JD.com shortlisted five couriers, and then the backlash starts

By recommending the use of only a handful of courier service providers for its platform, JD.com is facing an angry backlash from excluded providers

PUBLISHED : Wednesday, 26 July, 2017, 8:33am
UPDATED : Thursday, 27 July, 2017, 7:51am

One of China’s biggest e-commerce players and one of its biggest offline retailers are locked in a battle over the use of courier service providers.

JD.com, China’s second largest e-commerce player after Alibaba Group Holding, has earned the wrath of Suning Group, whose Tiantian Express was removed from JD.com’s platform as a shipping option.

In its overhaul of courier service providers to eliminate the “unqualified” ones, JD.com has also recommended to merchants who sell goods on its platform in a notice on Monday, to work with five couriers from the end of this month. They are the company’s JD Express, SF Express, ZTO Express, Yunda Express and STO Express.

Although JD.com said providers not recommended could still be used as a shipping option and using them would not lower the merchants’ ranking on its platform, it stressed that the quality of delivery was crucial in an increasingly consumer experience-driven market.

The notice came after an announcement last week in which JD.com removed Tiantian as a shipping option. The provider was ranked last in a comprehensive assessment on all players by service quality and customer satisfaction for the first half of the year, said JD.com in a statement.

Suning paid 3 billion yuan for a 70-per cent stake in Tiantian at the end of 2016.

Sun Weimin, the vice-chairman of Suning Commerce Group, alleged in a post on his Sina Weibo account that Tiantian’s removal was due to the direct competition between JD.com and Suning.

He conceded that while Tiantian was not China’s largest or fastest provider, it was a competitive player, whose service quality has improved the most in the industry based on the State Post Bureau’s first-half data, with the number of complaints declining to 5.51 per 10,000 parcels.

In response, JD.com pointed out that Suning had removed Tiantian as a delivery option on its own platform, even after becoming the major shareholder.

Correspondingly, Suning has also refused to use JD Express as an option for its platform, said JD.com.

Suning is not the only infuriated vendor.

Best Express criticised JD.com for failing to provide the assessment data and explain the reason for exclusion.

Business cooperation should be built on the principles of fairness and impartiality to remove any barriers to deliver quality service to achieve win-win, Best said in a statement.

Another provider, YTO Express said in a statement that the impact from being excluded was limited as JD.com only accounted for two per cent of its business.

According to the State Post Bureau’s satisfaction ranking list on Chinese delivery companies in 2016, the top three courier brands were SF Express, China Post’s Express Mail Service and ZTO Express.

YTO, fourth on the list was ahead of STO Express and Yunda Express, which ranked fifth and sixth, but were recommended by JD.com.

Best Express and Tiantian Express were in seventh and ninth places, respectively.

Alibaba owns the South China Morning Post.