Latest news with #RichardLiu
The Star
10 hours ago
- Business
- The Star
JD.com billionaire's viral stunt reignites China's food-delivery feud
One unusually warm evening in April, Richard Liu revved his scooter through Beijing's traffic-snarled streets alongside other delivery workers, and then personally handed food orders to surprised customers. Later that night, over spicy hotpot and ice-cold beer, the Inc founder welcomed a pair of riders from two rival delivery firms to his company. The publicity stunt, broadcast on viral online videos, reignited a fight for China's US$80bil (RM340.39bil)-plus food delivery market. In just a few months, JD, China's largest online retailer by revenue, amassed 25 million daily takeout orders across 350 cities, capturing more than half the volume of Alibaba Group Holding Ltd's the runner-up to market leader Meituan. Neither saw Liu coming. China's food delivery industry has been in an effective duopoly after brutal price wars forced out many smaller players almost a decade ago. Takeout became more expensive even as merchants and riders complained about making less. Liu is now turning to an old playbook: charging restaurants no commission, generous hiring bonuses for 100,000 new full-time riders, plus a 10bil yuan (RM 5.92bil or US $1.4bil) discounting campaign for consumers. During its flagship shopping festival this month, JD sold coffee and bubble tea for as cheap as 1.68 yuan (RM1). The food delivery war is indicative of the bifurcation in China's mammoth tech industry. On the one hand, players like DeepSeek are spurring major tech firms to invest in innovations like generative AI. On the other, the effects of Beijing's yearslong Covid lockdowns and regulatory campaigns against Big Tech still linger, and many companies are desperately searching for sources of growth in a saturated market. Liu's marketing stunt is also personal. The viral videos of him waiting to pick up boxed lunches and downing beers with other riders mark a surprise return to the public eye for the 52-year-old tech mogul, who faded from the spotlight in 2018 when he was arrested in the US on suspicion of rape, though prosecutors in Minneapolis ultimately declined to press charges. During Beijing's crackdown on the tech sector in 2022, Liu joined a long list of tech founders who stepped down. His departure coincided with some of JD's toughest times since its founding as a tiny electronics outlet in 1998. Its premium online shopping service ran into China's slowing economy, its own bargain app flopped, and an overseas foray was abandoned. That left JD with no growth story, as giants Alibaba and Tencent Holdings Ltd bet big on generative AI and smaller rivals such as Meituan and Didi Global Inc exported their gig-economy models abroad. Even Meituan has begun selling and delivering everything from iPhones to washing machines in a few hours. 'For JD, it's a lost five years, to put it bluntly,' Liu said during a rare news conference at the company's Beijing headquarters Tuesday. 'No innovation, no growth, no progress. It should be considered the most unremarkable and least valuable five years in my entrepreneurial history.' Explaining their rationale of getting into food delivery, Liu said that it's about leveraging JD's battle-tested logistics network to acquire new users, 40% of whom have already been converted into e-commerce customers. 'Our losses are smaller than what we would have spent on advertising,' he said. Not everyone is convinced. JD's takeout business could generate as much as 18bil yuan (RM 10.66bil) in annualised losses, wiping out 36% of its parent's operating profit for 2025, says JPMorgan Chase & Co. Arete Research estimates that as the market leader, Meituan will only need to spend about a quarter of JD's costs to defend its position. JD's loss per order will narrow to 3 yuan (RM1.78) in the second half of 2025 from 8 yuan (RM4.74) this quarter as it pares back subsidies to confront the economic reality, the equity research house predicts. 'We do not think JD will find material success in local services like insta-commerce, but understand management's sense of urgency in needing to diversify its business mix and feeling threatened by Meituan,' Arete analysts Shawn Yang and Richard Kramer wrote in a note in June. Representatives for JD, Alibaba, and Meituan didn't respond to requests for comment for this story. What's clear is that JD has injected new life into a long-dormant market. hardest hit by JD's offensive, gave out 10bil yuan (RM 5.92bil) in subsidies to customers, then another 1bil yuan (RM 592.27mil) to restaurants. Alibaba also integrated the takeout app into its flagship e-commerce platform Taobao in the hope of diverting more traffic to it. Meituan for the first time ever is giving away vouchers on things like smartphones and liquor during the June 18 sales event that JD invented more than a decade ago. Its founder Wang Xing declared