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The concept of the Internet of Things is now being used more and more in enterprises. The concept is simply the Internet of things connected. If you understand it further, there are two meanings: first, the core and foundation of the Internet of Things is still the Internet, which is an extension and expansion network based on the Internet; second, its user end extends and extends to any item and item , For information exchange and communication. Therefore, the definition of the Internet of Things is to use radio frequency identification (RFID), infrared sensors, global positioning systems, laser scanners and other information sensing equipment to connect any item to the Internet for information exchange and communication according to an agreed protocol. A network that realizes the intelligent identification, positioning, tracking, monitoring and management of items.
In today’s e-commerce competition, user experience has gradually become the focus of everyone’s attention. The speed of delivery is one of the key points of user experience. In addition, for e-commerce companies, the purchased goods should not be stocked for too long. Also cannot be out of stock; long inventory time will take up funds, and lack of stock will affect the user experience.
Use the Internet of Things technology to improve user experience and solve the problem of sales forecasting.
At 1 o’clock noon on June 5, Mr. Zhang from Shanghai placed an order to buy a laptop and a wireless router on JD.com.
At almost the same time, Ms. Yu from Beijing placed an order including several books and a yoga towel on JD.com.
Mr. Zhang, who bought the laptop, saw on the Jingdong Mall order tracking page that the order entered the production process after 10 minutes, and at 8 o’clock the next morning, Mr. Zhang received the product.
And Miss Yu’s order is divided into two sub-orders at the same time as the order is placed. The order tracking page showed that after 10 minutes, the book sub-order entered the warehouse production process. However, the order for yoga towels is out of stock and cannot be shipped out temporarily.
At noon the next day, Ms. Yu, who lives in Beiyuan Jiayuan, Beijing, received an order for books. The other sub-order did not enter Beijing No. 1 warehouse until June 10 and was ready to be shipped out.
The two orders of Ms. Yu and Mr. Zhang respectively represent the 3C, department stores and new book categories that Jingdong Mall is best at. The production speed of the two orders and the delivery speed also reflect the strengths and weaknesses of a developing e-commerce company in supply chain management.
Interpreting the supply chain of JD.com, it can be seen that supply, system, data, warehousing, and distribution are a comprehensive interactive and continuously upgraded system, and the time and experience of accumulating data directly determines the system’s impact on the entire supply chain. Management efficiency.
JD.com has integrated IoT applications into its distribution links, which is also an attempt to optimize its supply chain.
1 Historical data determines the storage location
“The entire process of order production is inside JD.com. The warehouse is equivalent to the factory, which is the place where orders are produced. The front desk where users place orders, that is, the website of JD.com, is connected to the national warehousing system. After the orders at the front desk are placed, the system will Calculate the fastest delivery route based on the user’s delivery location to automatically match the warehouse.”
The reporter saw on Miss Yu’s online order tracking display page that the order has entered the Beijing No. 5 warehouse at 13:10:31 noon on June 5 and the order has been printed out at 13:30:07, and the order has been printed at 14:21:17. Picking has started, the order has been scanned and confirmed at 14:22:02, and the order has been packaged at 14:24:36. At each process node, there is a specific handler name.
“This is the entire process of order production.” In JD.com, the warehouse is equivalent to a factory, that is, the place where orders are produced. The front desk where users place orders, that is, the website of JD.com, is connected to the national storage system. After the front desk order is placed, the system will calculate the fastest delivery route based on the user’s delivery location to automatically match the warehouse. For example, Beijing Miss Yu’s order will automatically match Beijing No. 5 warehouse. The orders of Mr. Zhang from Shanghai are automatically matched to the Shanghai warehouse.
Each warehouse of Jingdong Mall is divided into three major parts, the front is the receiving area, the middle is the storage area, and the back is the outgoing area. In the receiving area, after the quality of the goods sent by the manufacturer is checked, each product must be affixed with a bar code as an “identity card” to identify the product. Then, all the commodities are put on the storage area and put into the warehouse. On the shelves, each shelf has a number. When the goods are put on the shelf, the tally staff will scan the barcode of the goods to associate with the position, and upload them to the system. In this way, when the order is being produced, the picker only needs to pick up the goods on the corresponding shelf according to the position recorded by the system, without checking the name of the product.
Miss Yu’s order is automatically divided into two sub-orders, which are produced in different warehouses. In this regard, Jiang Haidong, vice president of Jingdong Mall, said that this is actually a balance between efficiency and user experience. This is not artificial, but the system has the final say. In Miss Yu’s order, one of the items is out of stock, then the order is automatically divided into two sub-orders.
