A novel, even transformative, online shopping experience is quickly becoming the norm in China: products ordered and paid for during large-scale promotions like Single’s Day reach your doorstep within the same day or even a few minutes post-transaction.
The country’s express delivery service has witnessed an astronomical 30-fold growth in the last decade, handling over 100 billion parcels in 2022 alone. Serving as a tangible manifestation of the explosive ecommerce boom, spearheading companies like JD.com are propelling this evolution through investment in intelligent logistics.
On June 1st, China’s largest mid-year shopping festival, ‘618’, broke all previous records. Items purchased on JD.com (also known as “Jingdong”) not only surpassed the entire count from the previous year but left the warehouse for delivery in record time. As one of the largest ecommerce companies globally, JD.com now successfully manages same-day or next-day delivery for over 90% of retail orders, pushing overall inventory turnover days close to 30.
The backbone supporting these milestones is JD.com’s investment in advanced technologies. By integrating algorithms and robotics, JD.com improves customer experience, often subtly enough that they might not even realize it.
Machine learning in warehousing
High-demand shopping festivals such as 618 Grand Promotion generate tens of billions of dollars in transactions, stressing logistics systems and retailers alike. Since initiating its own logistics network in 2007, JD.com has progressively shifted from manpower-driven to automation and machine learning-based operations.
To illustrate, JD Logistics employs ‘digital twin’ technology, simulating real scenarios, predicting order volume, refining algorithms and making decisions about efficiency-improvement. In mere minutes, this technology simulates the status of hundreds of millions of packages at every fulfillment stage, facilitating accurate management of personnel, facilities, and vehicles well before the promotion kicks off. Real-time data access alerts about potential issues, saving millions in costs. Historical data consistently demonstrates an impressive alignment of over 90% between simulation predictions and actual data.
JD Logistics also harnesses big data and machine learning algorithms to predict product popularity and correlations, optimize product storage locations, and minimize cross-area picking for multi-product orders. AI-driven models create efficient pickup paths and guide packers to use optimal packaging materials, reducing waste and cost.
Complementing this systematic intelligence is JD’s deployment of robotics and automation technologies. JD’s integrated warehousing system consolidates software and hardware systems like high-speed sorting lines, AGVs (Automated Guided Vehicles), and AS/RS (Automated Storage and Retrieval System) for maximal efficiency. User-friendly design enables operation management via PC and mobile terminals.
Business intelligence in transportation
With rising consumer expectations for swift ecommerce services, consumption and transportation have become intimately linked, impacting urban planning and sustainability. Addressing this link, JD Logistics uses algorithms combined with comprehensive road network information and real-time traffic conditions to accurately plan and optimize route solutions for single or multiple shipments. Intelligent routing can accomplish in two minutes what manual methods might take hours or even days to achieve.
During the pandemic, JD.com’s smart supply chain system analyzed the warehousing network’s status with updated epidemic information in real time, recalculating and reallocating inventory distribution across the network in response to transportation restrictions and road closures. This capability not only enhances fulfillment efficiency but also offers valuable insights to industry partners and customers.
Logistics big data gives enterprise users a city-wide view of the economic situation, population size, purchasing power, preferences, commercial infrastructure, and transportation facilities, enabling superior business planning.
Leveraging the insights gleaned from logistics big data, enterprises can rapidly gain a comprehensive understanding of a city’s economic situation, population size, purchasing power, preferences, commercial infrastructure, and transportation facilities. Such a holistic, city-wide perspective empowering businesses to strategize more effectively and make informed decisions.
Automation in last-mile delivery
With labor costs on the rise and the need for reduced social logistics costs, intelligent last-mile delivery is an inevitable trend. On the last Single’s Day, JD Logistics deployed 600 autonomous outdoor delivery robots and 100 indoor delivery robots to provide last-mile delivery services, marking one of the first commercial applications of autonomous driving vehicles at scale. These vehicles, using AI models to integrate information from sensors, can recognize and avoid obstacles with a 98% accuracy rate for small items like traffic cones and fences.
The application of robots provides flexible delivery options for customers and satisfies consumers’ demands for instant delivery at a time when the on-demand retail market is skyrocketing.
In the landscape of global commerce, advanced technologies are reshaping our reality, paving the way for an era of unprecedented efficiency and convenience. The same- and next-day delivery paradigm we’ve achieved at JD.com is more than a testament to our technological prowess. It represents our dedication to elevating the customer experience, a commitment reflected in our continued pursuit of advanced logistics solutions powered by AI, machine learning, and robotics.
As we journey further into this exciting era, we embrace the responsibility to play a leading role in the industry, remaining steadfast in our quest to pioneer an efficient, sustainable, and consumer-centric future in ecommerce logistics. It’s not just about staying ahead; it’s about setting the pace, creating trends, and defining the future of the industry. At JD.com, we’re not just preparing for the future of logistics—we’re creating it.
Words by Dr. Tian He, ACM & IEEE Fellow, Vice President of JD.com and Head of Technology and Data Intelligence at JD Logistics