to investors in May that it would do 'whatever measure it takes to win the game'. The renewed food-delivery battle is reminiscent of the all-out war in online shopping just years ago, when alleged abuses like forcing merchants into exclusive arrangements helped fuel Beijing's Big Tech crackdown, wiping out trillions in wealth. Though pressure has eased, government scrutiny remains heightened as high youth unemployment drives more and more people to take up gig work. Regulators in May summoned executives from the three takeout firms into meetings on fair competition and protection of riders, among other topics. By 2024, China had more than 10 million delivery riders, official data showed. In Beijing, there were 17,000 riders in the first half of 2024, up 50% from a year ago. And amid growing awareness of how riders often prioritise speed over safety to earn more, said in April that it would gradually phase out a cash penalty system for riders who miss their deadlines. JD is going further in worker benefits by paying social security – a government-sponsored welfare system including pensions and medical insurance – for all of its full-time riders. Meituan and followed suit with similar policies. JD has won over riders like Jiang Xiaoxi, a migrant worker in Shenzhen who joined Meituan before Covid but quit last year to take care of her sick grandfather in her hometown in Hunan province. When the 25-year-old returned to Shenzhen this year, she picked JD instead for regular eight-hour shifts and persuaded her peers to jump ship. 'I signed a contract on day one,' she said. 'Having social security as a full-time employee gives me a sense of belonging.' Others are wary of such promises, with memories of the past delivery price-war still fresh. Tang Zequan, 36, recalls how in 2016 he could make more than 10 yuan (RM5.92) per order as a new driver for Meituan in Guangzhou. After Meituan emerged dominant, his earnings went down to 7 yuan (RM4.15) per order. As a high-school dropout, he acknowledges that no other job could have helped him pay off debts so quickly after his real estate brokerage business went under during Beijing's crackdown on the property market. 'I have great gratitude for the food delivery industry, but I won't pay allegiance to any firm,' Tang said. 'Without choices we are left with a monopoly.' – Bloomberg
Malaysian Reserve
12 hours ago
- Business
- Malaysian Reserve
JD.com billionaire's viral stunt reignites China's food-delivery feud
ONE unusually warm evening in April, Richard Liu revved his scooter through Beijing's traffic-snarled streets alongside other delivery workers, and then personally handed food orders to surprised customers. Later that night, over spicy hotpot and ice-cold beer, the Inc. founder welcomed a pair of riders from two rival delivery firms to his company. The publicity stunt, broadcast on viral online videos, reignited a fight for China's $80 billion-plus food delivery market. In just a few months, JD, China's largest online retailer by revenue, amassed 25 million daily takeout orders across 350 cities, capturing more than half the volume of Alibaba Group Holding Ltd.'s the runner-up to market leader Meituan. Neither saw Liu coming. confirmed that the viral photo posted by a Beijing user showing that the rider who delivered his food was the company's founder and Chairman Richard Liu was genuine. The Chinese e-commerce platform recently forayed into food delivery service and started a… — Yicai 第一财经 (@yicaichina) April 22, 2025 China's food delivery industry has been in an effective duopoly after brutal price wars forced out many smaller players almost a decade ago. Takeout became more expensive even as merchants and riders complained about making less. Liu is now turning to an old playbook: charging restaurants no commission, generous hiring bonuses for 100,000 new full-time riders, plus a 10 billion yuan ($1.4 billion) discounting campaign for consumers. During its flagship shopping festival this month, JD sold coffee and bubble tea for as cheap as 1.68 yuan. The food delivery war is indicative of the bifurcation in China's mammoth tech industry. On the one hand, players like DeepSeek are spurring major tech firms to invest in innovations like generative AI. On the other, the effects of Beijing's yearslong Covid lockdowns and regulatory campaigns against Big Tech still linger, and many companies are desperately searching for sources of growth in a saturated market. Liu's marketing stunt is also personal. The viral videos of him waiting to pick up boxed lunches and downing beers with other riders mark a surprise return to the public eye for the 52-year-old tech mogul, who faded from the spotlight in 2018 when he was arrested in the US on suspicion of rape, though prosecutors in Minneapolis ultimately declined to press charges. During Beijing's crackdown on the tech sector in 2022, Liu joined a long list of tech founders who stepped down. His departure coincided with some of JD's toughest times since its founding as a tiny electronics outlet in 1998. Its premium online shopping service ran into China's slowing economy, its own bargain app flopped, and an overseas foray was abandoned. That left JD with no growth story, as giants Alibaba and Tencent Holdings Ltd. bet big on generative AI and smaller rivals such as Meituan and Didi Global Inc. exported their gig-economy models abroad. Even Meituan has begun selling and delivering everything from iPhones to washing machines in a few hours. 