Be the connection line of the industrial Internet and the foundation builder of the social supply chain.
Author|Dou Dou
Produced | Industrialist
An automatic vertical warehouse with a height of 16 meters, forklifts shuttle back and forth, and boxes are neatly put into the warehouse... This is the scene in the Shuzhi Logistics Industrial Park in Pingyi, Linyi City, Shandong Province.
Pingyi on the southern edge of Yimeng Mountain is the "hometown of honeysuckle in China" and "the capital of canned fruit in China". In the Internet age, Pingyi has been actively embracing e-commerce. However, in the process of e-commerce development, the pain points and difficulties that restrict the development of e-commerce such as small, scattered and chaotic logistics systems have become more and more obvious.
First enter the Jinan warehouse, and then deliver to the southern Shandong area. This is the previous local logistics model, with high logistics costs and weak delivery timeliness. Based on this, finding modern logistics enterprises, building a higher-level logistics network, and driving the development of industrial belts and regional economies has become a top priority for the local government.
JD Logistics is the successor of this strong pain point.
After the Pingyi Digital Logistics Industrial Park built by JD Logistics was put into operation, local manufacturers realized the nearest warehousing, the delivery time was improved by more than one day, and the logistics cost dropped by more than 50%, which greatly shortened the uplink of agricultural products and the downlink of industrial products in Pingyi County. distance, to achieve delivery in southern Shandong and northern Jiangsu within 12 hours and reach the Yangtze River Delta region within 24 hours.
This is just a microcosm of JD Logistics.
In the past few years, this logistics company has increasingly appeared in the sinking industrial belt and more industrial entity scenes, and is responsible for the construction and digital reconstruction of the logistics and warehousing system.
On March 9, JD Logistics released its first annual performance report after listing. According to the financial report, the total revenue of JD Logistics in 2021 will reach 104.7 billion yuan, a year-on-year increase of 42.7%, of which revenue from external customers will reach 59.1 billion yuan, a year-on-year increase of 72.7%, accounting for 56.5% of the total revenue.
Based on the extension of this figure, JD Logistics has exceeded the strategic goal of "over 100 billion in five-year revenue and more than half of external customer revenue" formulated when it officially became independent in 2017 ahead of schedule.
This is an eye-catching financial report.
Behind the financial report, several questions that need to be answered are: In addition to numbers, what did JD Logistics do right after declaring independence for 5 years? In addition, what is the real value of logistics companies at the moment when industrial digitalization is entering the deep water area?
1. The dilemma of "aggregation" in the logistics industry
China is the largest e-commerce market and the largest logistics market in the world.
According to the CIC report, the national logistics cost will reach 14.9 trillion yuan in 2020. In the past five years, that is, during 2015-2020, the industry's compound annual growth rate was 6.5%. The report predicts that the compound annual growth rate of logistics costs in 2020-2025 will be 5.3%.
This is a blue ocean that is large enough and the growth trend is becoming more and more obvious.
But the problem still exists. That is to say, despite the large scale of the logistics market, due to the late start of the domestic logistics market, the logistics links are redundant. Therefore, compared with developed countries in the world, there are still many problems such as high cost, low efficiency, and serious shortage of mid-to-high-end, systematic, and intensive logistics services and supply chain services.
For example, in the manufacturing industry, competition has always been fierce. Material costs usually account for more than 50% of manufacturing costs. Therefore, material and warehouse management and cost control have become key factors affecting market competitiveness and are inseparable from corporate benefits.
One of the current situations is that the appeal of most production companies is to outsource all warehousing and transportation to third-party logistics companies, which can help them carry out "aggregated" warehousing and logistics management. But in many cases, it is impossible to find a suitable and powerful logistics service provider.
The reason is mainly because China's logistics companies are relatively scattered. According to relevant data, the top ten companies are mainly logistics subsidiaries of large companies, accounting for only 9.0% of the market share. The needs of the current manufacturing industry are undertaken by many scattered logistics companies in the market, and it is difficult to establish an efficient and complete service closed loop among them.
For another example, in recent years, domestic logistics companies have spent a lot of effort on the last mile, such as self-pickup points, stores, convenience stores, joint distribution, Internet city logistics, etc. Enterprises seem to think that the last mile is the pain point. Various nodes such as hardware and software are constantly iteratively upgraded, and they are desperately planning and solving.
However, after advancing like a raging fire, we found that this is not the root of the problem. The root is that the needs of users are becoming more diversified, randomized, and fragmented. The core is that the way of commercial logistics is changing.
