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Wen | Little General Wen Shi
Editor|Little General of Literature and History
In 2022, an amazing change has taken place in China's private enterprise industry - JD.com's revenue exceeded 1 trillion yuan for the first time, officially surpassing Huawei to become China's largest private enterprise.
The change is shocking.
Over the years, Huawei has been regarded as a leader and representative of China's private economy, and its technological innovation capabilities and international operation have won the hearts of the people.
But now, JD.com has surpassed Huawei in key revenue indicators, which is undoubtedly a symbolic sign that the structure and pattern of China's private economy is undergoing major changes.
So, how did JD.com accomplish this historic breakthrough?
1. Fortune Magazine List
The list of the world's top 500 companies published by Fortune magazine every year has always been eye-catching.
This year's list came out, but the results surprised many people - the ranking of Chinese communications giant Huawei fell off a cliff, from 72 last year to 111, and the first time in Huawei's history fell out of the top 100.
Previously, many experts predicted that Huawei is expected to enter the top ten of the global top 500. The main reason for Huawei to suffer such a Waterloo is the severe sanctions imposed by the United States.
In order to crack down on Huawei, the US government banned the sale of chips to Huawei, resulting in Huawei's "hard to find" and a sharp decline in performance.
In sharp contrast to Huawei, JD.com Group successfully entered the 52nd place in the global top 500 with an annual revenue of more than one trillion, and even overtook Alibaba to become a new benchmark for Chinese private enterprises.
When it comes to Liu Qiangdong, the first thing that comes to mind is his promise to give every JD.com employee a suite.
This seemingly empty promise has become the epitome of Liu Qiangdong's lecture on qi management.
In the wave of layoffs in many enterprises, Liu Qiangdong not only fully paid five insurances and one housing fund for employees, but also set up a rescue fund to ensure the education of employees' children.
After an employee's unexpected death, JD.com will also sponsor his children until they graduate from college. These measures make employees feel the warmth of the enterprise, and they are also the embodiment of Liu Qiangdong's emphasis on righteousness.
Liu Qiangdong's emphasis on righteousness is related to his early experience.
Second, from poor boy to entrepreneur
In 1974, in a remote mountain village in Suqian, Jiangsu, Liu Qiangdong came to this world.
No one expected that this unknown poor boy would achieve great things decades later, and the title of the giant of the times was constantly imposed on him.
Liu Qiangdong spent his childhood in extreme poverty, and his family was poor, and he was often awakened by hunger when he slept at night.
A mouthful of steamed buns has to be broken in half to have enough for the whole family to eat, and scooping a spoonful of white water to temporarily fill the hunger, this is the portrayal of Liu Qiangdong as a child.
What is even more embarrassing is that Liu Qiangdong's family can't eat enough all year round, not to mention meat, even steamed buns often can't afford to eat.
Such a difficult situation did not destroy Liu Qiangdong's dream, on the contrary, the hardships of the outside world only made him stronger.
In Liu Qiangdong's memory, every New Year, what he is most looking forward to is the arrival of his grandmother. In order to subsidize the life of Liu Qiangdong's family, my grandmother would work hard to earn some fat back home, and the family survived one cold winter after another by relying on the fat earned by my grandmother.
However, not far away, the scene of the village chief's house contrasted sharply with the Liu family, and the fragrant meat dishes and the tempting aroma emitted could always attract the little Liu Qiangdong to linger.
The first impression of Liu Qiangdong from the village chief's family was that he was "rich", which became his first life goal - to become a village chief and change his destiny.
In order to reverse the situation, Liu Qiangdong tirelessly absorbed knowledge, and he knew that only through his own efforts can he decide his life. 처 In 1992, Liu Qiangdong scored 680 points in the college entrance examination and won the city champion. This is the result of his diligence and he is one step closer to his dream.
He was admitted to the sociology major of Chinese Minmin University. A piece of news that should have been gratifying, but it plunged Liu Qiangdong's family into sadness.
They found that even selling all the pots and pans in the family could not afford Liu Qiangdong's college life.
Faced with this cruel reality, Liu Qiangdong's parents were in a dilemma. They can't bear the death of their children halfway, nor can they afford to pay for school fees. At this time, the neighbors in the village generously contributed enough to cover Liu Qiangdong's tuition and living expenses for the first semester.
Liu Qiangdong, 18, carried a bag of grain on his back and stepped onto the university campus.
The university gave Liu Qiangdong more opportunities to grow, and for the sake of ideals, he decisively transferred to the more popular computer science major at that time.
Here, he met his first love girlfriend Gong Xiaojing and also started the starting point of his career.
Soon after graduation, Liu Qiangdong found a restaurant to be transferred and invested 240,000 yuan to pocket it. Unexpectedly, Liu Qiangdong, who had just started, soon failed, not only losing money and losing his job, but also saddling huge debts.
This hit Liu Qiangdong hard, and he fell into suicidal thoughts for a while. With the encouragement of his girlfriend, Liu Qiangdong regained his strength and opened a small shop in Dongguan Village, selling CDs to make a living. In order to commemorate the love between the two, he named "Jingdong", which also became the prototype of the future Jingdong Group.
3. Humanized enterprise
But at the beginning of its business, JD.com faced a competitor that was Taobao, which was already dominant at the time. How does Liu Qiangdong make JD.com gain a firm foothold in the e-commerce industry?
