JD.com built its own couriers and delivery when China's were unreliable.

JD grew out of Zhongguancun, a Beijing market where genuine goods and fakes were sold side by side, and Richard Liu decided JD would only sell authentic products bought directly from brands.

The obstacle was delivery: China's couriers were unreliable and counterfeit goods owned the market, so JD started in 2007 to build its own warehouses and delivery network, and later its own planes would not be needed for the core promise.

By holding inventory in its own warehouse and driving its own last mile, JD could check authenticity at the source, keep quality and name a delivery time it actually hit. By 2014 it had fulfilment centres in seven major Chinese cities and thousands of delivery stations.

Own the network to own the promise

Owning the warehouse keeps the goods authentic and under JD's control.

Warehouses near the customer shorten the last mile and make same-day delivery possible.

Reliable delivery builds the trust that a Chinese shopper needs to buy a phone online.

The spend deters rivals who must match a heavy capital outlay to compete.

A supply chain is a brand tool: owning it lets a firm promise speed and authenticity, then deliver on both.

JD became the largest retailer in China and built JD Logistics into a stand-alone business that later listed in Hong Kong. Its self-built network let it promise same or next day delivery on most orders, and it competed on authenticity, speed and economies of scale.