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JD.com considers food delivery business, a market almost completely controlled by Meituan and Alibaba’s Ele.me

  • The e-commerce giant’s logistics affiliate Dada Nexus said a food delivery service is ‘still in the planning stage’
  • Meituan and Alibaba together control 99 per cent of the market, but JD.com’s strength in logistics is seen as an asset

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Xin Lijun, chief executive of JD Retail, in Beijing on June 14, 2022. Xin said JD.com is exploring food delivery, a market currently dominated by Meituan and Alibaba. Photo: Bloomberg
Coco Feng
An executive at China’s second largest e-commerce firm JD.com has floated the idea of starting a food delivery service, a move that would directly challenge a market dominated by Meituan and Alibaba Group Holding.

Xin Lijun, chief executive of JD Retail, told Bloomberg News that the company was exploring a move into the business segment because Dada Nexus, JD’s logistics affiliate, has strong capabilities in same-city delivery. The launch time will depend on the company’s capacity, Xin said.

A Dada representative said that the food delivery service is “still in the planning stage”. JD declined to comment.

JD has already been in talks with some restaurants in cities like Zhengzhou, in central Henan province, and will let Dada handle the deliveries, according to a report by Chinese online media outlet LatePost earlier this month.

If JD fully commits to food delivery, its main strength will be in logistics, according to Li Yingtao, director of retail and brand analysis at market research firm Analysys. “The company has built up a comprehensive delivery system and has rich experience in it,” he said.

As an e-commerce platform, JD has long stood out for its courier services, which provide same-day delivery for certain products. The company’s local grocery delivery service JD Daojia can even get fresh food to a customer’s doorstep within an hour. By the end of 2021, JD’s delivery unit employed more than 224,000 people, making up 58 per cent of the tech giant’s total workforce.
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