The e-commerce event known as “Singles Day” in China has broken commercial records ever since online retailers in the world’s largest e-commerce market started selling retail therapy to the country’s single – and eventually partnered – population. Last year, Alibaba sold more than US$1 billion worth of goods in the first five minutes of sales.
This year, rapidly-growing rival e-commerce platform JD.com is setting the stage for an even more frenetic shopping day, and the extensive logistics preparation that such an event entails. Air Cargo World’s Charles Kaufman is on the ground in Beijing, going behind the scenes with JD.com as the retailer and logistics specialist gears up for what is likely to be its busiest day yet.
In April 2017, JD Logistics launched operations as a standalone business with the mission of reducing the overall cost of the supply chain. In practice, this means the company will gladly handle omnichannel fulfillment even for products that were not sold on JD.com.
“This year we expect the Singles Day peak to be higher because we are handling not only our own products, but for merchants selling on our platforms, and offline/other platforms as well,” Beth Bao, director of strategic planning at JD Logistics, told Air Cargo World.
Bao said that JD Logistics started planning four months out, bolstering its operations along three lines, indicating how JD.com expects e-commerce to evolve in the future.
JD.com maintains full control of its logistics operations, end-to-end. That means ownership and operation of warehousing, fulfillment and delivery. Doing so gives the company exclusive control of deep data, which, in turn, enhances predictive analytics and optimization of SKU placement so that products are close to the customers. On an average day, JD says it can deliver 90% of its orders same-day. But with more third-party retailers than ever before using the platform, and the expected surge, JD.com’s logistics specialist are continuously expanding capacity across the supply chain to handle the additional sales.
JD.com will be relying heavily on NewDada to make Singles Day deliveries this year. Bao explained NewDada as, “a crowdsourcing application where people can register to deliver parcels in their spare time.” She said that JD.com currently has 5 million active workers on the platform. “This coming Single’s Day, the crowdsourced network will handle 30 percent of JD’s deliveries. It thus provides the flexibility JD needs during peak periods. On a regular day, only a small fraction of orders are handled by NewDada.”
The third area where JD.com is amassing resources is automation. Bao said that the Chinese e-commerce and logistics giant was at the forefront of robotics, in terms of unmanned warehouses and last-mile delivery drones, which she said made JD.com a leader in e-commerce deliveries in rural areas.