Selling to JD self-run and Hema via a distributor

A foreign brand that wants to be a JD self-operated supplier usually gets there through a Chinese distributor. JD self-run buys stock like a retailer. It wants a guaranteed margin, takes back what doesn’t sell and pays about 60 days after the goods arrive. The distributor funds that gap. Your job is to price the guarantee into your ladder.

Here’s what the buyer asks for, in the words of suppliers who had to disclose it.

The figures come from two listed suppliers’ own disclosures on their JD self-run contracts, quoted with their sources in the next section. Every filing and rule here was checked on October 27, 2026.

How a JD self-operated supplier gets paid

JD runs two businesses under one app. Third-party stores sell their own goods and pay commission. JD self-run (京东自营) buys the goods, owns them and sets the shelf price. A brand selling to self-run is a vendor to a retailer, and the terms read like it.

JD’s retail accounts payable turnover days were 53.2 in 2023, 58.6 in 2024 and 60.0 in 2025. Inventory turnover days were 37.8 in 2025. Its suppliers include manufacturers, distributors and resellers, usually on one-year framework agreements. Source: JD.com (京东集团), annual report on Form 20-F for 2025, April 2026. https://www.sec.gov/Archives/edgar/data/1549802/000119312526157870/d53690d20f.htm

So JD holds stock for about 38 days and pays for it in about 60. The supplier finances the difference.

One instrument maker spelled out its contract when it went public. JD paid only for units actually sold, on a 60-day term, settled monthly, seven working days after the term ended. Before paying, JD subtracted whatever the supplier owed: price-cut compensation, returns, commercial discounts. Stock still unsold 30 days after it went into the warehouse counted as slow. If the supplier didn’t clear it with a price cut, it took it back.

JD settled on goods sold (实销实结) with a 60-day term, one settlement a month, and paid within 7 working days after the term. The supplier accepted returns for any reason and refunded price differences when it cut its price. Source: RIGOL Technologies (普源精电), reply to listing review feedback, December 2021. https://www.csrc.gov.cn/csrc/c100090/c1986821/1986821/files/发行人及保荐机构关于发行注册环节反馈意见落实函的回复.pdf

That filing covers 2019 to mid-2021. The newer one, from a maker of portable power stations, shows where the margin line went.

The company sold to JD self-run below JD’s shelf price and guaranteed JD’s book margin at a set rate (毛保点数): 5% to 8% before April 2023, 10% after. JD charged no other platform fee. JD issued a statement 45 days after the sale to the consumer and paid 7 days after receiving the invoice. Source: Jackery (华宝新能), reply to the Shenzhen Stock Exchange’s 2023 annual report inquiry, May 2024. https://static.cninfo.com.cn/finalpage/2024-05-31/1220224660.PDF

Note the word invoice. Settlement runs against a Chinese VAT invoice. A brand without a company in China can’t issue one, which is the practical reason the distributor sits in the middle.

Pricing the margin guarantee into your ladder

The guarantee is the term brands misread. It moves with the shelf price, and JD sets the shelf price.

Take an item JD sells at 100 RMB with a 10% guarantee. JD’s cost can be at most 90 RMB. Now JD runs it at 80 RMB for a festival. To keep 10%, its cost has to drop to 72 RMB, and someone pays the other 18 RMB a unit. In the contracts above, that someone is the supplier. (This is arithmetic on the disclosed rate, not a figure from a filing.)

Through a distributor, the supplier is the distributor. It will want that risk covered, either by a lower price from you or by a promotion budget you fund. Ask for the second. A lower list price is permanent, and a budget can be capped per festival and checked against JD’s statements.

Write down three things before the first order: the guarantee rate the distributor has agreed with JD, the cap on what you’ll reimburse in any month, and the statement you’ll see as proof. Our walk-through of how a distributor’s margin builds the shelf price shows where the guarantee sits among duty, VAT and the trade margins.

The cash gap your distributor carries

Here’s the gap in a listed distributor’s books. It imports two US pet food brands under a non-exclusive license and counts JD self-run among its main online buyers.

The company imports international brands as their distributor in China, and JD self-run is one of its main online customers. JD self-run buys from third-party sellers in advance or to match demand, then settles with them on actual sales and collections. Source: Tianyuan Pet Products (天元宠物), restructuring report summary, May 2026. https://static.cninfo.com.cn/finalpage/2026-05-27/1225331749.PDF

At June 30, 2025, the distributor’s largest receivable was 101.2 million RMB owed by JD’s trading company, 21.77% of its receivables. Its largest prepayment was 88.8 million RMB to the US brand owner, 52.31% of prepayments. Source: Tianyuan Pet Products (天元宠物), half-year report 2025, August 2025. http://static.cninfo.com.cn/finalpage/2025-08-26/1224566055.PDF

Cash out to the brand before shipping. Cash in from JD two months after the goods land. That’s the service.

A smaller distributor can’t stretch that far. If yours wants you to wait for JD before it pays you, it’s telling you its balance sheet. Treat that as a finding in the search, and check its payment record with the retailers it already supplies.

China’s payment rule covers companies set up in mainland China. That’s your distributor.

