As the world places more demands on Earth’s finite resources, are there things that we, in the logistics industry, can do to lessen our impact while providing higher levels of customer satisfaction? One of the biggest offenders in the industry is “last mile delivery.” Taking steps to improve delivery efficiency requires “blue sky” thinking, working with inventive third parties exploring new delivery methods, and a real desire to change entrenched processes.
Imagine…
If you could take a time-lapse video of your entire neighbourhood over the course of a day from a 500-foot perch. From above, concentrate on the courier delivery vehicles coming and going. You would be amazed at the level of activity – different courier companies delivering parcels on the same street, multiple times in a day.
Each delivery person stops, rings the doorbell, runs back to the truck with parcel in hand (because no one is home), or leaves the package on the porch at the mercy of Porch Pirates, and then motoring on to the next location. Rinse and repeat.
What you will witness is a massive web of different courier fleets trying to do their best. Their objective is to efficiently keep up with the rapid rise of residential parcel delivery driven by the growth in e-commerce.
As the day progresses, and from a higher vantage point, you’d be sure to notice the amount of traffic and sheer congestion that envelopes our neighbourhoods. This is even more evident in those areas with a high density of apartments and condos during peak hours when major routes are jammed.
Now imagine the sheer amount of energy required to deliver parcels to urban neighborhoods and suburbs across North America on a daily basis. It is truly staggering and the overall costs are going nowhere but up, given residential deliveries are expected to double over the next 5 years.
Deliveries All Day, Everyday
Contrary to perception, e-commerce has not alleviated the negative effect that consumer shopping has on the environment. It’s actually added to it. For example, 20 years ago you’d hop into the car and shop in store, driving from mall to mall before your purchases were complete. Now you research online, decide on a product and have it delivered.
On the surface, online shopping appears more efficient. But, the sheer number of deliveries made to a vast number of individual addresses has produced a net negative effect.
This “Last mile delivery” challenge accounts for as much as 50% of the total cost of making a residential parcel delivery. That’s not to mention the toll that’s afflicted on the environment and our air quality. There have been some novel potential solutions to this problem from some big players in the e-commerce world: drone parcel delivery, localized pickup hubs in convenience stores.
Drone delivery?..With limited real-life use cases, it will some time before drone technology will become practical, if ever. Not to mention the vast number of hurdles to overcome including government regulations and local ordinances.
Convenience stores?..not sure I’d want to trust my parcel storage to the part-time worker at the corner store. While they deserve merit for their originality, drones nor convenience stores have seen any traction.
The Solution
There is one solution experiencing success for the past five years in Asia and Europe. A solution fundamentally changing how parcels are delivered and picked up. They’re called “Smart Parcel Lockers” and the idea is simple.
Located in convenient urban centers and in the lobbies of multi-unit tenant buildings, these lockers provide a centralized drop-off point for couriers while enabling the consumer to pick up their parcels whenever convenient for them. It saves time and energy for the couriers who no longer need to navigate to each home or unit and provides a sure way of being able to successfully deliver parcels into tenant buildings with high rates of missed deliveries.
Further, significant energy savings are evident with online returns, running at around 30% of all online orders. Those shoes you ordered aren’t the right color? Pack them back up and drop them off at a Smart Parcel Locker. The proverbial “killing two birds with one stone” scenario.
A 292-slot residential Parcel Locker Serving 1,500 residents.
Smart Parcel Lockers can be installed at central locations in large commercial buildings. Consumers near the buildings get the option to direct their on-line order to their place of work, eliminating the need to leave early to make sure they’re home for the courier delivery (a request that is more frequent than imagined).
Looking from the outside, Smart Parcel Lockers make a ton of sense. Couriers are delivering their parcels when most consumers are at work. Employers eliminate the growing foot traffic and the interruptions caused by couriers running through their buildings while providing a valuable employee service.
There will be an estimated 18 billion parcels delivered in Canada and the US by couriers in 2018. By 2023, that number will be closer to 36 billion. If just 10% of today’s parcel deliveries were into a parcel locker network, the annualized savings on courier resources (personnel) would be 75 million hours. Not to mention the tremendous fuel savings.
Further, parcel lockers are open 24/7 and allow the possibility of courier deliveries made outside of normal business hours. This allows couriers to take advantage of low traffic and fuel savings of up to 30%. Green thinking is not only good for the planet, but will save a ton money. A win-win solution.
Smart Locker Benefits
Like every courier, you’re facing rising last-mile delivery costs and consumers looking for less expensive shipping alternatives that are convenient, private and secure. You also operate in a world that needs to lower the environmental impact of e-commerce. So how can you embrace Smart Parcel Lockers as a last mile alternative that meets these objectives?
- Collaborate with emerging companies building an open network of standardized Smart Parcel Lockers located in community locations, multi-unit residential dwellings, and commercial buildings usable by you in a transactional manner (pay for what you use).
- Experiment and pilot solutions that directly target your last-mile delivery costs. Smart Parcel Lockers are the one size fits all solution for retail partners. Reaching out to your retail partners will lead to greater adoption and ultimately lower costs for your company.
- Integrate your services with other last-mile offerings being developed by innovative companies to create hybrid solutions. Offer the solution as a single, cost-effective and superior alternative to better serve your on-line retail customers and their consumers.
- Focus your brand marketing on these new technologies and green thinking as a way of speaking to your dedication of driving change for the better. Offer incentives to help drive adoption of green alternatives. The greater the adoption, the more savings you should realize.
Here at ParcelPort, we’re passionate about a future that includes a network of Smart Parcel Lockers given their potential to positively impact couriers, consumers, businesses, and our environment. It’s a cleaner alternative that checks all the boxes.
To learn more about how your organization can maximize smart lockers to reduce cost, increase revenue, and delight your customers, contact the ParcelPort team online by visiting www.theParcelPort.com or calling 1-800-818-0870. Online shopping looks greener than traditional methods. But the sheer number of parcels delivered daily through eCommerce is having the opposite impact.