Today’s e-tailers know that the delivery of packages is a key element in their site’s success. Amongst other things, the flexibility and speed desired by e-shoppers mean a wide range of delivery options for orders is required, which has led to the development of pick-up points.
An alternative to home delivery
The continuous development of B2C e-commerce places certain constraints on urban logistics.
Pick-up points are the main alternative to home delivery, having the advantage of offering the end-customer more flexibility.
Another collection point solution is automatic lockers, which come in the form of a safety-deposit box, where a package is dropped before being collected by the customer at whatever time suits them. We will come back to this subject in a future article.
Home delivery is the preferred delivery option in most European countries, according to the ‘E-commerce and delivery’ survey (Copenhagen Economics, July 2013) carried out in Germany, Sweden, the United Kingdom, Poland, Spain and Estonia. The exception is Sweden, where the pick-up point is more widespread. The majority of purchasers (75%) said flexibility was the most important factor when considering delivery options, while 42% said that being able to choose a pick-up point or an automatic locker was important.
It’s therefore no surprise that today competitive pick-up point networks are being developed all over Europe in different forms – in post offices, businesses, petrol stations, shopping centres, etc.
These work in the same way as American convenience stores (local supermarkets) and Japanese ‘konbini’ (small local supermarkets, open 24 /7). Some cultures promote pick-up points more than others. PUDO (pick up, drop off) is more widespread in Scandinavia, where it is actually the standard means of delivery for packages. Why? Mainly for geographical reasons – the population is widely dispersed across the country – but also for convenience, with pick-up points in supermarkets and at service stations. Another explanation is that in Sweden the rate of unemployment is relatively low, so few people are at home during the day and home delivery is seen as less practical than in other countries.
An attractive and flexible solution
Pick-up points aren’t just a means to deliver packages to the consumer – they can also be used as locations for after-sales service. For example, they enable return, which may even be immediate, of unsuitable packages. They can also be used to leave packages where a home delivery has not been successful, thereby acting as a storage point.
Beyond this flexibility, the use of a network of pick-up points also has a financial benefit. To go back to the example of Sweden, delivering a package weighing 2 kg to a pick-up point is 4 times less expensive than when the package is sent to the customer. And with total distribution costs decreasing, the e-tailer will have a better margin for manoeuvre to make its prices attractive and may therefore see sales increase thanks to the PUDO option.
The PUDO solution also offers two ways of allocating pick-up points. With the ‘carrier-driven’ option, each delivery addressee has an assigned collection point, allocated by the delivery firm. Based on the address on the package, it will automatically be delivered to the assigned pick-up point. With the ‘consumer driven’ option, the consumer chooses the collection point on the e-trader’s website.
Landmark Global is the ideal partner for your international package dispatch and collection services thanks to its global PUDO network, which is being developed in France, Belgium and the Netherlands, and may soon include Russia and Spain.