Introducing

JD.com

China: #1 Ecommerce Market Globally

Data source: eMarketer, December 2014

Figures above do not include travel products and services

$21.34 $23.4 $33.05 $40.43 $46.13 $82.93 $88.06 $104.22

$394.43

$714.58

13.5% 15.3% 14.9%

10%

8.2%

12.9% 11% 11%

13%

27%

0%

5%

10%

15%

20%

25%

30%

0

100

200

300

400

500

600

700

800

Brazil Russia Canada Korea France Germany Japan UK USA China

Annual Sales

(USD Billions)

Y-o-Y Growth

Rate (%)

2016 Annual Sales Forecast for Top-10 Ecommerce Markets Globally

China is the world’s the biggest & fastest growing major ecommerce market

China eCommerce Market

688 million

Internet Users

448 million

Online Shoppers

70% Of Online

Transactions were

Mobile

14% Of China’s Total

Retail Sales

Data source：iResearch， CNNIC， Commerce Department 2016

JD.com

2 Global TOP 10 Internet Company

3 Largest Online Retailer in China

4 Largest Internet Company by Revenue in China

*

* Calculated by market value

JD.com: A Clear Global Leader

1 2016 Global Fortune 500 Company

366 JD.com Inc.

One of the World’s Largest

Top International Internet Companies

Source：Resource：Google Finance 9 Mar. 2016 2015 Revenue

Company Region 2015 Revenue (USD)

Amazon.com US 107bn

Google US 66bn

JD.COM China 28bn

Facebook US 17.9bn

Tencent China 12.9bn

Alibaba Group China 11.7bn

Baidu China 10.2bn

Priceline US 9.2bn

eBay US 8.6bn

Yahoo US 4.9bn

• Member of NASDAQ-100 Index

• e-Commerce Retailer of the Year 2015, World Retail Congress

• BrandZ Top 100 Most Valuable Global Brand 2016

JD.com – All-category Online Retailer & Marketplace

0

1000

2000

3000

4000

5000

6000

7000

2012 2013 2014 2015 2016

Rapid Growth in GMV

462.7 billion

73.3 billion

2016 Performance

Net Revenue Fulfilled Orders

Active customer Merchants

120,000

Employees

120,622

Unit: RMB

Sustained, Rapid Growth

[1] Core business data

[2] Excluding virtual items

[3] In the 12 months ended December 31, 2016

Data source：JD.com’s financial reports

GMV

RMB658.2 billion

Increase of 47% Y-o-Y RMB 260.2 billion

Increase of 44% Y-o-Y 1.6 billion

Increase of 55% Y-o-Y

226.6 million

Increase of 46% Y-o-Y*

260.2 billion

125.5 billion

Net revenues for the full year of 2016 were RMB260.2 billion,

an increase of 44% from the full year of 2015.

[1] [2]

[3]

658.2 billion

JD Growing Around 2X Industry Growth Rate

Source: iResearch: 2016.11

50%

33%

4%

3%

1% 1% 1% 1% 0%

6%

2016 Q2 B2C E-commerce Market Share

Tmall

JD.com

Suning

VIP Shop

Gome

YHD

Amazon China

Dangdang

Jumei

Others

JD.com is growing at around twice

the industry growth rate – on track to

become the largest B2C e-

commerce platform in 2 years.

Guaranteeing Product Quality & Authenticity

Strict

control of

supply

channels

JD

Six Quality

Control

Measures

Strict

criteria for

approval

Random

sampling

inspection

Guaranteed

return

policy

Independent

research

Strict

penalties

system

JD.com has a strict zero-tolerance policy toward counterfeit goods.

We source products directly from world-leading global brands, and

work tirelessly to eliminate counterfeits.

