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China's JD.com inches closer to Korean entry after setting up logistics centers in Gyeonggi

Published: 28 Apr. 2025, 11:09

JD.com's Icheon logistics center in Icheon, Gyeonggi [YONHAP]

Chinese e-commerce giant JD.com, often called the "Amazon of China," has moved closer to entering the Korean market, setting up logistics centers in Incheon and Icheon, Gyeonggi.

The company, ranked alongside Alibaba and Pinduoduo as one of China’s top three e-commerce players, launched a service for global sellers on Thursday, according to JD Logistics, an affiliate of JD.com.

JD.com now handles logistics for several U.S. consumer brands, Korean beauty firms and pet commerce companies, with its 12-hour delivery services already operating in Seoul and parts of Gyeonggi.

This marks the first time a Chinese e-commerce platform has directly operated logistics centers in Korea. Analysts view the move as a likely prelude to JD.com's full-scale e-commerce entry into the market.

Building a logistics network

JD.com, founded in 1998 in Beijing’s Zhongguancun area, started as a small electronics shop before growing into one of China’s largest retailers.

Founder Richard Liu Qiangdong is considered a pioneer of China’s "new retail" movement, blurring the lines between online and offline commerce.

JD.com's delivery vehicle [JOONGANG ILBO]

Much like its earlier expansions into Thailand and Indonesia, JD.com is building logistics infrastructure first, a strategy it often uses before launching its online retail services.

The company’s Korean logistics operation could serve as a critical stepping stone for a larger push into the domestic e-commerce sector, which is already highly competitive.

JD.com was also listed on the Nasdaq in 2014. It ranked 47th on Fortune magazine’s Global 500 list last year, while Coupang ranked 168th on the U.S. 500 list.

JD.com’s revenue last year reached 1.16 trillion yuan ($162.4 billion), about five times that of Coupang’s 41.3 trillion won ($28.7 billion).

A different kind of Chinese e-commerce player

If JD.com launches full operations in Korea, it is expected to pursue a different model from earlier Chinese entrants like AliExpress and Temu.

One key difference is trust. Unlike other platforms often criticized for counterfeit goods, JD.com has built its reputation on guaranteeing authentic products.

The company inspects merchandise directly and promises to compensate customers 10 times the purchase price if counterfeit products are found.

This policy is possible because JD.com, like Amazon and Coupang, operates on a direct purchase model rather than a third-party marketplace structure.

In Korea, where trust remains a critical factor in e-commerce, JD.com could leverage this strength to overcome skepticism about Chinese platforms.

Faster delivery through technology

JD.com also offers standout delivery speeds. In China, the company operates a dense network of regional warehouses that enables same-day and next-day delivery, even across vast distances.

JD.com's autonomous delivery vehicle [JD.COM]

The company uses big data to predict regional order trends and stock warehouses accordingly. During China’s largest shopping festival, Singles' Day, JD.com maintained one-day delivery despite overwhelming demand.

In remote areas, the company deploys drones, and in congested urban centers, it uses autonomous robots to make prompt deliveries.

Focus on high-value products

While platforms like Alibaba and Pinduoduo emphasize fresh foods and mass consumer goods, JD.com has carved out a stronghold in premium categories such as electronics and home appliances.

This specialization could give JD.com an edge in Korea, where Chinese brands like TCL televisions, Roborock vacuum cleaners and Xiaomi air purifiers are already gaining traction through big-box stores and home shopping channels.

By providing authentic Chinese electronics at competitive prices, JD.com could further expand Chinese brands’ presence in the Korean market.

Challenges ahead

Chinese companies are facing a sharp slowdown in domestic demand, making expansion into global markets increasingly urgent.

Adding to the pressure, U.S. tariffs imposed under President Donald Trump have effectively closed off access to the American market for many Chinese products.

JD.com, which had pursued overseas expansion early on, entered Southeast Asian markets such as Thailand in 2015, introducing drone deliveries and same-day shipping. But it failed to achieve significant results and withdrew from the region in 2023.

JD.com's delivery drone [JD.COM]

In this context, Korea’s highly developed e-commerce market could appear attractive to JD.com. The company has already established a Korean subsidiary in 2018 to manage cross-border sellers.

“There are already cases where negative perceptions of Chinese products have been overcome through product quality, such as with Roborock’s robot vacuum cleaners,” said Jeon Byung-seo, head of the China Economic and Finance Research Institute.

But securing logistics hubs in the Seoul metropolitan area could prove difficult.

"To enhance logistics efficiency, JD.com would need to secure prime real estate, but there are very few sites left," a distribution industry source said. "It will take considerable time to build an effective network, so it is too early to worry about JD.com's impact."

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.