'For JD, it's a lost five years, to put it bluntly,' Liu said during a rare news conference at the company's Beijing headquarters Tuesday. 'No innovation, no growth, no progress. It should be considered the most unremarkable and least valuable five years in my entrepreneurial history.' Explaining their rationale of getting into food delivery, Liu said that it's about leveraging JD's battle-tested logistics network to acquire new users, 40% of whom have already been converted into e-commerce customers. 'Our losses are smaller than what we would have spent on advertising,' he said. Not everyone is convinced. JD's takeout business could generate as much as 18 billion yuan in annualized losses, wiping out 36% of its parent's operating profit for 2025, says JPMorgan Chase & Co.. Arete Research estimates that as the market leader, Meituan will only need to spend about a quarter of JD's costs to defend its position. JD's loss per order will narrow to 3 yuan in the second half of 2025 from 8 yuan this quarter as it pares back subsidies to confront the economic reality, the equity research house predicts. 'We do not think JD will find material success in local services like insta-commerce, but understand management's sense of urgency in needing to diversify its business mix and feeling threatened by Meituan,' Arete analysts Shawn Yang and Richard Kramer wrote in a note in June. Representatives for JD, Alibaba, and Meituan didn't respond to requests for comment for this story. What's clear is that JD has injected new life into a long-dormant market. hardest hit by JD's offensive, gave out 10 billion yuan in subsidies to customers, then another 1 billion yuan to restaurants. Alibaba also integrated the takeout app into its flagship e-commerce platform Taobao in the hope of diverting more traffic to it. Meituan for the first time ever is giving away vouchers on things like smartphones and liquor during the June 18 sales event that JD invented more than a decade ago. Its founder Wang Xing declared to investors in May that it would do 'whatever measure it takes to win the game.' The renewed food-delivery battle is reminiscent of the all-out war in online shopping just years ago, when alleged abuses like forcing merchants into exclusive arrangements helped fuel Beijing's Big Tech crackdown, wiping out trillions in wealth. Though pressure has eased, government scrutiny remains heightened as high youth unemployment drives more and more people to take up gig work. Regulators in May summoned executives from the three takeout firms into meetings on fair competition and protection of riders, among other topics. By 2024, China had more than 10 million delivery riders, official data showed. In Beijing, there were 17,000 riders in the first half of 2024, up 50% from a year ago. And amid growing awareness of how riders often prioritize speed over safety to earn more, said in April that it would gradually phase out a cash penalty system for riders who miss their deadlines. JD is going further in worker benefits by paying social security — a government-sponsored welfare system including pensions and medical insurance — for all of its full-time riders. Meituan and followed suit with similar policies. JD has won over riders like Jiang Xiaoxi, a migrant worker in Shenzhen who joined Meituan before Covid but quit last year to take care of her sick grandfather in her hometown in Hunan province. When the 25-year-old returned to Shenzhen this year, she picked JD instead for regular eight-hour shifts and persuaded her peers to jump ship. 'I signed a contract on day one,' she said. 'Having social security as a full-time employee gives me a sense of belonging.' Others are wary of such promises, with memories of the past delivery price-war still fresh. Tang Zequan, 36, recalls how in 2016 he could make more than 10 yuan per order as a new driver for Meituan in Guangzhou. After Meituan emerged dominant, his earnings went down to 7 yuan per order. As a high-school dropout, he acknowledges that no other job could have helped him pay off debts so quickly after his real estate brokerage business went under during Beijing's crackdown on the property market. 'I have great gratitude for the food delivery industry, but I won't pay allegiance to any firm,' Tang said. 'Without choices we are left with a monopoly.' –BLOOMBERG
Straits Times
15 hours ago
- Business
