However, Jingdong Logistics and Shunfeng are different in many aspects-although they are getting closer and closer in many businesses-at least for now, there are still many differences between them. From the mode point of view, SF Express is a typical network mode, and Jingdong Logistics is a warehouse allocation mode. Shunfeng is strong in the trunk line, and Jingdong Logistics is strong in warehousing.
In terms of resources, as of June 30, 2020, SF has 73 all-cargo planes (including 59 self-operated all-cargo planes), and there are 2004 routes for all-cargo planes and bulk cargo flights. There are about 45,000 self-operated and outsourced trunk lines and branch lines in SF, and the total number of opened trunk lines and branch lines is about1.654,38+0.000. In terms of Jingdong Logistics, as of the end of 2020, its self-operated transport fleet includes about 7,500 trucks and other vehicles; It has about 620 air cargo routes and cooperates with China Railway Corporation to use 250 railway routes. In terms of quantity, it is far less than SF. However, as of the third quarter of 2020, Jingdong Logistics has operated more than 800 warehouses with a total management area of about 20 million square meters. Accordingly, as of June 30, 2020, SF owns 194 different types of warehouses (including the new summer cold chain logistics center), covering an area of about 2.34 million square meters. At this point, SF is not as good as Jingdong Logistics.
Not only that, in the prospectus of Jingdong Logistics, SF Express was specifically mentioned. Jingdong Logistics said that SF Express is an integrated express logistics service provider, and Jingdong Logistics is positioned as a supply chain solution and logistics service provider. Compared with SF Express, Jingdong Logistics has obvious advantages in warehousing and distribution services, bulk cargo logistics services and logistics technical services, and can provide customers with integrated supply chain logistics services.
In fact, the supply chain is also the place where Jingdong Logistics has the most ink in the prospectus. For example, in terms of competitive advantage, three of the six items listed by Jingdong Logistics are directly related to the supply chain, including: the largest integrated supply chain logistics service provider, advanced proprietary technology that enables the whole supply chain, and an open supply chain solution platform that cooperates with students. The remaining three items are: strong operational efficiency drives high service quality, excellent brand image and customer experience, experienced and far-sighted management team and strong corporate culture.
From the financial data, the income of integrated supply chain customers also accounts for the vast majority of Jingdong Logistics' total income in recent years. For example, as of September 30, 2020, the cumulative revenue of Jingdong Logistics in the first three quarters reached 49.5 billion yuan, of which the revenue generated by integrated supply chain customers accounted for 79. 1%. In addition, integrated supply chain logistics services have also contributed to its revenue growth-in the first nine months of 2020, Jingdong Logistics' revenue from integrated supply chain customers increased by 33.8%.
Then, what kind of service is the integrated supply chain logistics service, what is its prospect and what can Jingdong Logistics do? This article combs as follows:
0 1 Growing market, unique position
According to Jingdong Logistics Prospectus, the so-called integrated supply chain logistics service is a market segment and advanced logistics service in the outsourcing logistics service market. This service is provided by a third-party service provider, but unlike isolated supply chain logistics service providers, integrated supply chain logistics service providers have the ability to provide comprehensive logistics services, including express delivery, vehicle and less-than-truckload transportation, last mile distribution, warehousing and other value-added services (such as on-site installation and after-sales service), and provide them to customers in the form of integrated solutions to meet their various needs.
Among them, inventory management plays a core role in integrated supply chain solutions. Jingdong Logistics also classifies customers according to whether they have used warehousing or inventory management-related services (namely warehousing and distribution services). All customers who use their warehouse services are classified as integrated supply chain customers. According to the consulting report, according to the total revenue of 20 19, Jingdong Logistics is the largest integrated supply chain logistics service provider in China.
Not only that, the number of customers in the external integrated supply chain of Jingdong Logistics and the income contributed by individual customers are also increasing. According to the prospectus of Jingdong Logistics, the number of customers in its external integrated supply chain was 32,465 in 20 18, and increased to 39,926 in 20 19. In 20 18, the average income of each external integrated supply chain customer of jingdong logistics reached 234,057 yuan, and increased to 27,9401yuan in 20 19.
According to the consulting report, the market targeted by Jingdong Logistics is still full of huge growth opportunities.
From the demand side, the rapid development of digital economy in China and the fragmented, diversified and complicated demand of end consumers urge enterprises to provide faster and more flexible supply chain logistics services. The characteristics of supply chain in different vertical fields are different, so it is necessary to tailor the integrated supply chain solution according to the characteristics of specific industries.
