DHL has unveiled plans to profit from China’s booming e-commerce market with an outbound consolidation facility in Shanghai, a network of regional centres and an international logistics partnership with fast-growing leading Chinese e-retailer JD.com.
The plans were presented at a press briefing in China today coinciding with FC Bayern Munich’s Audi Summer Tour from 16 to 24 July in Beijing, Shanghai and Guangzhou, for which DHL is the official e-commerce and logistics partner, and at a JD.com event in New York yesterday.
DHL eCommerce, the group’s international e-commerce unit, said it is focusing on both cross-border and domestic e-commerce services with the launch of a new DHL eCommerce Shanghai Terminal located in Jiuting and plans to launch additional drop off centres in North and South China by the end of 2015 to benefit manufacturers in China.
The new terminal in Shanghai is a dedicated facility for DHL eCommerce to tap on the burgeoning e-commerce sector in China. The facility functions as the central point of consolidation of e-commerce goods from China for global distribution. The company already operates its own centre out of Hong Kong, but establishing a base in Shanghai will help reduce transit time by up to three days for manufacturers, particularly in eastern and northern China.
Thomas Kipp, CEO, DHL eCommerce, said: “We’re excited by China’s e-commerce sector where the trade volume in the first five months of 2015 was already equal to the whole of 2014. With about 95% of outbound logistics volume expected to come from nine provinces, we will continue to invest to grow our footprint in China and support the rising market demand.
“By the end of the year, the Shanghai Terminal will be complemented by a network of drop-off centres in North and South China. These centres will help provide regional consolidation of the large volumes, aggregating the shipments before they move to the Shanghai Terminal for final distribution around the world,” he explained.
DHL said its six-year strategic partnership with FC Bayern Munich, Germany’s most successful football team and one of the world’s leading clubs, has provided the logistics company a key platform to showcase and grow its capabilities in the e-commerce sector. DHL is the club’s official platinum partner and new international logistics and e-commerce full-service partner.
According to FC Bayern Munich, the Summer Tour has generated a significant spike in interest and transactions in the club’s online flagship store, its first international online store outside Germany. Launched in May on Tmall Global, an overseas platform and an extension of Alibaba Group’s B2C Tmall business in China, the FC Bayern Munich’s online flagship store offers a range of the team’s merchandise, including the 2015/16 home jersey, ready to be shipped by DHL eCommerce to fans in China.
In parallel, DHL Global Forwarding has won a major logistics deal with JD.com as the preferred logistics service provider for moving American products ordered on JD.com’s new ‘US Mall’, which was unveiled in New York yesterday, to and across China.
This new channel on the JD Worldwide cross-border platform is dedicated exclusively to offering authentic imported US products for sale to customers in China. It will feature authentic products from top-selling singer Taylor Swift, including a line of clothes that the artist is designing exclusively for JD.com customers.
The Chinese e-retailer’s founder and CEO Richard Liu said at the event: “As American companies increasingly understand our core advantages of zero tolerance towards counterfeits and unparalleled same-day delivery capabilities, we are gaining excellent momentum attracting US brands to our site. Chinese consumers appreciate that the United States is a global leader in the areas of product reputation, quality, reliability and variety of goods, and American companies are clearly benefiting from this unprecedented market opportunity.”
He added: “We couldn’t be happier to be working with DHL, a brand synonymous with superior international logistics, to help get these products into the hands of Chinese consumers with the speed and reliability our customers have come to expect.”
Alfred Goh, Senior Vice President & Global Head, Fast Growing Enterprises, DHL Customer Solutions and Innovation, said: “With our full suite of logistics solutions, DHL is well positioned to provide Chinese consumers with easy access to U.S.-made products, while improving overall supply chain efficiency for the retailers. All consumers globally expect their orders to arrive promptly and our extensive network and reliability will help JD.com extend quality service to its customers.”
The US Mall is the fifth ‘national’ sales channel on the JD Worldwide platform after Australia, France, Japan and Korea, and other countries will follow based on customer demand in China. The platform is designed to enable global suppliers to sell imported products to customers in China, with a simplified handling process for cross-border transactions, including recommendations on operational and international logistics partners.
For the ‘Australia Mall’, JD.com is working with Australia Post which is providing services including collections, warehousing, air and sea transportation, and small package direct mail from Australia to China.
JD.com describes itself as the largest online direct sales company in China and claims to run the largest fulfilment infrastructure of any e-commerce company in China. The group operates 7 fulfilment centres and 143 warehouses in 43 cities, along with 3,539 delivery stations and pickup stations in 1,961 counties and districts across the country, staffed by its own employees. The company provides standard same-day delivery in more than 130 counties and districts, and standard next-day delivery in more than another 850 counties and districts across China.
In 2014, JD.com sold goods worth RMBB 260 billion (US$42 billion), double the previous year’s figure, and increased its net revenues by 66% to RMB 115 billion (US$18.5 billion). The company more than doubled the number of fulfilled orders (products and services) to 689 million.
