PDD posts quarterly outcomes, unveils new initiative to strengthen the supply chain ecosystem

PDD Holdings, proprietor of Pinduoduo and Temu, just lately reported a 58% yearly enhance in income for the first quarter of 2023. The firm attributed the better-than-expectation efficiency to on-line retail restoration in China.

10 Billion Ecosystem Initiative

Along with the announcement of quarterly earnings, PDD additionally unveiled its newest main program, “10 Billion Ecosystem Initiative,” marking the firm’s third initiative price RMB 10 billion ($1.4 billion) following the “10 Billion Subsidy” and “10 Billion Agriculture” initiatives. The major goal of this plan is to allocate extra sources to high-quality sellers, aiming to improve the general service effectivity and high quality of the platform’s retailers.

This transfer aligns with the feedback made by Chen Lei, PDD’s co-CEO, throughout the earnings convention name. He emphasised the firm has been steadily shifting its strategic focus from pursuing fast progress to emphasizing the high quality of progress.

“Under our long-term strategies, we are continuously strengthening our supply chain capabilities and expanding the supply of high-quality merchandise. We will further increase our support for quality sellers by launching our 10 Billion Ecosystem Initiative and further improve the quality of our service while continuing to optimize our platform ecosystem.” Chen mentioned.

Started as a platform for promoting agricultural merchandise, PDD is thought for its steady and environment friendly supply chain. The firm continues to uphold its coverage of zero fee on agricultural merchandise. As a outcome, agricultural retailers spends about solely one-third to one-half on Pinduoduo than on different platforms. In early April, the firm appointed co-founder Zhao Jiazhen as co-CEO. Zhao, with in depth expertise in supply chains, focuses extra on supply chain administration and home enterprise operations, whereas Chen Lei leads world expansions.

The co-CEO lineup highlights the firm’s dedication to advancing supply chain growth and optimization. During the early days of the firm, Zhao performed a key function in general operations and supply chain growth in the agricultural enterprise. In 2020, he efficiently led the Duoduo Maicai group in pioneering the group group-buying enterprise mannequin in Jiangxi province.

According to numerous reviews, underneath Zhao’s management, PDD’s specialised groups will progressively discover 100 high-quality industrial hubs throughout a minimum of 10 provinces in China this 12 months.

A mature and sturdy supply chain depends on numerous and high-quality sources of products. Pinduoduo’s new main initiative seeks to uphold the firm’s place as a vital supply of products in the e-commerce business. The firm guarantees this program not solely entails offering monetary assist of billions of {dollars} to high-quality retailers, manufacturers, and small and medium-sized enterprises but additionally helping these retailers in increasing into worldwide markets.

Extra subsidy for 618

Ahead of this 12 months’s mid-year 618 purchasing pageant, PDD launched its 10 billion yuan subsidy program on April sixth, particularly focusing on dwelling home equipment and client electronics. In addition to the current subsidy, they’ll make investments one other to present further 10 billion yuan in subsidies for a variety of digital dwelling home equipment, together with smartphones, tablets, fridges, air conditioners, and others.

Major home and worldwide manufacturers comparable to Apple, Huawei, Honor, Xiaomi, Midea, Haier, Sony, TCL, Nintendo, Dyson, and Vivo have already participated in the program.

PDD may also collaborate with manufacturers like Midea, Haier, Xiaomi, Vivo, Asus, TCL, and Hisense to launch a sequence of factory-direct merchandise. Combining subsidies with direct gross sales to present higher reductions and advantages to shoppers.

By selling the direct connection between standard manufacturing facility merchandise and shoppers via subsidies and direct gross sales, this method advantages each the supply and demand sides. This initiative goals to supply shoppers aggressive costs and enhance the manufacturing sector’s restoration.