Who is Driving Developments in Supply Chain and Customer Service – Retailers, Brand Owners, Logistics Companies or Technology Providers?

On June 18th, a normal day in the UK, however in China, it was the ‘Mid-year Online Shopping Spree’. This is an annual promotion of one Chinese e-commerce giant – JD.com and customers spending power was explosively unleashed on this day. Do you know what was the value of transactions? – Eighteen point three Billion Pounds! Incredible… However the top record of daily transaction was still kept by another E-commerce Giant – Alibaba,which was Nineteen point three Billion Pound on Single’s Day – November 11th in 2017.

During the spree, JD Logistics – a subsidiary of JD.com enabled 90 percent of sales orders to be delivered within the day and the day after from its 500 warehouses and 7,000 pick-up and delivery stations across the country.

The Logistics Industry, with E-commerce, Finance, Hitech Industry like Integrated Circuit, Cloud Computer is within China’s Long-Term Development Strategy. It has boomed by more than 50% for six consecutive years due to the increasing popularity of online shopping and e-commerce. Some 80 million parcels are delivered every day, adding up to thirty-one point three billion a year. These numbers are still increasing … China’s largest e-commerce firms Alibaba and JD.com have played a large part in this boom, JD Logistics together with Cainiao Smart Logistics Network which is owned by Alibaba have been pouring billions of Dollars in building up a logistics infrastructure and aim to provide ever faster deliveries and better services to their customers.

In addition to investments in land and buildings, they both invest heavily in technologies to make their extensive delivery system and network among the most sophisticated and efficient in the world.

During the Global Smart Logistics Summit in May 2018, advanced logistics technology was on display everywhere, from automated guided vehicles (AGVs) to unmanned trucks for long-distance transportation, from autonomous drones to self-driving carts, intelligent warehouse and security tracking… moreover a lot of these technologies are already in service around us throughout China.

For example, the driverless vehicles operate at a top speed of 15 kilometers per hour, are able to avoid any barriers on the road, and also adhere to the traffic lights. Customers will receive an instant message to pick up their delivery. The customer can also choose to accept their packages by either facial recognition, passwords or via mobile app.

Besides, more advanced smart robots can climb stairs to deliver heavy products such as refrigerators and furniture as many older buildings in China are not equipped with elevators. Virtual Reality services are being applied to allow users to experience products in a more immersive way digitally.

Everyone might be aware of Bitcoin, a hot topic isn’t it … and it’s the representative blockchain application of the financial sector… In the meanwhile, Block chain technology empowers an upgraded logistics services by establishing a more secure, speedy and transparent system. An organisation named BiTA (Blockchain in Transport Alliance) was founded with the mission to forge supply chain industry standards in blockchain applications was founded last year and so far a lot of the world’s leading logistics giants like FedEx, UPS and technology companies as Google, Amazon SAP have showed interest and joined this alliance. Richard Liu – CEO of JD.com used 3 words to describe the next 10-year plan during the kick-off meeting early this year, they are “technology, technology, technology.”

In June, Google announced that they will invest $550 million in JD.com, it’s a strategic partnership. By applying JD’s supply chain expertise and brand,and Google’s technology strengths, these two companies aim to explore the creation of the next-generation retail infrastructure solutions, shopping experiences and customer services…this is the future…

Companies like JD.com and Alibaba who are all four of: Retailer, Brand owner, Logistics company and Technology provider, they’re fostering the new ecosystems and driving Developments in Supply Chain and Customer Service also driving China and global economy!

Leo Shen 27 June 2018

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