JD.com goes global: coming to America in 2018
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JD.com goes global: coming to America in 2018

JD.com is China’s second-largest Ecommerce company, second only to Alibaba. And now, it’s going to be more than just a headline for western shoppers: the company is planning a U.S. entry before the year is up. The news broke last week, and sends a clear challenge to the world’s two biggest Ecommerce players, Amazon and Alibaba. JD.com is a significant player in the online retail space, and with the backing of Chinese internet giant Tencent (along with Alibaba and Baidu, one of the “Big 3” internet companies in China), no potential rival can afford to ignore it.

JD.com’s share price has risen by 76% over the past 12 months

graph 0131 jd

SOURCE: Yahoo Finance

JD.com is currently in the final stages of a fund-seeking mission to finance its international expansion. The company is concluding talks to sell 15% of its logistics business to Tencent, which already holds a stake in the smaller company. Other investors have also been involved in a funding round. JD might need that money – the company’s billionaire founder, Richard Liu, spoke at Davos during the World Economic Forum and, commenting on the move west, said: “JD’s rule is that once we decide to do something we never limit the money. We will continue to invest until we achieve our goal.”

He also said that the company hopes to make half its revenues from overseas operations within a decade. Discussing what it might look like, Liu continued: “This year, Vietnam, India, Philippines, Malaysia - every Southeast Asian country - we will come by the end of this year. Our future is we will invest in U.S. and build a warehouse fulfillment center in U.S. so you can get same-day delivery.

One thing’s for sure: Ecommerce is already the world’s most disruptive global trend – and competition is about to heat up.

Disclosure

Dominion holds JD.com, Tencent, Alibaba, and Amazon, in its Global Trends Ecommerce Fund.


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