- Straits Times
JD.com billionaire's viral stunt reignites China's food delivery feud
BEIJING – One unusually warm evening in April, Richard Liu revved his scooter through Beijing's traffic-snarled streets alongside other delivery workers, and then personally handed food orders to surprised customers. Later that night, over spicy hotpot and ice-cold beer, the founder welcomed a pair of riders from two rival delivery firms to his company. The publicity stunt, broadcast on viral online videos, reignited a fight for China's US$80 billion (S$102.9 billion)-plus food delivery market. In just a few months, JD, China's largest online retailer by revenue, amassed 25 million daily takeout orders across 350 cities, capturing more than half the volume of Alibaba Group Holding's the runner-up to market leader Meituan. Neither saw Mr Liu coming. China's food delivery industry has been in an effective duopoly after brutal price wars forced out many smaller players almost a decade ago. Takeout became more expensive even as merchants and riders complained about making less. Mr Liu is now turning to an old playbook: charging restaurants no commission, generous hiring bonuses for 100,000 new full-time riders, plus a 10 billion yuan (S$1.8 billion) discounting campaign for consumers. During its flagship shopping festival this month, JD sold coffee and bubble tea for as cheap as 1.68 yuan. The food delivery war is indicative of the bifurcation in China's mammoth tech industry. On the one hand, players like DeepSeek are spurring major tech firms to invest in innovations like generative AI. On the other, the effects of Beijing's yearslong Covid lockdowns and regulatory campaigns against Big Tech still linger, and many companies are desperately searching for sources of growth in a saturated market. Mr Liu's marketing stunt is also personal. The viral videos of him waiting to pick up boxed lunches and downing beers with other riders mark a surprise return to the public eye for the 52-year-old tech mogul, who faded from the spotlight in 2018 when he was arrested in the United States on suspicion of rape, though prosecutors in Minneapolis ultimately declined to press charges. During Beijing's crackdown on the tech sector in 2022, Mr Liu joined a long list of tech founders who stepped down. His departure coincided with some of JD's toughest times since its founding as a tiny electronics outlet in 1998. Its premium online shopping service ran into China's slowing economy, its own bargain app flopped, and an overseas foray was abandoned. That left JD with no growth story, as giants Alibaba and Tencent Holdings bet big on generative AI and smaller rivals such as Meituan and Didi Global exported their gig-economy models abroad. Even Meituan has begun selling and delivering everything from iPhones to washing machines in a few hours. 'For JD, it's a lost five years, to put it bluntly,' Mr Liu said during a rare news conference at the company's Beijing headquarters on June 17. 'No innovation, no growth, no progress. It should be considered the most unremarkable and least valuable five years in my entrepreneurial history.' Explaining their rationale of getting into food delivery, Mr Liu said that it's about leveraging JD's battle-tested logistics network to acquire new users, 40 per cent of whom have already been converted into e-commerce customers. 'Our losses are smaller than what we would have spent on advertising,' he said. Not everyone is convinced. JD's takeout business could generate as much as 18 billion yuan in annualised losses, wiping out 36 per cent of its parent's operating profit for 2025, says JPMorgan Chase & Co.. Arete Research estimates that as the market leader, Meituan will only need to spend about a quarter of JD's costs to defend its position. JD's loss per order will narrow to 3 yuan in the second half of 2025 from 8 yuan this quarter as it pares back subsidies to confront the economic reality, the equity research house predicts. 'We do not think JD will find material success in local services like insta-commerce, but understand management's sense of urgency in needing to diversify its business mix and feeling threatened by Meituan,' Arete analysts wrote in a note in June. Representatives for JD, Alibaba, and Meituan didn't respond to requests for comment for this story. What's clear is that JD has injected new life into a long-dormant market. hardest hit by JD's offensive, gave out 10 billion yuan in subsidies to customers, then another 1 billion yuan to restaurants. Alibaba also integrated the takeout app into its flagship e-commerce platform Taobao in the hope of diverting more traffic to it. Meituan for the first time ever is giving away vouchers on things like smartphones and liquor during the June 18 sales event that JD invented more than a decade ago. Its founder Wang Xing declared to investors in May that it would do 'whatever measure it takes to win the game.' The