On June 17, Richard Liu made a rare public appearance at JD.com’s headquarters in Beijing’s Yizhuang district. During an intimate media gathering, Liu reflected on JD.com’s past, examined its present, and sketched out its future: what it wants to build, how it intends to make money, and what must change. His remarks revealed a complex emotional landscape: pride, regret, and ambition.
Since March, JD.com has launched new efforts in food delivery, travel, and hospitality. It has even been rumored to be entering the ride-hailing business. Its aggressive push into multiple verticals has seemed frenetic to some. But Liu’s explanation offered clarity. JD.com’s expansion remains anchored in its core logic: deepening its presence along the supply chain. Around this backbone, it is developing seven to eight distinct business units, alongside an internationalization strategy.
At the center of Liu’s address was one word: innovation. On this point, he offered a scathing critique of JD.com’s recent past, defining the past five years as a period of decline marked by a lack of innovation, growth, and progress.
So what does innovation mean to JD.com now?
According to Liu, it means rebuilding the supply chain. From its early days in self-operated retail and logistics to its current expansion into food delivery, hospitality, and even medical aesthetics, Liu emphasized a consistent through line: “My whole life has revolved around the supply chain.”
This year marks Liu’s third year since returning to JD.com. “The company no longer belongs to any one person,” he said. Liu rejoined the company at the request of current CEO Sandy Xu. “She had never worked in retail or e-commerce, and she was candid about it. She said she needs me to be fully involved until she finds her footing, and then I can step back.”
Until then, Liu remains the spiritual anchor of JD.com. His presence is felt across all of its major decisions, from e-commerce to food delivery, from travel to global expansion.
From his remarks, 36Kr curated 20 key takeaways that shed light on Liu’s thinking and the future he envisions for JD.com.
The following transcript has been edited and consolidated for brevity and clarity.
1. Not the right time to invite Meituan’s CEO for drinks
Richard Liu (RL): To be honest, [Meituan CEO] Wang Xing and I are good friends. But he might be a bit upset with me these days. I asked a mutual friend recently whether I could take him out for drinks during the 618 shopping festival. That friend, who knows both sides, said it’s better to wait, that it’s not the right time. And I thought, that’s fair.
2. JD Waimai will launch a new model unlike anything Meituan offers
RL: Throughout my life, and throughout JD.com’s history, our focus has never been diversification for its own sake. Every single business we operate is designed to support the supply chain. That includes JD Waimai. Our entry into food delivery is intended to strengthen our fresh produce supply chain.
The food delivery market is massive. Within a month, JD Waimai will introduce a business model entirely different from Meituan’s. We hope it will address food safety issues more comprehensively and give consumers access to safer, value-for-money food options.
3. The food delivery bottleneck is in HR
RL: Food delivery has been around for 15 years. We entered the market on March 1. By June 15, JD.com had hired more than 120,000 full-time couriers. We’re onboarding 3,000–4,000 people a day. The real hurdle is not our ambition, it’s our human resource capacity. We simply don’t have enough recruiters.
It’s not that we’re unwilling to hire more. We just need more time.
4. Cross-selling accounts for 40% of JD.com’s new orders
RL: When customers use JD Waimai, about 40% of them end up buying from our e-commerce platform as well. So even if we lose money on delivery, it’s still cheaper than buying traffic from Douyin or Tencent.
5. JD.com wants to disrupt the hospitality sector
RL: In hospitality, JD.com is confident in its ability to disrupt the industry by creating new supply chain channels that reduce costs and deliver value.
6. Starting a division for hospitality and dining
RL: JD.com’s goal is to lower hospitality and dining business costs by up to 33%, positioning itself as a new channel partner. To support this effort, the company has created a specialized division focused on new channels.
7. Six more innovation projects are in JD.com’s pipeline
RL: Beyond hospitality and dining, JD.com is applying its supply chain model to sectors including beauty services, medical aesthetics, hospitals, and even sidewalk businesses like massage parlors. All of this aligns with JD.com’s mission of supply chain optimization. We’ve already built the hospital supply chain.
Altogether, the company expects to launch around six new innovation projects over the next 18 months.
8. There are no plans to enter the ride-hailing business
RL: Who said we’re getting into ride-hailing?
