Getting products to customers in less densely populated parts of China can increase costs for companies like Alibaba, JD.com and Pinduoduo.
A key next step is to improve data collection and analysis of local demand, so JD can effectively stockpile those smaller outposts with goods for one-day delivery to the region, the company said. JD also plans to open some more warehouses in lower-tier cities.
The retailer is also looking to its delivery network as a source of income. Wang disclosed that since opening the network to third-party players in 2017, those clients now contribute to about 40% of the logistics department's revenue. He pointed out that one key way for delivery companies to lower costs is by keeping trucks full in both directions: a vehicle bringing products from an urban center to a village can then bring agriculture produce back to the city.
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