Warning: include(../../../FE_indexlocal.inc): failed to open stream: No such file or directory in /home/flogedelivery/public_html/magazine/HTMLheader.txt on line 18

Warning: include(): Failed opening '../../../FE_indexlocal.inc' for inclusion (include_path='.:/usr/lib/php:/usr/local/lib/php') in /home/flogedelivery/public_html/magazine/HTMLheader.txt on line 18
| On Track & On Target | Delivery solutions - driving home shopping growth
m-hance delivery management white paper
The definitive printed and online publication for the multi-channel fulfilment marketplace

Search our million-word thirteen-year archive


Warning: include_once(): http:// wrapper is disabled in the server configuration by allow_url_include=0 in /home/flogedelivery/public_html/magazine/left-panel.html on line 18

Warning: include_once(http://flog.edelivery.net//other/StartLocal.inc): failed to open stream: no suitable wrapper could be found in /home/flogedelivery/public_html/magazine/left-panel.html on line 18

Warning: include_once(): Failed opening 'http://flog.edelivery.net//other/StartLocal.inc' for inclusion (include_path='.:/usr/lib/php:/usr/local/lib/php') in /home/flogedelivery/public_html/magazine/left-panel.html on line 18
Subs promotion


RSS   F&E RSS news feed
Click for details



Paragon Software Systems


Ceewhy Vancouver


Automated Packaging


TRUCKSTOPS from MapMechanics




TNT Express Services


Access Fulfilment


Kuehne & Nagel


Kewill Ltd


TranSend Solutions Ltd


NetDespatch Ltd


Conveyor Networks


Pack Smart Ltd


The Fulfilling Station




iForce Ltd


EC Group


Courier Software


Spark Response


POS Direct Ltd




17 July 2014

Delivery solutions – driving home shopping growth

Locker boxes and drop-off points are no longer optional add-ons in the home shopping market, says Peter Rowlands – and they are playing an increasingly important role in its continued expansion

Warning: mysql_fetch_object(): supplied argument is not a valid MySQL result resource in /home/flogedelivery/public_html/other/routines.php on line 124

Warning: mysql_fetch_object(): supplied argument is not a valid MySQL result resource in /home/flogedelivery/public_html/other/routines.php on line 124


Right from the start of the internet shopping revolution, successful first-time delivery was one of the biggest problems. Home shoppers were often out at work, so deliveries failed. Simple as that. For many years, the problem didn’t really go away.

You might have expected massive growth in delivery solutions: alternative drop-off points, boxes outside people’s houses, the whole nine yards. Yet until recently, the retail and carrier communities paid only lip-service to such remedies, which therefore remained fragmented and marginal.

Not any more. It seems big business is now falling over backwards to create solutions to these problems. CollectPlus has more than 5,500 drop-off points in locations like convenience stores, and Hermes says it will have nearly as many of its similar ParcelShops in place by the end of 2014. Parcel carrier UPS is also rolling out its own UPS Access Point system, basing it on the experience of its continental subsidiary Kiala. It was aiming to have 2,500 in place by the end of 2013.

Polish-owned InPost says it now has more than 1,000 locker-box locations in place in Britain, and aims to add many more in 2014. Britain’s ByBox, with its longer history and more measured approach, says it has about 1,100 box-bank locations now.

And then there’s Network Rail’s Doddle: drop-off points at train stations (and possibly elsewhere in future). Although only in its early days, potentially Doddle could outperform all its rivals, simply because of its massive daily footfall of commuters.

Why this sudden rise in the fortunes of delivery solutions? The answer is probably twofold. On the one hand, internet shopping just keeps on growing. According to recent IMRG figures, the rate of increase has lately been running at nearly 20 per cent year on year. With volumes now running at 920 million packages a year, it seems retailers have finally been forced to address delivery issues head on.

