Walmart inks deal with JD.com to grow e-commerce operations in China

Internet Retailing

21st Jun 2016

Walmart has entered a strategic partnership with Chinese e-commerce giant JD.com.

Walmart will sell its Chinese e-commerce business, Yihaodian, to JD.com in return for a 5 per cent equity stake in JD.com.

“We’re excited about teaming up with such a strong leader in JD.com, and the potential that this new relationship creates for customers in China, as well as for our businesses,” said Doug McMillon, president and CEO of Walmart.

JD.com will take ownership of the Yihaodian marketplace platform assets, including the Yihaodian brand, website and app. Walmart will continue to operate the Yihaodian direct sales business and will be a seller on the Yihaodian marketplace, leveraging its global supply chain to provide customers a wide range of products.

As part of the deal, Walmart-owned Sam’s Club China will open a flagship store on JD.com, expanding the availability of Sam’s Club’s imported products across China. It will offer same- and next-day delivery through JD.com’s nationwide warehousing and delivery network, which covers a population of 600 million consumers.

“Sam’s Club’s unique, high-end product selection meets the demand from China’s increasing affluent consumers for high-quality, imported products and has already proven popular in the Chinese cities where it has stores. JD.com’s reputation for authentic products and superior customer experience make it an outstanding home for these iconic businesses to reach hundreds of millions more customers in China,” said Richard Liu, CEO of JD.com.

Walmart and JD.com will work together to leverage their supply chains to increase the product selection for customers across China, including broadening the range of imported products.

Walmart’s China stores will be listed as a preferred retailer on JD.com’s O2O JV Dada, a crowd-sourced delivery platform, driving online traffic to Walmart stores and allowing customers to order fresh food and other items from Walmart stores for 2-hour home delivery, while significantly broadening the product selection available to Dada’s customers. Walmart will continue to operate its own physical stores.