From the production side, the efficiency improvement of the logistics industry in the past mainly focused on the distribution side, that is, the transportation of finished products from manufacturers to end consumers. In fact, the manufacturing side still has great potential to improve efficiency. With the help of end-to-end integrated supply chain logistics services, enterprises can improve efficiency through better raw material procurement and production planning.
From a technical point of view, every link of enterprise supply chain has produced a large amount of data. The analysis of these data can make enterprises understand the reasons of inefficient operation more comprehensively and make better business decisions. Integrated supply chain logistics services can cover the supply chain more widely, so that valuable data can be better tracked, integrated and analyzed, thus providing value-added services for enterprises.
In addition, national preferential policies and reforms to improve supply chain efficiency, reduce logistics costs and promote the adaptability of advanced technology applications will also contribute to the development of integrated supply chain logistics services.
Based on the above background, the market scale of integrated supply chain logistics service industry in China will reach 2 trillion yuan in 2020, and it is expected to increase to 3.2 trillion yuan in 2025, with a compound annual growth rate of 9.5%. Moreover, this market concentration is highly decentralized, and the top ten enterprises in 20 19 only account for 7.9% of the market share. In the view of Jingdong Logistics, at present, this demand is borne by many scattered logistics enterprises in the market, but the service level is seriously insufficient, which brings great opportunities to integrated supply chain solutions and logistics service providers such as Jingdong Logistics.
02 Jingdong Logistics Scheme
In the Jingdong Logistics Prospectus, the demand for integrated supply chain logistics services in many vertical fields, such as automobile, clothing, FMCG, 3C electronics, fresh food, medicine, furniture and household appliances, was also introduced.
From the perspective of growth rate, from 2020 to 2025, the growth rate of logistics expenditure in fresh, fast-moving consumer goods and clothing integrated supply chains is ahead, with 18.8%, 14.6% and 12.7% respectively. Of course, the total demand in other fields is not low. By 2025, the demand for integrated supply chain logistics services in automobile industry, 3C electronics industry, furniture and household appliances industry and pharmaceutical industry will increase to 446 billion yuan, 31600 million yuan,11700 million yuan and 60 billion yuan respectively.
However, the demand for supply chain management is quite different in each vertical subdivision field. For example, clothing with a large number of SKUs, multiple distribution levels and obvious seasonal characteristics should not only respond to the rapid changes in the tastes of end customers, but also face frequent reverse logistics challenges. The current omni-channel sales model also requires garment enterprises to manage online and offline inventory flexibly and effectively.
Another example is fast-moving consumer goods. Although it is a necessity, the demand is usually stable, but the peak-valley changes brought by various promotions also bring great challenges to production and inventory management. In order to achieve higher operating efficiency and inventory turnover rate throughout the year, enterprises need specialized integrated supply chain logistics services to help them predict orders, so as to better manage production and warehousing. Fresh food needs better cold chain logistics capability and infrastructure because of its special category, so as to shorten the distance between the place of origin and the end customers as much as possible and reduce the number of transshipment.
To this end, based on its own supply chain service capabilities, Jingdong Logistics has developed supply chain solutions for specific industries. Here, we understand the solutions of Jingdong Logistics through two types of industries.
1. FMCG
FMCG industry includes many different product categories, such as food and beverage, beauty care, personal care and packaged groceries, and each product category also has its own unique characteristics. But FMCG also has the same characteristics, such as large quantity, low cost, high turnover rate and omni-channel distribution.
Jingdong Logistics can provide omni-channel inventory management and supply chain optimization solutions for FMCG customers. In Jingdong Logistics' view, the core competitiveness of its supply chain solutions for this industry includes omni-channel inventory management, optimization of inter-warehouse inventory distribution according to business needs, shelf life monitoring, multiple modes of transportation, on-time delivery, dynamic inventory management based on prediction, and bonded warehousing.
For example, in the cooperation with Nestle, Jingdong Logistics can allocate transportation products between Nestle's factories and distribution centers by virtue of its ability to predict market demand in different regions, and deliver products directly to consumers anytime and anywhere without staying in other warehouses or sales channels of Nestle.
In addition, the technical ability of Jingdong Logistics can also make customers simplify the inventory management of a large number of SKUs. Jingdong Logistics' solution can also let customers fully understand their supply chain, such as the quantity of goods available for sale, the geographical location of goods, the remaining shelf life, and traceable transportation routes. Customers can also make better business decisions based on the data provided by Jingdong Logistics, thus greatly reducing time and other supply chain management costs.
