put them in competition with other e-commerce retailers such as ZTO express and United Parcel Service. The company assures that their network logistics can reach up to 99% of the population and deliver packages on the same day to 90% of the orders made.
Zhenui Wang who is the CEO of the company spoke saying that they have been building these logistics for over a decade and this step is a way of leveraging it.Jd.com faces stiff competition from Alibaba and Amazon Inc. Amazon Inc is preparing to establish a delivery system in the US, and it has invested heavily on branded trailers and cargo operations. Jd.com and Alibaba continue to fight for the market share of package delivery with Jd.com logging in 122.3 billion yuan. However they losses are significant as they spend so much on automated warehouses and other top notch technology. The distribution network at Jd.com now stands at 15 logistics park, 7000 delivery and pickup stations and close to 500 warehouses.