However, there’s also a more specific explanation for the rapid rise in fortunes of delivery solutions: click and collect. Whether it’s a genuinely new phenomenon or just a new name for an existing concept is perhaps debatable, but it’s certainly "out there" now, and it seems to have given new respectability to the notion of delivery solutions.

This popularity is easy to understand. For as long as home delivery was taking consumers off the high street, bricks-and-mortar retailers remained ambivalent about it, if not unashamedly hostile. Click and collect changed everything. In its purest form, it brought shoppers back to the very stores they had apparently been abandoning. But retailers were pragmatic enough to realise that only the biggest among them had dense enough networks to cover all requirements. The rest needed backup to fill in the gaps; hence the popularity of services like CollectPlus’s.

True, a CollectPlus or ParcelShop visit doesn’t bring the shopper to the retailer’s own store, but it does make that retailer’s click and collect offer granular enough to be convincing to shoppers. In other words, offering the collection point option indirectly supports visits to the retailer’s own shops, assuming they’re in the right place. And of course that visit often does bring the consumer to a shop of some kind, even if not the retailer’s own shop. You could see it as a kind of mutual self-help thing.

So we now have three substantial and well-funded drop-off networks and two locker-bank services, all benefiting from backers turning over millions of pounds. It’s a dramatically different picture from that of ten years ago, when such networks were mostly the brainchild of start-ups with limited funding and often a lack of real awareness of the dynamics of an unproved market.

And all this is before you take account of Royal Mail, which has been building out its own delivery solutions portfolio. For instance, recipients can now elect to have Parcelforce Worldwide deliveries redirected to a post office of their choice (that’s more than 10,000 locations). Meanwhile, for years now Royal Mail recipients have been able to take advantage of its Safeplace scheme, under which goods can be left with a neighbour.

The integration challenge: has MetaPack hit on the solution?

Why don’t more retailers offer specific delivery solutions such as drop-off networks on the checkout pages of their web sites? In a word, the obstacle is integration – or rather, the complexity of it: not just integration at software level, but also in terms of the physical processes involved in setting up alternative carriers for the different destination types, and printing off correct labels for each item. Until recently, many retailers rebelled against the idea.

But from a consumer’s perspective, think how convenient it would be if, alongside next-day or three-day delivery, the web site offered "Drop off at a collection point" or "Leave at a locker bank" as further options.

Well, this is about to become a reality. MetaPack, the company that has become the byword for multi-carrier delivery management, is launching an add-on module for its software called Dynamic Delivery Options. In essence, this gives retailers the ability to incorporate a range of delivery solutions into their offer. In Metapack terms these solutions are called PUDOs (pick-up and drop-off systems).

Admittedly, the retailer has to strike a deal with each solution provider regarding price, availability and so on, but once that’s been done, MetaPack handles the integration, not the retailer. If the retailer is already a MetaPack user, there’s virtually nothing extra to do.

Simon Croft, MetaPack’s carrier account director, says retailers will have a choice of ways to offer the service. "They might just group all their PUDOs together. The shopper would enter their postcode, and would then be shown any PUDOs within range – probably on a map. These might be locker banks or convenience stores." Alternatively, the retailer will be able to specify each PUDO option separately.

MetaPack already does integrate with some PUDO suppliers, including ByBox; but this works partly because such companies are carriers in their own right. The Dynamic Delivery Options system works somewhat differently, treating each PUDO supplier as a kind of "virtual carrier". As Croft puts it: "The actual carrier used by that supplier is immaterial; the system just treats the PUDO company as the carrier."

What do the solutions providers think of this? We wondered if they would feel they were losing competitive edge by entering into a scheme that also incorporated rivals. Not at all, says Simon Croft. "Some of operators of the newer systems have actually come to us, asking if they can be included in something like this."

When we closed for press, MetaPack was already in advanced talks with six such providers, and Croft says the total could soon reach seven or eight. Among those are known to have signed up to the system so far are InPost, the locker network, and local letterbox, the innovative drop-off network.

