JD.com, a $68 billion Chinese e-commerce and logistics company, reportedly is planning to make a move into the US market, where it hopes to challenge Amazon and get a jump on arch-rival Alibaba. It will do so, according to a Bloomberg story, by asking Walmart- an investor in the company - for initial logistics support, and by throwing as much money as necessary at the project.
“JD’s rule is that once we decide to do something we never limit the money,” says founder Richard Liu, adding, “We will continue to invest until we achieve our goal.”
The Bloomberg story says that JD.com plans to begin its efforts in Los Angeles “because of its enormous Chinese diaspora,” and plans to begin online sales in the US by the second half of this year.
The story goes on to say that JD.com “is now seeking funds to bankroll a logistics build-up to support an international expansion. JD is in final-stage discussions to sell 15 percent of its logistics arm to Tencent Holdings Ltd. and other investors in an early fundraising round … That’s a precursor to a logistics initial public offering in China or Hong Kong in about three years, Liu said, giving his most detailed outline of JD’s global push to date. The company founder wants to leapfrog Alibaba Group Holding Ltd., which like JD rode an unprecedented Chinese consumer spending boom but remains largely home-bound.”
JD would like half its revenues to eventually come from outside China, the story says.
Liu tells Bloomberg that “he worried about the increasing difficulty of penetrating a protectionist American market,” and that “he was considering multiple options for a U.S. entry, including partnerships with local companies.”
“JD’s rule is that once we decide to do something we never limit the money,” says founder Richard Liu, adding, “We will continue to invest until we achieve our goal.”
The Bloomberg story says that JD.com plans to begin its efforts in Los Angeles “because of its enormous Chinese diaspora,” and plans to begin online sales in the US by the second half of this year.
The story goes on to say that JD.com “is now seeking funds to bankroll a logistics build-up to support an international expansion. JD is in final-stage discussions to sell 15 percent of its logistics arm to Tencent Holdings Ltd. and other investors in an early fundraising round … That’s a precursor to a logistics initial public offering in China or Hong Kong in about three years, Liu said, giving his most detailed outline of JD’s global push to date. The company founder wants to leapfrog Alibaba Group Holding Ltd., which like JD rode an unprecedented Chinese consumer spending boom but remains largely home-bound.”
JD would like half its revenues to eventually come from outside China, the story says.
Liu tells Bloomberg that “he worried about the increasing difficulty of penetrating a protectionist American market,” and that “he was considering multiple options for a U.S. entry, including partnerships with local companies.”
- KC's View:
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Yikes.
There are companies out there that are dithering about how much they should invest in these sorts of initiatives, how far they should go, to what extent they should adjust traditional business models to adapt to a future that they’re not all that sure of.
The lesson of this story about JD.com may be that you can’t move too fast, can’t invest too much, can’t embrace the future too enthusiastically. Because companies like these simply want to reshape the world, and apparently are unwilling to accept any boundaries or limitations.