renewed food-delivery battle is reminiscent of the all-out war in online shopping just years ago, when alleged abuses like forcing merchants into exclusive arrangements helped fuel Beijing's Big Tech crackdown, wiping out trillions in wealth. Though pressure has eased, government scrutiny remains heightened as high youth unemployment drives more and more people to take up gig work. Regulators in May summoned executives from the three takeout firms into meetings on fair competition and protection of riders, among other topics. By 2024, China had more than 10 million delivery riders, official data showed. In Beijing, there were 17,000 riders in the first half of 2024, up 50 per cent from a year ago. And amid growing awareness of how riders often prioritize speed over safety to earn more, said in April that it would gradually phase out a cash penalty system for riders who miss their deadlines. JD is going further in worker benefits by paying social security – a government-sponsored welfare system including pensions and medical insurance – for all of its full-time riders. Meituan and followed suit with similar policies. Tang Zequan, 36, recalls how in 2016 he could make more than 10 yuan per order as a new driver for Meituan in Guangzhou. After Meituan emerged dominant, his earnings went down to 7 yuan per order. As a high-school dropout, he acknowledges that no other job could have helped him pay off debts so quickly after his real estate brokerage business went under during Beijing's crackdown on the property market. 'I have great gratitude for the food delivery industry, but I won't pay allegiance to any firm,' Mr Tang said. 'Without choices we are left with a monopoly.' BLOOMBERG Join ST's Telegram channel and get the latest breaking news delivered to you.
Business Times
15 hours ago
- Business
- Business Times
JD.com billionaire's viral stunt reignites China's food-delivery feud
ONE unusually warm evening in April, Richard Liu revved his scooter through Beijing's traffic-snarled streets alongside other delivery workers, and then personally handed food orders to surprised customers. Later that night, over spicy hotpot and ice-cold beer, the Inc. founder welcomed a pair of riders from two rival delivery firms to his company. The publicity stunt, broadcast on viral online videos, reignited a fight for China's US$80 billion-plus food delivery market. In just a few months, JD, China's largest online retailer by revenue, amassed 25 million daily takeout orders across 350 cities, capturing more than half the volume of Alibaba Group Holding's the runner-up to market leader Meituan. Neither saw Liu coming. China's food delivery industry has been in an effective duopoly after brutal price wars forced out many smaller players almost a decade ago. Takeout became more expensive even as merchants and riders complained about making less. Liu is now turning to an old playbook: charging restaurants no commission, generous hiring bonuses for 100,000 new full-time riders, plus a 10 billion yuan (S$1.8 billion) discounting campaign for consumers. During its flagship shopping festival this month, JD sold coffee and bubble tea for as cheap as 1.68 yuan. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The food delivery war is indicative of the bifurcation in China's mammoth tech industry. On the one hand, players like DeepSeek are spurring major tech firms to invest in innovations like generative AI. On the other, the effects of Beijing's years-long Covid lockdowns and regulatory campaigns against Big Tech still linger, and many companies are desperately searching for sources of growth in a saturated market. Liu's marketing stunt is also personal. The viral videos of him waiting to pick up boxed lunches and downing beers with other riders mark a surprise return to the public eye for the 52-year-old tech mogul, who faded from the spotlight in 2018 when he was arrested in the US on suspicion of rape, though prosecutors in Minneapolis ultimately declined to press charges. During Beijing's crackdown on the tech sector in 2022, Liu joined a long list of tech founders who stepped down. His departure coincided with some of JD's toughest times since its founding as a tiny electronics outlet in 1998. Its premium online shopping service ran into China's slowing economy, its own bargain app flopped, and an overseas foray was abandoned. That left JD with no growth story, as giants Alibaba and Tencent Holdings bet big on generative AI and smaller rivals such as Meituan and Didi Global exported their gig-economy models abroad. Even Meituan has begun selling and delivering everything from iPhones to washing machines in a few hours. 'For JD, it's a lost five years, to put it bluntly,' Liu said during a rare news conference at the company's Beijing headquarters Tuesday. 