In addition, there are objective reasons for warehouse restrictions. At present, in Beijing, because large-area single warehouses are difficult to rent, JD’s products are divided into 6 warehouses. Books are currently in independent warehouses. Department stores and 3C products are in different warehouses. In order to balance efficiency, the system will split orders for delivery.
“In theory, one-time packaging and distribution of user orders is the lowest cost way.” Jiang Haidong said, but not all products can be packaged into one order, such as large household appliances and bedding cannot be shipped together. Even if the storage is in the same warehouse, the system will automatically divide it into two orders.
Take Mr. Zhang’s order production process as an example. After Mr. Zhang places an order, 15 to 30 minutes later, the order is printed on the high-speed printer in the warehouse. The order is in triplicate, and the order number is written. The stock picker in the warehouse will use a trolley to take 20 to 30 orders of goods at a time, and the route of his travel is counterclockwise according to the goods position on the order.
However, according to the data of the user’s order, the location of the product inventory in the same library is not static. The system will calculate the historical data, and some products with a high degree of purchase relevance will be placed closer to save the time for the warehouse combination to complete the order. In addition, when the front desk is carrying out matching promotions, the inventory location will also change. Seasonal products will change the storage location when the season changes to save picking time. After the pick-up is completed, different orders are placed in different plastic baskets. Finally, it is packed by the packing area.
After packing, scan the barcode in the shipping area. Even if this product is out of the warehouse, users can see that the order status has changed to “commodity out of the warehouse” on their tracking page.
2 Visual package transportation
“Through the GIS system, the logistics manager can see the logistics operation in the background in real time. At the same time, the location information of the vehicle, the stay time of the vehicle, the distribution time of the package, the delivery time between the delivery staff and the customer, etc. will form the original data. These. After the data is analyzed, it can provide managers with more and more valuable references.”
After the sub-orders produced in Beijing No. 5 warehouse are packaged, they are placed in the waiting area. In Beijing, Shanghai, and Guangzhou, JD.com’s own distribution team distributes goods. In some other cities, JD.com distributes the goods to each express company in different regions. Each district has a computer connected to the Internet. When the express company takes the goods away, it will scan the computer. At this time, the order information that the user sees on the page will become delivered.
Originally, users can observe where the order arrives at each time on their own page. For example, when to arrive at the delivery site, when to allocate to the delivery staff, etc. At present, many e-commerce companies and even big sellers on Taobao can basically provide the above-mentioned logistics information query service.
Recently, after a GIS system was launched on JD.com, users can see the timely movement of their orders on the JD page. This GIS system comes from the creativity of Liu Qiangdong, CEO of JD.com. When he read the customer service briefing once, he found that 32% of user consultation calls were made after the delivery of the goods. Users call, and most of them ask if the order has been delivered, where it is currently, and when will it arrive. Liu Qiangdong believes that, in fact, the customer service staff simply cannot know the specific location of each order, nor can it accurately tell the user the arrival time. Therefore, the user’s consultation call is often invalid. Instead of asking the user to call and ask, it is better to let him watch it at the right time. This reduces the user’s troubles and improves the user experience. Under Liu Qiangdong’s proposal, Jingdong Mall began to develop the GIS system, which was put into use six months later.
On the map of Miss Yu’s order page, the reporter saw a package sign moving in a red track on the map. The red line of the package moves along the Fifth Ring, the line that the package will pass is a red dashed line, and the line that has passed is a red solid line.
After arriving at the Lishuiqiao substation, the parcel sign stopped. Early the next morning, when I opened the map, I could see that the package started to move again. The reporter saw the package running on the map, and could even see an intersection where the package had turned. Ms. Yu accurately calculated the delivery time of the package based on the running status of the package.
JD.com is the first e-commerce enterprise to use GIS system, which makes users feel very strange. Zhang Limin, vice president of JD.com, introduced that this GIS system is a typical application of the Internet of Things and an implementation of visualized logistics. In traditional offline stores, users can see and touch the goods, and seeing is believing is an experience that e-commerce cannot replace. And this kind of visual logistics can eliminate the psychological gap between online and offline users. Users can perceive their orders at the right time, which is an improved user experience.
“The GIS system is not particularly difficult technically.” Zhang Limin said that Jingdong cooperated with a company that provides map services to associate the back-end system with the GPS system of the map company. When the package is out of the warehouse, each package has a barcode. The delivery vehicle also has a corresponding barcode, and each package will be scanned when it leaves the warehouse. The barcode of the package on the same vehicle is associated with the barcode of this vehicle. When the car is running on the road, the on-board GPS and map form a real-time position information transmission, which is the same as the on-board GPS system.
