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Welcome to our Postal Webinar Series

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Parcels TerminalsAn Update on Leading Business Models

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Parcels terminal networks: strong projections for growth

The e-commerce boom is pushing the rise of parcels terminal networks:

DHL: 2,500 PackStations in 1,600 cities.

Integer.pl: 16,000 easyPack terminals in Europe by the end of 2016

Itella Group: 350 stations by 2015

Post Denmark expanding from 131 to 200 “Døgnposten” units

Nightline plans : 400 “Parcel Motels”

The convenience of anywhere/anytime e-commerce is met by the convenience of anywhere/anytime pickup

Consumers delivery/pickup expectations are on the rise DHL’ Control Cockpit

GLS Germany’s FlexDelivery Service

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Sound business strategies for competitive advantage

To keep a competitive advantage parcels terminals operators must consider business models for:

Customer choice

Shipper Convenience

Increased Gain in Market Share

Improvement in Operational Efficiency

Financial Gain

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Two categories of business models

Customer drives delivery into

parcel terminal

Shipper drives delivery towardparcel terminal

Customer-driven Shipper-driven

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Pull models

Customer-driven

Operator-exclusive proprietary network

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Terminal Operator

Customer-driven

Customer Choice Choice of terminals may be limited

Shipper Convenience Shippers limited to ship with terminal operator

Operator’s Market Share Not likely to increase market share

Operational Efficiency Delivery to terminals is highly efficient

Finances (Terminal Operator)Low last mile costsCosts for deploying, managing terminals network

Customer Choice Choice of terminals may be limited

Shipper Convenience Shipper can pick carrier of choice

Carrier’s Market Share Not likely to increase market share

Operational Efficiency Preferred carrier may not offer time-definite commitments

Finances (Terminal Operator)Low last mile costsCosts for deploying, managing terminals networkSome revenue for partial handling of preferred carriers’ parcels

Carrier-agnostic, proprietary parcels terminal network (1)

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Preferred Carrier

Terminal Operator

Customer-driven

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Carrier-agnostic, proprietary parcels terminal network (2)

Customer Choice Choice of terminals may be limited

Shipper Convenience Shipper can pick carrier of choice

Operator’s Market Share Not likely to increase market share;

Operational EfficiencyInduction into depots efficient and not costlyPreferred carrier likely to offer time-definite commitments

Finances (Terminal Operator)Low last mile costsCosts for deploying, managing terminals networkSome revenue for partial handling of preferred carriers’ parcels

Preferred Carrier

Terminal Operator

Customer-driven

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Success factors: Carrier-neutrality Convenience for customer adoption

Open Platform of Parcels Terminal

Carriers Collaboration

Customer-driven

Terminal Operator

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Success factors: some examples

Open Parcels Terminal Platform

Carriers Collaboration

Customer-driven

Terminal Operator

Subsidizes UK retailers to host terminalsNightline

carrier-neutral approach

Parcel Select

Deploys Cleveron’s terminal with retailers in Baltic Countries

Rents space from supermarkets, gas stations, etc.

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Push models

Shipper-driven

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Various Push models are emerging

Shipper-driven

Proprietary solution with delivery by local carriers eCommerce

Field-engineering support

Supply Chain Solutions

All shipments to terminals; paid by Avon

Optional Shipment to terminals; paid by recipientsMulti-Level Marketing

Multi-Level Marketing

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Adoption rate vary, and depend on the business model/objectives

Shipper-driven

Partial push – terminals endorsed by shipperHigh adoption due to speed and cost of

service

Push-pull (collaboration)High adoption rate

Pure pushHigh adoption rate due to payment by

shipper

Partial push – terminals are endorsed by shipper

Recipients influence adoption rate

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What next?

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Growth opportunities for parcels terminals

Consumer-based

economy

Just-in-time

Supply Mgmt

• Large distribution centers are moving to suburban or exurban areas

• Proximity to road, rail, airport networks

• Lower cost of land

• Opportunity to service regional and national markets

• Increase in delivery trips from distribution centers to urban areas

• Congestion, noise pollution, CO2 emissions

• Urban consolidation centers

• Load consolidation among businesses to run joint delivery rounds

• Delivery during off-hours

New Approaches to Urban Logistics

Environmental Un-

sustainabilityLogistics Sprawl

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Growth opportunities for parcels terminals

Local online shopping Google shopping

Person to person commerce craigslit, oodle.com

Virtual shopping Tesco in South Korea Cencosud in Chile

Reverse Logistics Local recycling

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Opportunities for new business models

Open Platform of Parcels Terminal

Carriers Collaboration

Terminal Operator

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> insight > action > transformation