Dada-JD Daojia raises $500 million from Walmart and JD.com

JD Daojia

Dada-JD Daojia (达达-京东到家), a Chinese online grocery and delivery company, has completed the latest round of funding, raising $500 million from Walmart and JD.com, according to the company’s press release.

“After this round of financing, Dada-JD Daojia will deepen our partnership with leading retail partners and improve supply chain efficiency via technology,” said Philip Kuai, founder and CEO of Dada-JD Daojia.

Dada-JD Daojia includes two businesses: e-commerce platform “JD Daojia” and logistics platform “Dada”. The two merged in 2016 in a $200 million deal and became a combined entity that provides delivery services to retailers, service providers and enterprises across China. The merger was described by Richard Liu Qiangdong, CEO of JD.com, as “an important step forward in building a sustainable O2O ecosystem.” The joint entity has made important strides since the tie-up: by leveraging Dada’s logistics capabilities and delivery network of over 100,000 retail stores, JD Daojia provides one-hour delivery service of a wide range of products, including fresh produce, groceries, and pharmaceutical products.

“There will be no separation between online and offline shopping, only greater convenience, quality and selection to consumers,” Jianwen Liao, Chief Strategy Officer of JD.com, stated in the fundraising announcement.

Dada-JD Daojia’s partnership with Walmart goes back to 2016, when the two companies decided to explore strategic opportunities in e-commerce. According to the company, approximately 200 Walmart stores across 30 cities in China have a presence on JD Daojia’s platform.

President and CEO of Walmart China Wern-Yuen Tan said, “By working with strong partners, and investing in digital capabilities, we will create easier and more convenient shopping experiences for customers. We are confident that this deeper collaboration with Dada-JD Daojia will enhance our omni-channel footprint and deliver a better O2O customer experience.”

Alibaba to roll out Hema Xiansheng 2.0

Tencent-backed JD.com’s recent move to consolidate its dominance in China O2O grocery delivery sector is perhaps motivated by the increasing competition from Alibaba, who announced in June new ambitious plans to integrate its new retail technology in 400 RT Mart stores within its grocery and food delivery network in China by the end of this year. The e-commerce giant is also devoting more resources to Hema supermarket in hope to boost its O2O delivery services.