Under the agreement, Smithfield Foods, a subsidiary of Hong Kong-based WH Group, will sell a range of frozen bone-in cuts and variety meats – products the business claimed were in “highest demand” in China.
Alongside enhanced access to China’s big and increasingly tech-savvy consumer market, Smithfield will be able to tap into JD.com’s big data know-how. This will allow the business to analyse shopper habits, transforming insight into profit-generating actions such as bespoke marketing campaigns.
“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,” said Kenneth Sullivan Smithfield CEO.
“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.”
Food will be sold through JD.com’s ambient food division, JD Fresh, the largest online marketplace for pork in China, according to Smithfield.
Getting product online is just the start of the Smithfield-JD partnership. Both parties will cooperate on cold chain logistics and traceability to bring US-style standards to China, a country with a questionable record when it comes to cold chain storage.
Back in the US, Smithfield can monitor in real-time the temperature of meat when it travels around the country. This allows it to react quickly to a loss of temperature, which could cause food spoilage.
In order to protect meat quality, two cold chain distribution systems in China will manage Smithfield imports. JD.com heads one system, the other is run by Henan Shuanghui Investment & Development Co – an Asian meatpacker also cooperating with JD.com and Smithfield on big data, traceability and under what the three parties call the Tripartite Strategic Partnership Agreement.
Shuanghui Development will help to introduce more of its own meat products on JD.com as part of the deal.
“Shuanghui Development will capitalise 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,” said Ma Xiangjie, vice-president of Shuanghui Development.
Richard Liu, JD.com CEO, added: “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 expansion in China’s e-commerce market comes after rival pork processor, Danish Crown, signed an agreement to sell online with e-commerce giant Alibaba.