Walmart, JD back online grocer

Chinese online grocery and delivery company Dada-JD Daojia announced on Thursday it had raised $500 million from US-based retail giant Walmart Inc and Chinese e-commerce behemoth JD in its latest round of financing.

Walmart invested $319 million in the latest fundraising, while JD invested $181 million. After this round of financing, Dada-JD Daojia said it would deepen its partnership with leading retail partners and improve supply chain efficiency via technology.

Dada-JD Daojia, which is partly owned by JD, includes two businesses. Dada is an on-demand logistics platform with operations covering more than 400 major cities across China, serving over 1.2 million merchants and 50 million individual users, with a peak of 10 million daily orders.

JD Daojia has more than 50 million registered customers and 20 million monthly active users in around 40 major cities across China. It provides a one-hour delivery service of fresh fruits and vegetables, groceries, flowers, baked goods and pharmaceutical products through partnering with retail stores.

Dada-JD Daojia's partnership with Walmart dates back to 2016 when Walmart invested $50 million, as part of its effort to bring a seamless online and offline shopping experience. At present, approximately 200 Walmart stores in 30 major Chinese cities have a presence on JD Daojia.

In the first promotional phase of the Aug 8 shopping festival launched by JD and Walmart, the online sales of Walmart generated from JD Daojia from July 24 to Aug 4 increased by 200 percent year-on-year.

"We are confident that this deeper collaboration with Dada-JD Daojia will enhance our omni-channel footprint and deliver a better online-to-offline or O2O customer experience," said Wern-Yuen Tan, president and CEO of Walmart China.

"The future of global retail is without boundaries. There will be no separation between online and offline shopping, only greater convenience, quality and selection to consumers," said Liao Jianwen, chief strategy officer of JD.

"JD was an early investor in Dada-JD Daojia, and continues its support, because we believe that its innovations will be an important part of realizing that vision," Liao added.

Yang Xu, an analyst at Beijing-based internet consultancy Analysys, said the investment will enhance Dada-JD Daojia's capability in grocery delivery efficiency, and strengthen the cooperation with retail stores to provide more delivery services.

China's e-commerce giant Alibaba Group Holding Ltd has launched Hema Xiansheng fresh food supermarkets, as part of its "new retail" strategy, which aims to seamlessly integrate online and offline shopping by enabling consumers to shop, order groceries for home delivery and eat in-store.