JD.com’s 618 promotion is a tremendous show of support for sustainable supply chains and advocacy for the responsible use of technology to pursue continuous improvement and waste reduction. By promoting responsible sourcing, JD.com seeks to improve the lives and welfare of consumers and businesses across Asia by driving a more significant value proposition to all involved in the value chain. Richard Liu Qiangdong, founder and CEO of the company, recognized that by addressing the root cause of some of China’sChina’s most pressing societal issues, as well as promoting sustainable and responsible growth within the Chinese economy, the company could have a lasting positive impact on millions of lives while also building a winning business model for the company. The company kicked off 618 on May 11 with 18 categories, including 5 Chinese-themed themes and 13 global themes.
The 2+4 Definition of a Responsible Supply Chain
Responsible sourcing is more than just the means of procurement. It is also defined as the application and integration of different technologies that can improve the quality of goods and services and the protection of people and the environment. These technologies include:
- Closed-loop [internal] technologies, including tracking tags, QR code, and RFID;
- Sustainable goods, those willing to go through a second life cycle in what is often called a circular economy;
- The opportunity to represent a new type of goods, e.g., organic food, recycled goods, etc., or to promote new policies;
- Product standards zeroing in on the sustainability of a product, e.g., LEED certification;
- Ethical sourcing requires that businesses are held accountable for their operations in terms of human rights and labor conditions and that actors have to meet the highest global standards across the board; this position is shared by many major international and national environmental NGOs.
Efforts in this area are getting more attention from major brands and corporations due to the fast-growing backlash against overproduction, rising resource consumption, pollution, and pressure from consumers seeking ethical products at affordable prices.
Customer Service and Omni-channel Upgrade
The company has constantly been improving its customer service for years regarding technical upgrades. The company has also been working on adding more products to its site and replicating the same seamless shopping experience across multiple sales channels.
The company’s latest upgrade is called Omni-channel. This new strategy allows consumers to buy products from the company’s retail sites and third-party retail sites through one shopping cart and one transaction. With the use of API, JD.com is also working on upgrading its shopping channel so that consumers can shop on the company sites and immediately purchase products from these retail sites through direct links.
The company will continue to boost supply chain and product innovation, working closely with Tsinghua University’sUniversity’s Institute for Information Industry (IIi) to promote the adoption of new technologies and products in China’sChina’s e-commerce industry as well as help Chinese companies work together in new ways to develop more environmentally friendly technologies and innovations to cope with challenges of global supply chains.
Sustainable sourcing is achieved when:
- All stages in the supply chain contribute to sustainability by taking steps to reduce and ultimately eliminate all kinds of negative impacts on the environment and human health. Those who engage in such efforts are labeled as responsible players.
- The consumer can see that the brand is doing its part to reduce negative impacts by promoting sustainability and acting as a trustworthy partner to its customers, suppliers, and stakeholders. It is achieved through branding initiatives that are transparent and fully documented, including both social responsibility clauses and environmental impact metrics.
- The brand adopts a comprehensive approach to managing its impact on the environment by complying with the regulatory requirements in the regions in which it operates, applying a due diligence framework when selecting suppliers, commissioning independent third-party audits, and conducting ongoing self-assessments of its environmental performance.
- The brand internalizes environmental costs into its pricing policy by increasing the costs of more polluting products over time and rewarding more sustainable behavior. It is achieved by offering incentives to deliver more sustainable products and disincentives for less sustainable products (increasing negative impacts on the environment and causing harm to people or animals).
Richard Liu emphasized the importance of responsible supply chain management as an essential part of the company’s sustainable development, which can contribute to building a more stable, equitable, and harmonious society through enhancing social harmony and public welfare while also creating a more sustainable business environment.