In the face of strong competitors, Liu Qiangdong was not discouraged. At this time, he identified a key pain point that has long plagued the development of e-commerce - logistics.
At that time, e-commerce logistics services had problems such as slow delivery speed and packet loss and damage, which seriously affected the user's shopping experience. With a keen sense of business, Liu Qiangdong decided to build his own JD logistics to achieve "warehouse and distribution integration", so as to ensure the service quality of JD.com.
This decision is undoubtedly one of the wisest choices in Liu Qiangdong's business career. With its own logistics system, JD.com has successfully opened a survival channel around the e-commerce leader Taobao and gradually developed and grown.
In 2014, JD.com went public in the United States. Liu Qiangdong completed the legendary transformation from grassroots to billionaire.
Liu Qiangdong is not only a successful entrepreneur, but also an entrepreneur with feelings. He never forgot his roots.
When Liu Qiangdong became a billionaire years later, his first thought was his hometown.
Every festival, Liu Qiangdong would send gifts back to his hometown to help his family improve their lives. What is even more admirable is that Liu Qiangdong established a customer service center in his hometown to solve the local employment problem; building schools to improve the educational level of villagers; Improve infrastructure to make life easier for villagers. These actions all show Liu Qiangdong's deep feelings for his hometown.
Not only that, Liu Qiangdong is extremely generous to employees. JD.com's "warehouse and distribution integration" model requires the hard work of a large number of couriers.
Liu Qiangdong not only bought insurance for couriers, but also established a multi-billion yuan employee housing fund, which truly solved the worries of employees.
In 2020, when the new crown epidemic broke out, the country was in a state of shutdown, and many Internet companies laid off more than half of their employees. But Liu Qiangdong did not fire a single employee, and withstood the pressure to keep the jobs of all employees.
This move shows that he attaches great importance to his employees and is sincerely dedicated.
Fourth, the rise of JD.com
The rise of JD.com is a milestone in the history of China's private enterprise development.
As China's largest private enterprise, JD.com has made remarkable achievements.
When JD.com ranked 52nd in the list of the world's top 500 companies in 2022, the outside world only saw the amazing growth of enterprise scale and revenue, but it was difficult to imagine that JD.com started from a small bookstore and gradually developed into an e-commerce giant with global influence, and what fierce competition and change were involved in the company.
As an industry leader, JD.com has established a solid competitive advantage with its excellent e-commerce platform and supply chain management. But competitors do not easily throw in the towel, and JD.com must maintain the momentum of innovation and continue to stay ahead of its rivals.
Rapid growth has been accompanied by an expansion of the company's size. According to statistics, JD.com has now become one of the largest private enterprises in China, with about 500,000 employees and a business scope spanning multiple fields.
In order to manage this "business empire" well, JD.com faces the challenge of internal management and coordination.
As a well-known model of private enterprises in China, JD.com's influence has gone far beyond the scope of business. It sends a positive signal to the society that private enterprises can achieve excellence through their own efforts, has a strong demonstration and leading role for other start-up companies, and injects new impetus into the national economic development.
At the same time, JD.com also shoulders the responsibility of giving back to the society. How to transmit positive energy and promote social progress while pursuing business goals is a problem that JD.com needs to think about.
During the epidemic, JD.com relied on its early investment in supply chain and logistics to ensure the supply of goods and fast delivery. Its in-depth cooperation with brand owners has also made its performance steadily increase.
In the first half of this year, JD.com still achieved nearly 10% revenue growth in the context of slowing growth across the industry. At the same time, JD.com is also striving to expand new businesses and build a closed loop of "merchant + user + JD.com" business ecology, so as to obtain a more lasting competitive advantage.
It can be said that the key to JD.com's ability to surpass Huawei and become China's largest private enterprise is: first, to seize the opportunity of China's fast-growing consumption upgrading and adhere to the main business of e-commerce; The second is to deepen the supply chain and logistics and other fields to achieve differentiated competition; The third is to conform to the Internet thinking and build an open business ecosystem.
To some extent, this also reflects that the private economy is shifting from a high-input, high-risk "leapfrogging" stage to a new stage of high-quality and sustainable development.
For example, JD.com's choice of "steady and steady" and Huawei's transformation of "emerging businesses" reflect entrepreneurs' rational thinking about sustainable development. This is not only the inevitable result of China's economic development, but also the active choice of private enterprises themselves.
Of course, new challenges follow. If JD.com wants to maintain sustainable growth, it must further improve its management level and achieve optimal allocation of resources. Digital transformation, ESG sustainable development and other directions also need to be actively acted. In addition, private enterprises still need to improve their innovation capabilities and brand influence to benchmark themselves with world-class enterprises.
Fifth, the author believes
Today, as the new era begins a new journey, the rise of JD.com provides a successful model for the private economy.
The requirements for enterprises in the new era are different from those of the past. The rise of JD.com is a benchmark in the history of China's private enterprises, but past success cannot be a guarantee for further development in the future.
In the context of the new era, JD.com needs to continue to maintain strategic concentration, forge ahead, respond to various new challenges with innovation, give full play to the vitality of private enterprises, and continue to make due contributions to the development of the country.