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Smithfield Foods takes another step in developing its e-commerce business and expand its presence in China.
October 24, 2017
WH Group Limited, the world’s largest pork company, announces that its wholly-owned subsidiary Smithfield Foods Inc., the renowned U.S. pork processor, has jointly launched a Tripartite Strategic Partnership Agreement with JD.com, China’s largest retailer, and Henan Shuanghui Investment and Development Co. Ltd. According to the agreement, which was announced at an event in New York, the fresh food division of JD.com, JD Fresh, will become the exclusive online sales platform for Smithfield’s pork products in China. Also, the parties will sell more than ten kinds of exclusive products on JD.com and further cooperate on big data, cold chain logistics and foods traceability.
Kenneth Sullivan, president and chief executive officer of Smithfield, said at the ceremony: “Through this partnership, Smithfield Foods will take yet another step in developing its e-commerce business and expand its presence in China, as we meet consumers where they shop. Smithfield has a strong food safety platform, and we take this even further to deliver products consumers enjoy and feel good about sharing with their families. We are proud to bring this longstanding reputation and sense of responsibility to our partnership with JD.com.”
Shuanghui Development is the exclusive domestic agent of Smithfield. Ma Xiangjie, vice president of Shuanghui Development, says: “Shuanghui Development will capitalize on its national presence of industrial facilities and knowledge of domestic and foreign consuming habits, to introduce more and more Smithfield and Shuanghui products for family meals, meeting the personalized and convenient needs of the end-user towards imported products.”
Richard Liu, JD.com chairman and chief executive officer, says, “Ensuring the quality, safety and reliability of everything we sell is part of JD’s overall commitment to our customers. When it comes to food, and particularly a major staple of Chinese households like pork, this is even more critical. That’s why we are pleased to be working with Smithfield, a trusted and respected partner with a long history in the industry, to offer easy access to high-quality choices for even more families around the country.”
Smithfield’s pork products have long been known for their high quality. The products sold exclusively on JD will include bone-in cuts and variety meats, with a focus on small-packaged frozen products. These are all products which Smithfield specializes in, and includes the types of products in highest demand in China.
JD Fresh is the largest direct sales fresh food platform in China. In the first half of 2017, gross merchandise volume for meats from direct sales of meats on JD increased more than 780% year-over-year. It is now the largest online pork retail platform in China.
Launching these new products is just the first step in the partnership. According to the agreement, JD will leverage its big data insights to help Smithfield in areas including data analysis and categorization of on-shelf goods and to carry out precisely targeted marketing campaigns based on in-depth study of consumers’ shopping behaviors.
In order to ensure product quality and safety, JD and Smithfield will work on seamless cooperation in cold chain logistics. In the United States, whether it is land or marine transportation, Smithfield can monitor in real time the temperature inside the cargo hold of a truck and inside a container. When the products are imported to China, there are two sets of cold chain distribution systems, from both JD.com and Shuanghui, to help ensure quality and freshness.
Smithfield is a world leader in product traceability throughout animals’ lifetimes — from raising live animals to the sale of the final products. JD.com has also been actively implementing block chain tracing technology in recent years. It set up the “JD Tracing and Anti-Counterfeit Alliance” earlier this year which has been successfully applied to beef, chicken, seafood and other animal products. The cooperation between the two sides in the cold chain and traceability can ensure the cold chain system in place will protect the quality of every piece of pork cut transported from the United States to China. Its “identity information” is open, transparent and searchable.
The partnership is another example of the synergy between WH Group and Smithfield after the acquisition in 2013. The fast and direct delivery of high-quality products to Chinese consumers illustrates how the company is capitalizing on its global industrial resources deployment. The cooperation enables high-quality imported pork products to go directly to the dining tables of Chinese consumers, fills gaps in the domestic market of fresh imported pork products, and brings traceable, safe and quality products to consumers. With completed and efficient cold chain logistics, and self-operated after-sales service, it maximizes consumers’ online shopping experience.
Source: WH Group, Smithfield Foods
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