Largest e-commerce logistics infrastructure in China

Small to Medium

Oversized Cold Chain

Express delivery service has been upgraded to 2 hours

256 warehouses

6,906 delivery stations, pickup points, and pickup stations

in 2,655 counties and districts

Warehousing facilities covering an area of 5.6 million

square meters

Unparalleled Logistics

Data source：JD.com’s financial report, as of December 31, 2016

The leader in providing small-to-medium sized warehousing, oversized

warehousing, cold chain delivery and frozen and chilled warehousing facilities,

enabling truly global standard logistics services

Inventory turnover shortened by 8 days

Consignments shortened by 2 days

Customer satisfaction raised 113%

Sales raised 97%

Saves time, labor, worry and

cost for merchants

Comprehensive service system

targeting logistics “pain points”

Open Logistics Platform Provides Merchants

One-Stop Supply Chain Solutions

Warehousing Transportation Delivery Customer

Service After Sales

JD Delivery Supply chain

logistics Logistics cloud

Fully

integrated

logistics

Cold chain

logistics Large

package

logistics

Supply chain

finance

International

supply chain

WeChat Partnership

WeChat is a social messaging APP (like Whatsapp or LINE) with 800+ million monthly active users.

JD has an exclusive WeChat shopping channel driving a huge amount of traffic to JD.

WeChat Shopping

Channel

Tens of millions of orders

in a day, 5X compared to

the week before

JD official WeChat account’s

newsfeeds covers 80+ million

followers daily

Industry-Leading Partnerships

JD Worldwide

Chinese Consumers’ Urge For Foreign Products

Food safety scandals led to a huge demand of baby

formula, among other products, from overseas

To ensure sufficient supply to local babies, the Hong Kong

government set a two-can export limit on infant formula

Similar limits were imposed by UK and Australian retailers

The Milk Rush

Safety Availability Low Tax

Consumers seek safe

products from overseas

Lower import barriers via cross

border ecommerce allow consumers

buy products not available in China

0% customs duty; reduced VAT

and consumption tax (11.9% in

total for most categories)

Why Cross Border Ecommerce?

Tmall Global

TaoBao

JD Worldwide

Kaola

VIP.com

Amazon.cn

others

One of the Largest

2016 Q4 China Cross-border Ecommerce Platform Market Share

18.9%

15.4%

11.8% 11.6%

7.3%

6.6%

28.4%

Data source：www.analysys.cn 2016Q4

Who’s Doing Cross Border?

Care

Health

Baby

Food

Electronics

Retailers

JD Overseas Warehouses

Tokyo Osaka

Incheon

Hong Kong (Direct Mail)

Sydney

Melbourne

Los Angeles (Direct Mail)

New York

Neuss, Germany

Rotterdam, Netherlands

Suffolk, UK

Dymonville, France

★

： Warehousing, consolidation, separation

： Inspections

： Air & sea freight

Cross Border Logistics Models

Bonded Warehouse

Merchants / Suppliers

Sea

Air

Bonded Warehouse / Free Trade Zones

Last-mile

Consumers Overseas Customs China Customs

Overseas Domestic

JD Overseas Warehouse

Small Parcel Direct Mailing

Merchants / Suppliers

JD Overseas Warehouse

Air

Free Trade Zones

Last-mile

Consumers Overseas Customs

China Customs

Overseas Domestic

Land

Order-to-Customer: 1-5 days

Order-to-Customer: HK 2-8 days ; US 7-10

7 Bonded warehouses in China: Guangzhou, Shanghai, Ningbo, Hangzhou, Zhengzhou, Tianjin,

Chongqing

Faster Delivery

Cheaper Logistics

High inventory risk – hero

items only

Low inventory risk – long tail

Slower Delivery

Costlier Logistics

Enabling Smart Logistics

Innovative technology to power smart commerce

Smart Supply Chain

Automated Operations

Data-based Operations

JD Logistics Lab is developing fully automated logistics centers,

delivery drones, warehousing robots and automated vehicles to further

improve efficiency. During 2016 Singes Day, drone delivery trials were

conducted in 4 rural areas across China.

Asia No.1 is one of China’s largest and most advanced network of

e-commerce logistics centers. As of now, 7 Asia No.1 warehouses are in

active use across China.

Two Ways To Work With JD

Source：Resource：Google Finance 9 Mar. 2016 2015 Revenue

Marketplace Be a seller on JD

Direct Sales Sell to JD

Comparable Model Shopping Mall Supermarket

For Whom?