Large enterprises buying from small and medium-sized enterprises pay within 60 days of delivery. A contract may set another term, but it must follow industry norms and trade practice. The rule covers enterprises established in mainland China. Source: State Council (国务院), Regulations on Ensuring Payment to Small and Medium-sized Enterprises (保障中小企业款项支付条例), Decree 802, March 2025, in force June 1, 2025. https://www.gov.cn/zhengce/content/202503/content_7015401.htm

Large enterprises may not abuse their funding, channel or industry position to force clearly unreasonable payment terms on small and medium-sized enterprises. Source: NPC Standing Committee (全国人大常委会), Anti-Unfair Competition Law, article 15, revised June 2025, in force October 15, 2025, as republished by the CSRC Beijing Bureau, September 2025. https://www.csrc.gov.cn/beijing/c105536/c7582544/content.shtml

A Chinese distributor can lean on both when a buyer drags its feet. Your overseas company can’t, so your own payment terms with the distributor are the only protection you have.

Tmall Supermarket and Hema

Alibaba’s Tmall Supermarket (天猫超市) also buys to resell. Alibaba’s annual report books Tmall Supermarket’s sales gross, as goods it bought and resold. Not every supplier sells outright, though. A Sichuan pepper oil maker told the Beijing Stock Exchange in May 2026 that it consigns some stock to JD Supermarket and Tmall Supermarket and books the sale when the statement arrives.

Direct sales revenue primarily comes from Tmall Supermarket, Tmall Global and other businesses, with revenue and the cost of inventory recorded on a gross basis. Source: Alibaba Group (阿里巴巴集团), annual report on Form 20-F for the fiscal year to March 31, 2026, May 2026. https://www.sec.gov/Archives/edgar/data/1577552/000119312526231755/baba-20260331.htm

The company consigns goods to a few supermarket customers and books revenue when it receives their settlement statement, so some of its stock sits in warehouses named by customers such as JD Supermarket and Tmall Supermarket. Source: Yaomazi Food (幺麻子食品), reply to the Beijing Stock Exchange inquiry, May 2026. https://pdf.dfcfw.com/pdf/H2_AN202605281822944287_1.pdf

Hema, which Alibaba reports as Freshippo, is a supermarket chain with an app. It’s large and still inside Alibaba.

Freshippo’s GMV exceeded 107 billion RMB in fiscal 2026, Freshippo Supermarket ran more than 490 stores, and the business posted positive adjusted EBITA for a second year. Source: Alibaba Group (阿里巴巴集团), annual report on Form 20-F for the fiscal year to March 31, 2026, May 2026. https://www.sec.gov/Archives/edgar/data/1577552/000119312526231755/baba-20260331.htm

We found no filing that puts a number on Hema’s payment terms or margin floor, so we won’t give one. What’s on the record is how it buys.

Hema charges no channel fees, unlike traditional retail, and keeps two or three backup suppliers for an item, so a supplier that won’t agree is replaced. Source: Jiemian (界面新闻), November 2023. https://www.jiemian.com/article/10368586.html

No listing fee, then, and a buyer with a replacement on the phone. Your distributor’s price to Hema has to survive that call.

What to ask a distributor that says it supplies JD

A distributor that says it sells to JD may hold the supply contract itself, or it may sell to another company that does, and every extra layer takes a margin before the guarantee is even paid.

So ask to see a recent JD settlement statement (结算单), with prices blacked out if it insists. It shows whose name is on the contract and every deduction JD took that month. If the distributor can’t show you one, it isn’t the supplier of record.

Then ask how long its money from JD actually took last year, in days, against the contract term. Ask what share of its JD sales went back as deductions. A distributor that knows these numbers runs the account. One that has to look them up probably doesn’t.

Last, settle what happens if you part ways. The supply contract is in the distributor’s name, along with the receivable. Your agreement should say how unsold stock in JD’s warehouses is handled and who keeps the listing history, because a new distributor starts that relationship from zero.

What the other route ties up

The alternative is to sell through your own cross-border store and keep the shelf price. It costs cash of a different kind.

A cat and dog food store on JD Worldwide pays 2.5% commission and a 0.9% transaction fee, and ties up about 435,500 RMB before the first sale: a 35,500 RMB store deposit (US$5,000), a 100,000 RMB bonded warehouse deposit and a 300,000 RMB tax prepayment, all refundable. Source: TheChinaPath calculator data, October 2026.

That’s 3.4% a sale against a 10% guarantee, before the media and running costs a store of your own carries, and refundable deposits against a distributor’s receivable. Run your own category in the JD Worldwide setup and run calculator. The two routes can run side by side, self-run through a distributor for volume and your own store for price and launches, as long as the distributor’s contract says which goods go where.

Questions we get asked

Can a foreign brand sell to JD self-run directly?

Settlement runs against a Chinese VAT invoice, so in practice the seller of record is a company registered in China: your own subsidiary or a distributor. A brand without either reaches JD self-run through a distributor, which buys from you, holds the contract with JD and carries the payment term.

How long does JD take to pay a self-run supplier?

JD reported 60.0 retail payable days for 2025. Disclosed contracts show a 60-day term on goods sold, paid within 7 working days after it, and another settled 45 days after the consumer’s purchase, paid 7 days after the invoice. JD pays net of price-cut compensation, returns and discounts, so the cash is less than the invoices.

Does the margin guarantee change after we sign?

The rate is set in the contract, and one supplier’s rose from 5% to 8% up to 10% in April 2023. The amount you pay moves every time JD changes the shelf price, because the guarantee protects JD’s margin at whatever price it sells. Cap your share per month in the distribution agreement.

Every distributor in Compass has been met in person, and our guide to finding a distributor in China covers the terms to settle first. When the deal is signed, distribution in China covers the work that follows. Get a Compass shortlist of distributors in your category.