It is no exaggeration to say that as consumers and enterprises have higher and higher requirements for logistics, the efficiency improvement of a single link is no longer enough to meet the current needs. In addition to the improvement of individual links, the logistics industry needs more integrated services.
More essentially, this kind of aggregated service needs to run through from warehousing logistics to the last mile of distribution, helping enterprises to undertake the second half of the "consumer experience".
2. Looking for an "integrated supply chain"
Yubei Xiaobaodang in Shenmu City, Shaanxi Province is a mining company under the Shaanxi Coal Group, covering an area of nearly 3,500 square meters. Since 2017, Xiaobaodang has transformed from a desert into a modern mine.
However, under the guidance of the revolutionary concept of "Industry 4.0", a new round of challenges has also ushered in here.
Material control is an important part of reducing production costs. The more process links, the greater the capital investment, and the more waste of manpower and inventory. However, due to the particularity of the coal mining industry, in Xiaobaodang, dozens of staff are needed just to be responsible for material inventory, storage and other material storage areas.
"Common consumables needed for operations must be reported to the plan in advance and then used in the warehouse of the material management center. If there is too much planning, there will be a backlog of materials, and if there is little planning, it may affect normal use." As a staff member of Yubei Xiaobaodang Mining Company, Ke Yin understands this deeply.
In other words, supply chain management has become a core issue in the development of Xiaobaodang. Based on this, they found JD Logistics.
JD Logistics has created a WMS warehouse management system for Yubei Xiaobaodang Mining Company by using new material management technologies such as the Internet of Things and face recognition. Able to provide professional services for material supply centering on warehousing data, intelligent replenishment and other directions.
In addition, due to the long industrial chain and high complexity of the coal energy industry, logistics runs through all links of the entire industrial chain. The four core scenarios of procurement, warehousing, logistics, and parks in the coal energy industry are also the pain points of its logistics. Based on this, JD Logistics has created a supply chain scenario-based service model of "consulting + technology + operation" to provide multi-dimensional digital solutions for Xiaobaodang.
Today, Yubei Xiaobao is a worker in a mining company, and more than one-third of his working time is spent dealing with intelligent equipment. Ke Xiangang introduced, "Due to the wide application of intelligent systems and equipment, not only the number of personnel in the material station has been reduced, but also more requirements have been placed on everyone's skills."
This new supply chain paradigm integrating industry and technology is the answer given by JD Logistics.
"Providing enterprises with the optimal solution of a technology-driven integrated supply chain is the future direction." Yu Rui, CEO of JD Logistics, believes that the biggest challenges and changes that JD Logistics will face in the future must be brought about by technology.
The integrated supply chain, more specifically, is through the trinity of "hardware", "software" and "system integration", and then aggregated into a supply chain solution covering the entire end of warehousing and logistics. It is understood that as of now, JD Logistics has formed technical products covering key links in the supply chain such as parks, warehousing, sorting, transportation, and distribution.
Driven by the capabilities of the integrated supply chain, JD Logistics is also updating the new standards of the logistics industry. Taking fast logistics experience guarantee as an example, one data is that with the help of JD Logistics, JD Group has reduced the inventory turnover days of millions of SKUs through over 1,300 warehouses while serving more than 500 million consumers. By 30.3 days in the fourth quarter of 2021, it will reach a world-class level.
Another example is accurate sorting and distribution guarantee and safe supply chain logistics guarantee. JD Logistics can help customers manage intelligent and reasonable supply chains during the big promotion period through Jinghui platform, smart business warehouses and other products. It can realize efficient and accurate "last mile" delivery.
According to the data, since the launch of JD Logistics Shanghai Asia No. 1 in 2014, JD Logistics has deployed 43 Asia No. 1 smart logistics parks across the country. This is the largest intelligent warehouse group in the field of e-commerce logistics in Asia.
It is not difficult to see that JD Logistics has established a complete set of modern supply chain management that integrates industries and technologies, whether it is from the front-end management and sales supply chain management, or the intermediate warehousing and transfer, or the last mile intelligent distribution. plan.
It can also be seen that the core barriers and service advantages of this "heavy investment" are also being seen by the industry, which is also the core reason for the continuous growth of JD Logistics' external customer revenue in this financial report.