9. JD.com sees stablecoins as a strategic bet
RL: One of our key innovation projects is focused on stablecoins. We aim to obtain regulatory licenses in all major sovereign currency markets. The goal is to reduce the cost of cross-border B2B payments by 90% and shorten transfer times to ten seconds, compared to the two to four days needed for SWIFT payments today.
Once the B2B infrastructure is complete, we’ll explore expansion into consumer payments.
10 There are no new business models planned
RL: We’ve already built supply chains for seven or eight verticals. We’re not planning to create any more new business models. Instead, we’ll focus on deepening, strengthening, and globalizing the existing ones.
11. JD.com’s strategy comprises six elements
RL: In one sentence, the six elements are: local e-commerce, local infrastructure, local hiring, local sourcing, local delivery, and selling only branded goods.
Our model is nothing like Amazon’s. If we copied them, we’d have no edge.
12. Helping 1,000 Chinese brands go global
RL: JD.com is bypassing cross-border e-commerce altogether. Instead, the company has signed deals with 1,000 Chinese brands to bring them overseas.
If those 1,000 brands succeed, JD.com succeeds. Amazon doesn’t have them. Local retailers don’t have them either. If we just sell what Amazon sells, we’d have no advantage. But this will take another five years. We have to work with each brand to ensure compliance, obtain certifications, and so on. It’s a long road.
13. From 38 employees to 900,000 full-timers in 12 years
RL: In 2003, including myself, JD.com had 38 people. We made about RMB 120,000–200,000 (USD 16,800–28,000) that year. I told our staff: however many employees we have in the future, we’ll adopt the same number of orphans. As of the first quarter this year, we have 720,000 employees.
In Q2, with the addition of delivery staff, we surpassed 900,000. It’s the largest single-quarter headcount increase since our founding, with over 150,000 net new hires.
14. All P5-level employees saw their salaries doubled
RL: I don’t believe in squeezing our people. I believe in giving raises. All employees at the P5 level and above have had their salaries doubled.
15. Full-time couriers in Beijing earn over RMB 13,000 (USD 1,800) per month before taxes
RL: From the day I launched JD Logistics in 2007, we’ve paid full social benefits for every courier. In Beijing, our full-time delivery staff now earn more than RMB 13,000 (USD 1,820) per month, and we pay benefits based on that amount.
16. Only five layers of management separate Liu from frontline workers
RL: I’ve set a hard rule whereby as long as JD.com has fewer than two million employees, we’re only allowed five layers of management. Most companies with just a few thousand people already have six or seven layers. We only have five. That’s what a flat organization means.
17. JD.com dominates China’s home appliance market
RL: JD.com is the undisputed leader in home appliances. Gome and Suning combined aren’t even 20% of our scale. Yet our profit margin in this segment is just three to four percentage points, compared to the national average of over 10%.
Appliance brands make twice as much as we do. Back in the day, Gome and Suning made three to four times as much as the brands.
18. JD Retail operates at 10% of total cost
RL: Our core advantage is efficiency. JD Retail’s total cost of operation is just 10%, on par with Costco, Sam’s Club, Aldi, Amazon, and us. Traditional supermarkets run at 20%. Gome and Suning are at 15%. This cost discipline is what keeps us alive.
19. Keeping to a 59-day payment cycle
RL: Our inventory turns over in 30 days. For anyone who’s worked in retail, that number means everything. We believe we can bring that down to 20–25 days. Each day saved generates RMB 10 billion (USD 1.4 billion) in cash flow.
Our payment cycle is 59 days. By comparison, most major retailers take 120. That’s why we don’t squeeze suppliers, and we don’t need to.
20. Net profit is 1% of GMV, and Liu is proud of that
RL: As of last year, JD.com’s GMV (gross merchandise volume) was over RMB 4 trillion (USD 560 billion). Net revenue was RMB 1.16 trillion (USD 162.4 billion). Net profit was just over RMB 40 billion (USD 5.6 billion).
We paid RMB 116.1 billion (USD 16.3 billion) in salaries. We paid RMB 18 billion (USD 2.5 billion) in social benefits last year alone, and more than RMB 100 billion (USD 14 billion) in total over the last 18 years. That could have been profit. It could have been my personal wealth. But that’s not how we operate.
Yes, we need to make money. But profit has never been our top priority. And I’ll say that anywhere.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Ren Cairu for 36Kr.