2. Household appliances and furniture
The particularity of the size, weight and value of household appliances and furniture products makes related enterprises face special challenges in the process of fulfilling orders. For example, storage and transportation costs may be high and difficult to optimize; In warehousing, transportation, assembly and installation services, many enterprises need to hire a separate service provider, which brings difficulties to coordinate and control costs. In addition, household appliances and furniture also have the characteristics of industrial agglomeration, and the manufacturing factories are mainly concentrated in a few areas in China.
Jingdong Logistics' solution is to build some warehouses near the areas where home power plants and furniture factories are concentrated, so that customers can directly transport products to the nearest warehouse, and minimize the storage and transportation costs. Jingdong Logistics' intelligent warehouse management system, large-scale distribution network and last mile distribution service can help Jingdong Logistics to better provide comprehensive services to customers in the household appliances and furniture industries, including integrated warehouse management across sales channels, efficient and low-cost performance and scheduling, and high-quality home delivery and installation services. In addition, Jingdong Logistics also provides after-sales service. From factory to door-to-door, assembly and installation services and after-sales services, end-to-end supply chain solutions and logistics services such as Jingdong Logistics can greatly reduce customer management and performance costs.
Where are the advantages, the funds will be raised.
It is not difficult to find that many preconditions are needed to give the above-mentioned industry solutions, such as having certain infrastructure, corresponding network, corresponding scientific and technological capabilities, clarifying customer needs, and having relevant experience. Jingdong Logistics can do it because of its special growth background.
First of all, Jingdong Logistics originated from JD.COM Group. Although it has changed from enterprise logistics to logistics enterprise, it is closely related to business process. Not only stable e-commerce orders, but also in-depth business flow, even more upstream. It has accumulated proprietary technology and professional knowledge, deeply understood business processes, and designed and developed a comprehensive and integrated logistics network. From the results, Jingdong Logistics assisted JD.COM Group to keep the inventory turnover days below 40 days. In 2020, about 90% of online retail orders handled by JD.COM Group through Jingdong Logistics Network can be delivered on the day of placing the order or the next day.
Second, Jingdong Logistics has established a stable and diverse infrastructure. Intelligent storage facilities, represented by Asia No.1, have laid the foundation for efficient inventory management. The high coverage and high coordination warehousing network, integrated transportation network, distribution network, bulky network, cold chain network and cross-border network not only ensure the ultimate experience of Jingdong logistics export, but also enable it to meet the supply chain needs of all customers in one stop. By reducing the handling times and shortening the distance between goods and consumers, it not only improves the timeliness, but also brings the warehousing demand of customers' goods, and also helps them to better carry out warehousing supply chain services.
Third, strong supply chain technology. The traditional single supply chain logistics service is still labor-intensive and its automation level is relatively low. Due to the narrow business scope of a single supply chain logistics service provider, the use of data insight is limited. Comparatively speaking, JD.COM has more comprehensive logistics coverage, deeper insight, and of course greater investment in technology. In addition to the well-known cases in the industry such as Asia No.1 and unmanned warehouse, Jingdong Logistics has continuously improved its capabilities in automation, digitization and intelligent decision-making by adopting underlying technologies such as 5G, artificial intelligence, big data, cloud computing and Internet of Things. Like intelligent algorithm, it can also achieve efficient cooperation and enjoyment, and realize intelligent decision-making in sales forecasting, commodity distribution planning, supply chain network optimization and other fields.
Fourth, the increasingly rich customer base. By 2020, Jingdong Logistics has provided services to more than190,000 corporate customers, covering a wide range of industries such as FMCG, clothing, household appliances, furniture, 3C, automobiles and fresh food. By September 30, 2020, the number of customers serving Jingdong Logistics Integrated Supply Chain will reach 46,000. This large number of customers with diverse fields, on the one hand, deepened Jingdong Logistics' understanding of different industries, thus developing and improving more efficient supply chain solutions, on the other hand, improved the utilization efficiency and business operation capability of Jingdong Logistics infrastructure. With the deepening of cooperation, the relationship between Jingdong Logistics and related customers is getting closer and closer, creating a strong brand image. The future potential of Jingdong Logistics also largely depends on the growth of external customers.
According to the plan of Jingdong Logistics, the main purpose of this IPO fundraising is to consolidate and enhance its competitiveness in the supply chain, such as upgrading and expanding our logistics network, developing advanced technologies related to supply chain solutions and logistics services, and expanding the breadth and depth of solutions, deepening existing customers and attracting potential customers.
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