The JD.com logistics arm, JD Logistics, has experienced an increase in revenue to 91% year-over-year during its first quarter, according to Supply Chain Dive.
According to executives in a first-quarter earnings call, the figure for revenue growth also included unspecified “other services.” It is thought that the carrier has been able to look after a greater number of orders due to technological improvements.
It is believed that the original aim was to build more logistics capacity that exceeds the demand and wait for the demand to follow suit. CFO Sidney Huang commented: “We essentially built out very large capacity ahead of time to ensure that new customers can enjoy the best experience.”
With JD’s gross profit margin up from 6.4% on the whole, JD.com experienced a rise in its profit to $1.1bn during its first quarter as it made up for its $363mn in losses last year.
In a call, Huang said: “The new changes are designed to better incentivize our delivery staff in light of our expanding business lines and industry best practices. In fact, the majority of our delivery staff affected by the new incentive scheme, so their monthly income increased in April while their productivity also improved.”