3. Behind the "decoupling", reevaluate JD Logistics
As mentioned above, in addition to the inherent big benchmark customer cases, the identity of JD Logistics has appeared in more and more segmented scenarios and industries in the past two years, that is, it is not only releasing its own core value, but also In creating the long tail service effect of an enterprise.
The key is the "decoupling" strategy of JD Logistics.
From the perspective of the general background, in more than ten years of supply chain infrastructure construction and technology precipitation, JD Logistics has established profound business insight into multiple industries such as FMCG, apparel, 3C, home appliances, automobiles, and fresh food.
Therefore, when serving mid-tier customers and even small and micro customers, JD Logistics can turn customized solutions for top customers into smaller modules and different components. In short, it is to disassemble the industry solutions of major customers and build them up like building blocks. The building blocks can be components of the supply chain middle platform, or they can be data algorithm middle platform and cloud warehouse and other systems. At present, JD Logistics has created and exported standardized solutions in eight subdivided fields, including FMCG, apparel, and 3C.
Take Minjiu.com as an example. It is a well-known omni-channel operator of liquor in the country. However, due to the pain points of high damage rate of liquor transportation and high timeliness requirements, it has higher requirements for the management efficiency of the whole supply chain, such as warehousing operations and delivery timeliness. Require.
In this regard, JD Logistics "prescribes the right medicine" through the standardized solution of the fast-moving consumer industry that "resolves the root cause". On the one hand, through the integrated service of warehousing and distribution under the same warehouse of BC, Minjiu.com provides efficient and flexible multi-channel, one-in-one cargo fulfillment; on the other hand, through the intelligent supply chain system and products, the fragments in each warehouse, factory, and store Optimized inventory matches sales orders in real time.
Another example is in the apparel industry. As we all know, in the apparel industry, inventory has always been the biggest problem for companies.
Based on this, JD Logistics has created a standardized solution for the apparel industry through the "decoupling" strategy, realizing the automation and intelligence of store goods, replenishment, transfer, and return, and closed-loop decision-making management throughout the process. At the same time, by deploying the warehousing network closest to consumers, it provides customers with forward and reverse integrated supply chain logistics services, and comprehensively improves the efficiency of the supply chain network.
Another example is the 3C industry. In response to its high-experience precision contract fulfillment requirements in omni-channel consumption scenarios, JD Logistics helps its supply chain achieve end-to-end improvement by virtue of its supply chain logistics service capabilities in digital intelligence + full chain + full category.
It can be said that the "decoupling" strategy of JD Logistics is more equivalent to a senior industry master. According to the special situation of the specific industry track and the pain points of the corresponding industrial enterprises, it will extract the corresponding parts from the "equipment library" of JD Logistics and assemble them into a weapon that is suitable for a specific industry to help it overcome the challenges of warehousing and logistics. supply chain conundrum.
It is understood that based on its inherent capabilities and "decoupling" strategy, JD Logistics' business has covered more than 300,000 corporate customers and more than 1,000 production areas.
Regardless of the data, if you re-examine it from a larger perspective, it is not difficult to find that based on its own strong industrial service capabilities and "coupling" strategy, JD Logistics and the single supply chain such as platform-based and franchise-based logistics on the market The difference in logistics services is that they can have a deeper understanding of the needs and pain points of different industries based on their accumulated experience in the integrated supply chain, such as end customer needs, product characteristics of specific industries, inventory and sales cycles, etc. .
This kind of accumulation based on comprehensive data ensures that JD Logistics is capable of providing customers with comprehensive logistics services, including express delivery, vehicle and less-than-truckload transportation, "last mile" distribution, warehousing and other value-added services. Data collection, integration and analysis will also become more precise.
In fact, from outside the warehousing and logistics industry, a clearer observation is that based on the special supply chain capabilities of JD Logistics for different supply chains, the two ends of the supply chain, that is, the interactive relationship between upstream producers and downstream consumers It is becoming more transparent and efficient, which in turn can promote the circulation and operation of the entire supply chain, such as the upstream of agricultural products, the downstream of industrial products, and so on.
For JD Logistics, whether it is the first 10 years of its establishment or the 5 years since it announced its independent operation, there have always been many discussions from the outside world. But as far as the current achievements are concerned, this enterprise that has always been "rooted in the soil" has completely transformed, and is contributing a force that cannot be ignored to the industry and the Chinese industrial model.
It may be possible to answer the question raised at the beginning of the article, that is, "what is the value of a logistics company", and the best answer may be: to be the connection line of the industrial Internet and to be the foundation builder of the social supply chain.