• Retailers • Brand Owners / Distributors

• Brand Owners / Distributors • Trading companies

Marketing Execution &

Inventory Ownership Brands/Merchants JD

Products

• New Brands • Unique Products

• Brands with Established Track

Record • High Volume

JD.com vs JD Worldwide

JD.com (within China) JD Worldwide

VAT 17% 11.9%

Consumption Tax Cosmetics (15%) Cosmetics: VAT+ Consumption tax

(26.35%)

Customs Duty 10-35% Waived

Profits Tax on Chinese Entity 35% (with exception for certain

industries) Nil

Import Compliance 3C Certificates and CFDA

approvals (1-5 years)

Expedited Customs & Quarantine

Filing (2-4 weeks) for some product

categories

Inventory Already in China In Free Trade Zones or Overseas

Shipping Lead Time 2-7 Days

2-21 Days (depends on shipping

modes and origins)

Fees and Deposit

Marketplace Be a seller on JD.hk

Annual Platform Fee USD 1,000

Commission 2% - 10%

depending on product category

Deposit

USD 15,000

Payment Settlement

Generate Statement

(last day of every month)

Statement Approved by

Merchant

Statement Approved by

JD Operation Team

Final Approval by JD Finance

Payment Settlement

7-10 Days

• Fulfilled transactions for the month would be included in the monthly statement. • Completed transactions - after customers have confirmed receiving the products or 21

days from the point of order

The Cross-border Marketplace Ecosystem

Contribution to Success

Brand Owners / Retailers &

• Products popular in China • Pricing • Marketing & advertising budgets (eg. Gifts, coupons)

TP (Store operations service

provider)

• Enhancing conversion rate • Marketing plan & coordination • Advertising execution • PR content generation • Pre & post sales customer service • Webpage & product information page design; translation

JD Worldwide

• Traffic – search, banners, seasonal and tropical marketing campaigns • WeChat marketing channels • Data driven, targeted advertising tools through JD website, JD App, WeChat and external websites • PR distribution channels (eg. JD Worldwide official WeChat, Weibo accounts) • Offline marketing channels (eg. Supermarket and pharmacy chain displays, 100,000-person promotion team in • Market insights; Customer and store data • Last-mile delivery in China

Logistics Service Providers

• Customs clearance • Bonded warehouse & overseas warehouse solutions • International shipping

Cross-Border eCommerce Logistics Solutions

Data source: General Administration of Customs PRC

Solutions Tax Rate Product Compliances

Before Apr 8th 2016 After Apr 8th 2016 Before Apr 8th 2016 After Apr 8th 2016

EMS

(Postal Channel)

Post Mail Customs random inspections (tax rate specified by

Customs)

Prohibited Item List

Express Mail Advance tax declaration, RMB50 Exemption + Postal

Article Tax

Cross-Border

eCommerce

Policy

Direct Mail RMB50 Exemption

+ Postal Article Tax

(VAT + Consumption Tax）

X 70%；

Customs duty waived

Black List Allowed List

Bonded

Warehouse

RMB50 Exemption +

Postal Article Tax

(VAT + Consumption Tax）

X 70%；

Customs duty waived

Black List Allowed List + Other

Requirements

New Tax Policy

Data source: General Administration of Customs PRC

Product Value

New Tax Rate

(customs + VAT +

consumption)

Regular Import Tax

Rate

Baby products, Food, etc

< RMB 500 0% 11.9% Mostly 30% - 50%

> RMB 500 10% 11.9% Mostly 30% - 50%

Home appliances

< RMB 250 0% 11.9% Mostly 30% - 40%

> RMB 250 20% 11.9% Mostly 30% - 40%

Cosmetics

< RMB 100 0% 26.35% 47%

> RMB 100 50% 26.35% 47%

What logistics model should you choose?

General rules only. Please consult our business development team for more details

Is the product on cross border ecommerce

“allowed list”?

Does your product satisfy traditional import

requirements?

Bonded Warehouses in FTZ

- Lead time: 1 - 2 days

- Reduced VAT: 11.9%

Overseas Warehouse Direct Mail

- Lead time: 7 – 14 days

- Reduced VAT: 11.9%

Postal Channel

- Lead time: 7-14 days

- Personal Postal Article Tax Rate: 15%, 30%, 60% (varies by products)

Commercial Considerations

- New brands to Chinese consumers; unpredictable product sales

- Low-priced products with postal article tax below 50 RMB; tax is waived

Yes No

Yes No

THANK YOU

Business Development Team

worldwide@jd.com