The system is due for launch this July, and if it lives up to its promise, could be one of the most significant developments yet in establishing alternative delivery solutions in the home shopping mainstream.

It’s been a remarkable turnround. Delivery solutions, which for a long time were a marginal function in the home shopping landscape, are now playing a significant role in feeding its growth. They may not represent home delivery as such, but they do offer delivery that suits shoppers – and retailers seem to be buying into this.

Indeed, some suppliers are pushing forward with some quite wacky new ideas for making delivery even easier. Asda, Tesco and Waitrose have all been trialling London Underground car parks as possible locations for their deliveries, and Waitrose has been trialling deliveries to a locker bank (built by ByBox) with refrigerated compartments for holding temperature-controlled goods.


Meanwhile InPost went live with its first locker bank in a Transport for London car park shortly before we closed for press. For TfL read Undergound; such locations will be adjacent to Underground stations.

It is not the only company in this space. Amazon.co.uk has now also started placing locker banks in Underground car parks. The first two are now live at Finchley Central and Newbury Park stations. Amazon has not at this stage stated explicitly that there will be more lockers at similar locations, but that seems to be the inference of its announcement.

Volvo Cars is even floating a concept in which deliveries might be made to a recipient’s parked car, ready for taking home at the end of the day. It might be a blue-sky notion now, but who knows where it might lead?

In the early days of delivery solutions, a lot of attention was focused on the idea that consumers might decide to have a secure delivery box (like an outdoor safe) mounted near their front door, where large packages could be left by a delivery driver. The more ambitious examples even incorporated electronics that could send a text to the recipient to report that the delivery had been made.

Bearbox was a pioneer of the more sophisticated variety, but later the baton was picked up by ParcelPal, whose box was integrated electronically with a front door entry phone. The driver rang the bell, and the recipient was automatically called up anywhere in the world, and could unlock the box from their mobile. Sadly, the company couldn’t create enough traction to bring prices down to affordable levels. When we last checked, its web site was no longer available.

Even more ambitious is the Shopbox, a multi-temperature box suitable for receiving grocery deliveries outside the shopper’s house. It was developed by the directors of Archbold, the transport and logistics group, and spearheaded for several years by Andy Leslie, who had high hopes of winning active support from at least one supermarket chain. He has now reluctantly left the company, but Stuart Archbold from the founding company says it is still very much a live project, and he hopes to have "something very interesting" to report later this year.

Meanwhile, simpler boxes remain available. The original Hippo Box, now renamed the Hippo Dropbox, has a new web site and is now marketed by AV Innovate, the engineering company that manufactures it. Others such as the Parcel Pod, the iBin and the Brizebox are also available, and it remains something of a mystery why these are not more actively supported by carriers and the retail community.

Their suppliers might take comfort from the fact that the delivery box concept has just been revived in Germany by no less an organisation than DHL, the leading home delivery operator, which now offers its Paketkasten for sale or rental to shoppers (News Update, page xx).

DHL also pioneered the box-bank concept in Germany, and is a striking example of a carrier that has taken these delivery solutions to heart. No UK carrier has so far embraced such concepts with the same vigour, but DHL’s lead demonstrates what is possible.

The box-bank concept is alive and well in the UK, of course, under independent ownership. During the past year the originator of the concept, ByBox, strengthened its market presence by acquiring the similar ParcelXchange network operated by carrier DX, adding 400 box banks to its existing network, which now approaches 1,100 locations.

It is still not the sole supplier, though; Polish rival InPost is investing millions in setting up a rival network here – aiming to replicate parallel growth in numerous other markets around the world. Unlike ByBox, which has its own carrier network, InPost is carrier-neutral in the UK, though it is aiming to establish a range of relationships with various carrier partners.

