JD.com announced at the World Economic Forum in Davos that it completed its first drone delivery in Indonesia, a milestone for logistics in Southeast Asia. The initiative is to support JD.com’s goal of being able to deliver 85% of orders either same-day or next-day in Indonesia. Drones for Logistics is Nothing New in China, but it is in Southeast Asia While drones have already been deployed in China to deliver goods, they had not been used in Southeast Asia until recently. JD.com’s trial drone flight in Indonesia was a collaboration between JD.com, the Indonesian government and the World Economic Forum’s Centre for the Fourth Industrial Revolution to provide solutions for Indonesia’s logistics challenge. JD.com’s drone delivery is the first time a Chinese drone has been used for delivery in Southeast Asia, and is also the first time the Indonesian government has granted permission to use a drone for logistics purpose. Improving Logistics and Offering Philanthropic Support  JD.com used a drone to transport books and backpacks over 250 kilometers to students at a school in a village near Bandung, the country’s fourth-largest city. This drone-based shipment was a trial that was part of a large donation, the remainder of which was delivered by conventional methods. The company sees potential to build on the test to develop a drone-based delivery system that can help service far-flung areas, improve local medical systems and generally expedite its shipments. [caption id="attachment_66829" align="aligncenter" width="648"] JD.com drone delivery in Indonesia
Source: JD.com/YouTube[/caption] Indonesia’s Logistics Challenge and JD.com’s expansion in Indonesia Indonesia is the world’s fourth most populous country with more than 260 million people, many of whom live in remote areas or which are simply not easily accessible due to underdeveloped infrastructure.  In the meantime, JD.com says it has more than 20 million registered users in Indonesia and a catalog of more than one million products. Leveraging drones to overcome Indonesia’s logistics challenges not only helps Indonesia, it also helps solve JD.com’s problem of delivering products ordered online.  Since March 2016, JD.com has been expanding its business rapidly in Indonesia, with 19 product categories, more than 350,000 SKUs and more than 20 million users across 483 cities. JD.com launched unstaffed convenience stores in Indonesia in 2018.   Zhenhui Wan, CEO of JD Logistics, said JD Logistics has built the largest e-commerce logistics network in Indonesia, and hopes drone technology will bring smart logistics to the archipelago.  Takeaways JD.com’s recent test of drone technology in Indonesia marks an important milestone in the company’s efforts to build out it logistics abilities in Indonesia and Southeast Asia. The underdeveloped state of the country’s infrastructure means that drones could play an important role in reaching people — especially those in remote areas. JD.com’s first move into drone technology in Indonesia sets the stage for competition in logistics space against its main rival Alibaba.