When the vehicle arrives at the distribution station and is assigned to the delivery staff, each delivery staff has a handheld PDA during delivery, and this handheld PDA is also a GPS. By scanning the barcode of each package, the package is associated with the map system. After this timely location information is opened up to the front-end users after opening up the back-end system of JD.com, users can see the running trajectory of their orders from the warehouse to the delivery on the online page in real time.
“While improving the user experience, GIS also provides real-time monitoring of the logistics team and raw data to improve the overall logistics management level.” Zhang Limin pointed out that the GIS system enables logistics managers to see the logistics operation in real time in the background. , Vehicle location information, vehicle stay time, parcel distribution time, delivery time between delivery staff and customers, etc. will form the original data. After these data are analyzed, they can provide managers with more and more valuable references, such as how to use personnel reasonably, how to divide the service area of delivery service personnel, and how to shorten the delivery time of each single ticket. Through a large amount of data analysis, in order to optimize the entire distribution process. In addition, through the divergence analysis of a region, we can see the regional composition of customers, the density of customers, the density of orders, etc., and match resources based on these data.
3 The key to sales forecast
“Involved in e-commerce, JD.com has accumulated a large amount of data. By calculating these data, JD.com can predict the sales performance of a certain product in each region. According to historical data predictions, stocks are prepared for each warehouse. These data are the source. For the product’s click-through rate, pageviews, search rate, etc.”
An e-commerce company said in an interview with reporters that it is difficult to get involved in the 3C category because the price of 3C products fluctuates very quickly. This is a great test for e-commerce companies. Jingdong Mall started from the 3C category.
“For e-commerce companies, the purchased goods should neither be stocked for too long, nor can they be out of stock quickly. Long stocking time will take up funds, and the lack of stock after the user places an order will affect the user experience.” Jiang Haidong pointed out , Predicting sales and preparing the database based on sales volume are the core capabilities of the supply chain of e-commerce companies. In addition, for user experience, the closer the product is to the user, the faster the delivery speed and the better the consumer experience. Therefore, which warehouses the purchased goods are allocated to and how much each warehouse is allocated are also the core technology in the supply chain.
JD.com has more than 10 years of experience in 3C products, and it will accumulate a large amount of data when involved in e-commerce. Through the historical calculation of these data, it is possible to predict the sales performance of a certain product in each region. According to the forecast of historical data, stocks are prepared for each warehouse. This data comes from the click-through rate, pageviews, search rate, etc. of the product.
In addition, you can also test products through price adjustments and other methods. For products that are particularly new and have little historical data to refer to, artificial judgments will be added. Since JD’s purchasers all have a lot of experience in the 3C industry, these experiences are also a powerful reference for inventory preparation. For example, IPHONE is on the market. This is a product that did not exist before. JD’s procurement staff will judge its market performance based on the characteristics of this electronic product, and stock up based on experience.
For products that have been sold for a long time, such as laptops, it is already possible to stock up based on historical data. The average inventory turnover rate of Jingdong’s 3C products is 12.6 days. Although the price fluctuates very quickly, the inventory turnover rate is shortened to 12.6 days, and the sale of the product is often completed before the price of the product has fallen. In this way, JD’s purchasing staff will frequently purchase. Even open the platform to suppliers so that they can see the sales status of their products in the background in order to replenish them in time.
The establishment and optimal operation of any supply chain system are analyzed and calculated by a large amount of historical data, which guides the purchase and distribution of warehouses. JD.com has its strengths, but also its weaknesses. For a single category of department stores, affected by operating time and experience, the accumulated data is limited, and the supply chain cannot be as smooth as 3C products. For example, at the beginning of this article, the yoga towel ordered by Miss Yu is out of stock. In addition, due to the low sales estimate for a certain category during large-scale promotion, the purchase has not been replenished in time, which may also cause shortages.
Before mid-May of this year, users in Guangzhou who ordered books on JD.com had less experience than users in Beijing. Books would not be delivered to him in three days. This is because the order placed in Guangzhou at that time was sent from the Beijing warehouse, because there was no local library in Guangzhou at that time. With the opening of the Guangzhou Book Warehouse, users’ book orders on the day will be received the next day.
The improvement of the supply chain of e-commerce enterprises is a systematic project. The front-end website is set up very quickly, but if it is connected with the back-end inventory management and logistics distribution, this is a huge project. Therefore, users often find that in areas such as Beijing, Shanghai, and Guangzhou that have self-built warehouses and their own logistics teams, the process from placing orders to acquiring orders is faster for users, and the experience will be better.
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