Stuart Miller, ByBox’s founder and a lifelong enthusiastic of the concept, says he is sanguine about this new rival. "You can’t make a market with just one supplier," he says. However, he remains cautious about any delivery solution that involves a significant cost to the consumer.

"We’ve found in trials that the consumer’s choice of delivery option is highly price-sensitive," he says. He says his company’s experience is that any charge above about £1.50 will act as a significant deterrent to shoppers who might otherwise have used the service. "The hard reality is that consumers are willing to tolerate a lot of inconvenience in exchange for free delivery."

InPost’s commercial director, Michelle De Pasquale, agrees that extra delivery cost is a turn-off for shoppers, and says his company’s intention is to achieve a price level low enough for retailers to offer it as a no-cost option. "Because we’ll be delivering multiple consignments to single locker-bank destinations, the economics will help contain costs as volumes grow."

ByBox’s Miller continues to advocate the idea of providing judiciously-placed lockers rather than aiming for blanket coverage, and is also keen to talk up the idea of making the boxes a community asset. "Local suppliers such as retailers and shoe repairers can use them to leave out product for customers to collect, and the box itself can offer users bonuses like savings at local cafes."

ByBox has been working with local authorities in Oxfordshire to establish box banks in the very centre of small-town retail areas, and is now developing a similar concept in Bedfordshire.

Locker banks now seem to be establishing themselves on a worldwide basis. InPost is already active in more than a dozen countries, and ByBox too has partnership agreements or direct operations in a range of other countries. Meanwhile, local operators such as DDD of Luxembourg are reinforcing market penetration, and Amazon has a modest network of its own locker banks in place in various locations including the UK and America.

Amazon locker banks work in much the same way others of their kind, but differ in one fundamental aspect; they are only for Amazon customers. This means they don’t add anything to the pool of resources available to the e-commerce world at large, though they are undoubtedly helping establish the concept of locker banks in the public mind.

The network is growing steadily. Amazon says it now has nearly 300 UK locker banks in locations such as shopping centres, supermarkets, universities, libraries and now Underground car parks. The company offers free one-day delivery to the lockers for its Amazon Prime customers, and one-day delivery for £1.99 for others, as well as free standard delivery for anyone spending over £10.

One new contender in the delivery solutions market, Local Letterbox, has just repositioned itself. Originally it planned to set up a network of high-street shops dedicated to receiving home deliveries – similar to CollectPlus or Hermes’ ParcelShops, but run independently on a franchise basis instead of relying on hosting by existing shops.

It still aspires to this high-street presence, but has now also launched an intriguing new hybrid system under the branding parcelpod (no connection with the existing Parcel Pod drop-box). It incorporates some elements of high-street collection points and locker boxes in a completely new combination.

Parcelpod revolves round a free-standing storage module that looks a bit like a locker bank, and can be installed in a location such as a shopping mall. Consignments are held here for collection by consumers, but unlike a locker bank, the location is staffed. A further differentiator is that in many locations a changing room will be provided in a separate but similar module.

The idea is that home shoppers picking up garments will be able to try them on, as if they were in a shop, and then return them to the supplier immediately via the Local Letterbox system if they’re not satisfied for some reason. Deliveries and collections will be handled by Norbert Dentressangle, which it has named as its logistics partner.

The Isle of Wight-based company ambitiously plans to roll out 500 of these locations this year, including further high-street shops, and says there will be no charge to use them over and above the retailer’s standard delivery charge.

The company has just revealed that it is working with Norbert Dentressangle as its logistics partner – another first, since previous delivery solutions suppliers have tended to work only with carriers, not with organisations having more wide-ranging warehousing and fulfilment expertise. How this will evolve remains to be seen.

Clearly delivery solutions market is growing at a pace that would have been unimaginable a decade ago, and is now well and truly established as part of the home shopping revolution. And where there’s growth, there are always new contenders, so don’t assume innovation has run its course yet. What we’re seeing now could be just the beginning.


Other stories in this issue


Top of page