JD Logistics Unveils Integrated Supply Chain Solution for Pharmaceutical Sector with 'One Inventory' Model

Since entering the pharmaceutical logistics sector last year, JD Logistics has continued to advance and recently announced new developments. As the scale of its pharmaceutical cloud warehouses continues to expand, the “single inventory” model empowered by JD Logistics is poised to bring about a new transformation in the pharmaceutical industry’s supply chain. This model will not only address logistical pain points for manufacturers and distributors but also provide consumers with a safer, faster, and more cost-effective service experience.

VCBeat (WeChat ID: vcbeat) has learned that at the JD Logistics Medical Device New Channel Promotion Conference held on June 27, themed “Borderless Retail, Shared Inventory,” Li Caifen, Head of Pharmaceutical Business Development in the Open Business Division of JD Logistics, stated that JD Logistics would initially pilot its services in the medical device sector before gradually expanding into the pharmaceutical distribution field. By expanding its pharmaceutical cloud warehousing capacity and leveraging JD Logistics’ robust transportation and delivery network, JD Logistics is helping to upgrade China’s pharmaceutical supply chain.

Li Caifen, Head of Pharmaceutical Business Development at JD Logistics’ Open Business Division, Introduces JD Logistics’ Open Model

Under the trend of boundary-less retail, nearly every industry is poised to embrace innovation in supply chain management. For a long time, the pharmaceutical distribution sector, characterized by its unique nature, has suffered from pain points such as excessive intermediaries, high costs, low levels of informatization, and poor supply chain coordination. With the advancement of the new round of healthcare reforms, the “Two-Invoice System” will significantly compress pharmaceutical distribution channels and rapidly increase industry concentration. Consequently, supply chain management in the pharmaceutical sector must undergo systematic innovation and upgrading.

The core of this upgrade is shifting from “multiple inventory pools” to a “single inventory pool.” The term “multiple inventory pools” refers to maintaining separate, independent sets of product inventory for the same items across different sales channels, such as online, offline, wholesale, and retail. In contrast, a “single inventory pool” means integrating all products into a unified strategic layout, connecting all sales channels to achieve inventory sharing and centralized allocation.

The benefits of the “Single Inventory Pool” model are evident: it maximizes supply chain collaboration, significantly improves inventory turnover efficiency, and reduces logistics costs. The pharmaceutical “Single Inventory Pool” model developed by JD Logistics encompasses omni-channel integration across online and offline channels, multiple e-commerce platforms, and multiple stores within the same e-commerce platform. Its ultimate goal is to achieve “one brand, one inventory set, one supply chain.”

Since entering the pharmaceutical logistics sector, JD Logistics has first aggregated warehouse resources certified under Good Supply Practice (GSP) for Pharmaceutical Products to establish the JD Pharmaceutical Cloud Warehouse. By leveraging open logistics capabilities, it has infused these facilities with systematic warehouse management expertise and operational standards. Meanwhile, JD Logistics has integrated its robust transportation and delivery network to provide end-to-end services compliant with GSP requirements, including product acceptance, warehousing, storage, and distribution. Furthermore, through online sales platforms and supply chain finance solutions, JD offers comprehensive supply chain services to pharmaceutical brands and distributors.

To address the diverse stakeholders in the pharmaceutical sector, JD Logistics has developed tailored service solutions. For pharmaceutical manufacturers, it offers one-stop, integrated supply chain services; for wholesalers, it provides trunk-line and branch-line distribution services; and for chain pharmacies, it delivers intra-city store-to-store distribution services from centralized warehouses.

Bai Yu, President of the Medical Device Branch of the China Medical Pharmaceutical Material Association and Chairman of Kangfu Zhijia Health Management Group, stated that the “single inventory” supply chain management model provided by JD Logistics would significantly improve the logistics efficiency of medical devices and substantially reduce logistics costs. Brand owners can confidently outsource their logistics operations to focus more on product research and development, while distributors can be relieved from inventory and capital pressures to concentrate on sales.

For consumers, the upgrading of the pharmaceutical supply chain means an enhanced consumer experience. JD Logistics’ warehousing and distribution system empowers the pharmaceutical sector, making the purchase and delivery of pharmaceutical products safer and faster. Meanwhile, as logistics costs decrease, pharmaceutical products will become more affordable.