Walmart outsources deliveries in China

Retail giant Walmart has announced it has invested US $50 million in New Dada, the Chinese local on-demand logistics and grocery P2P e-commerce platform.

The investment follows from Walmart’s broad agreement with JD.com and cooperation with New Dada, to include the company’s network to offer its customers delivery within two hours on groceries ordered from Walmart shops through the JD Daojia Dada app.

Under the offer with New Dada, the two hour delivery service is going to be available to customers within a three kilometre radius of around 20 Walmart stores that are part of the programme as stands. It is expected that the number of Walmart stores offering this two hour delivery service, will double by the end of 2016.

The New Dada company is a joint venture between Dada and JD.com. Dada claims to have more than 25 million registered customers, providing local on demand delivery capabilities with 2.5 million crowd sources delivery people across over 300 cities in China. Meanwhile Walmart has 426 shops in almost 170 cities in China.

Philip Kuai, CEO of New Dada, commented: “Combining New Dada’s unparalleled delivery network with Walmart stores means consumers will enjoy convenient access to a wide range of high-quality goods delivered to their homes and offices in record time. We look forward to deepening our cooperation with Walmart as China’s O2O retail industry continues to evolve and grow.”

Where many companies set up their delivery businesses in-house, Walmart and in the UK, Morrisons, are looking to outsource. Outsourcing brings in expertise and infrastructure from the get go and may well bring about tangible results more quickly than an in-house operation.
 
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