'No innovation, no growth, no progress. It should be considered the most unremarkable and least valuable five years in my entrepreneurial history.' Explaining their rationale of getting into food delivery, Liu said that it's about leveraging JD's battle-tested logistics network to acquire new users, 40 per cent of whom have already been converted into e-commerce customers. 'Our losses are smaller than what we would have spent on advertising,' he said. Not everyone is convinced. JD's takeout business could generate as much as 18 billion yuan in annualised losses, wiping out 36 per cent of its parent's operating profit for 2025, says JPMorgan Chase & Co. Arete Research estimates that as the market leader, Meituan will only need to spend about a quarter of JD's costs to defend its position. JD's loss per order will narrow to 3 yuan in the second half of 2025 from 8 yuan this quarter as it pares back subsidies to confront the economic reality, the equity research house predicts. 'We do not think JD will find material success in local services like insta-commerce, but understand management's sense of urgency in needing to diversify its business mix and feeling threatened by Meituan,' Arete analysts Shawn Yang and Richard Kramer wrote in a note in June. Representatives for JD, Alibaba, and Meituan didn't respond to requests for comment for this story. What's clear is that JD has injected new life into a long-dormant market. hardest hit by JD's offensive, gave out 10 billion yuan in subsidies to customers, then another 1 billion yuan to restaurants. Alibaba also integrated the takeout app into its flagship e-commerce platform Taobao in the hope of diverting more traffic to it. Meituan for the first time ever is giving away vouchers on things like smartphones and liquor during the June 18 sales event that JD invented more than a decade ago. Its founder Wang Xing declared to investors in May that it would do 'whatever measure it takes to win the game.' The renewed food-delivery battle is reminiscent of the all-out war in online shopping just years ago, when alleged abuses like forcing merchants into exclusive arrangements helped fuel Beijing's Big Tech crackdown, wiping out trillions in wealth. Though pressure has eased, government scrutiny remains heightened as high youth unemployment drives more and more people to take up gig work. Regulators in May summoned executives from the three takeout firms into meetings on fair competition and protection of riders, among other topics. By 2024, China had more than 10 million delivery riders, official data showed. In Beijing, there were 17,000 riders in the first half of 2024, up 50 per cent from a year ago. And amid growing awareness of how riders often prioritise speed over safety to earn more, said in April that it would gradually phase out a cash penalty system for riders who miss their deadlines. JD is going further in worker benefits by paying social security - a government-sponsored welfare system including pensions and medical insurance - for all of its full-time riders. Meituan and followed suit with similar policies. JD has won over riders like Jiang Xiaoxi, a migrant worker in Shenzhen who joined Meituan before Covid but quit last year to take care of her sick grandfather in her hometown in Hunan province. When the 25-year-old returned to Shenzhen this year, she picked JD instead for regular eight-hour shifts and persuaded her peers to jump ship. 'I signed a contract on day one,' she said. 'Having social security as a full-time employee gives me a sense of belonging.' Others are wary of such promises, with memories of the past delivery price-war still fresh. Tang Zequan, 36, recalls how in 2016 he could make more than 10 yuan per order as a new driver for Meituan in Guangzhou. After Meituan emerged dominant, his earnings went down to 7 yuan per order. As a high-school dropout, he acknowledges that no other job could have helped him pay off debts so quickly after his real estate brokerage business went under during Beijing's crackdown on the property market. 'I have great gratitude for the food delivery industry, but I won't pay allegiance to any firm,' Tang said. 'Without choices we are left with a monopoly.' BLOOMBERG
Bloomberg
18 hours ago
- Business
- Bloomberg
JD.com Billionaire's Viral Stunt Reignites China's Food-Delivery Feud
One unusually warm evening in April, Richard Liu revved his scooter through Beijing's traffic-snarled streets alongside other delivery workers, and then personally handed food orders to surprised customers. Later that night, over spicy hotpot and ice-cold beer, the Inc. founder welcomed a pair of riders from two rival delivery firms to his company. The publicity stunt, broadcast on viral online videos, reignited a fight for China's $80 billion-plus food delivery market. In just a few months, JD, China's largest online retailer by revenue, amassed 25 million daily takeout orders across 350 cities, capturing more than half the volume of Alibaba Group Holding Ltd. 's the runner-up to market leader Meituan. Neither saw Liu coming.
