E-commerce and, by extension, B2C deliveries have been accelerated during the pandemic. Changes in consumer behaviour have driven growth in delivery networks across the Consumer Markets industry. Out-of-Home (OOH) delivery, including pick up and drop off (PUDO) points and automatic parcel machines are playing an increasingly important role as retailers and e-commerce businesses evolve to address last mile delivery challenges.
Note: Data represents total out of home (OOH) deliveries as a % of total last mile deliveries
Exclusive data from Parcel Monitor reveals that home delivery remains the preferred delivery method worldwide. Consumers still prefer traditional home delivery options, and a high preference for home delivery can be observed across most regions. As shown above, alternative delivery networks were most popular in Oceania during Q3 2021, with 13.4% of parcels being delivered through OOH networks. Asia, North America, South America, and Africa consumers all demonstrate a desire for home delivery methods.
The most popular OOH delivery method across all regions was collection points (CPs). Oceania now has the highest proportion of shoppers opting for CPs in Q3 2021. According to Parcelmonitor, whilst CPs are a newer addition in New Zealand, this trend was already observed in Australia since the start of 2020. A 2021 Australia Post Delivery Experience Report stated that CPs can help increase the success rates of first-time delivery and offer those living in apartments safer delivery options.
Source: Parcel Monitor
Among all regions, Asian consumers are most likely to pick up parcels at the Post Office. According to Parcel Monitor, post offices have risen back up in popularity as restrictions ease and people return to work. Parcel Monitor also reported that ease and convenience are often two critical factors that influence Post Office usage; performance-wise, Japan and Singapore’s postal services were among the top 10 in the world.
* Note: Parcel Monitor data for Oceania and South America includes both parcel shops and post offices. North America data includes parcels delivered to post offices, parcel lockers and parcel shops.
Parcel lockers were used the most in Europe, with 1.48% of parcels delivered to lockers. European Express providers have announced significant investments in expanding their parcel locker networks during 2021 and have identified alternative networks as a strategic priority. For example, DPD has begun expanding its parcel network across Estonia and Portugal. CEO of DPDgroup Yves Delmas commented that the locker was the “perfect delivery point in terms of productivity […] in many cities we open lockers because there are no more shops available […]in the next 10 years there will be room for home deliveries, PUDO deliveries and locker deliveries”. Both Hermes and GLS have also expanded their locker networks across Europe during 2021.
*Note: Parcel Monitor Data for North America includes parcels delivered to post offices, parcel lockers and parcel shops. Parcel locker data was not reported for South America and Africa.
According to a Last Mile Experts report, customers demand greater flexibility and transparency, and often value the fact that there are various delivery options via online shopping. Consumers are also becoming more conscious of their environmental footprint; OOH networks often offer a more sustainable alternative to home delivery. For providers, OOH networks provide around 3-4 times more efficiency per route. Locker routes can serve up to 800 parcels versus around 200 for a dense door to door urban courier route. As OOH networks allow the consolidation of shipments, both delivery costs and average delivery time can be significantly decreased.
OOH network developments have also been driven by the C2C market; according to DPD Executive Vice President Jean-Claude Sonet, the market is expected to grow by 30% throughout Europe in the coming years, with around 90% of this growth linked to OOH delivery solutions.
Home delivery options remain more popular than OOH networks at present. However, their efficiency, low-cost and sustainability have not been lost on providers. Additionally, it has been estimated by the Last Mile Experts report that by 2025 OOH deliveries will represent over a quarter of all parcel deliveries. With parcel volumes expected to double between 2020-2025, the current infrastructure cannot feasibly do the same; it is this logic which is most likely driving network investment amongst some providers.
Want to learn more about the top last-mile delivery methods around the world? Check out Parcel Monitor’s full article here!
Source: Parcel Monitor, 14 December 2021
Author: Nia Hudson
GLOBAL SUPPLY CHAIN INTELLIGENCE (GSCi)