Saturday, July 3, 2010

First Mover Advantage

My most recent post looked at the possibility that a private sector firm would decided to offer pick-up of items in automated lock boxes.   Looking over how these boxes are being used in Europe has identified what the real advantage could be: allowing Amazon and other internet retailers with multiple distribution centers to offer same day delivery.

Amazon offers same day delivery in seven cities with orders placed in most cities before 10:30 am.   Barnes and Noble offers same day delivery in Manhattan.   The growth of this same-day market is limited by both demand and the cost of home/business delivery relative to the cost of the item sold.

Same day delivery is of interest to Amazon and other internet-only retailers because they compete with companies like Best Buy and Sears that offer on-line sales with store pick-up.   Having a lock-box at least as close to a consumer's home as the nearest Best-Buy or Sears store would allow them to expand their same-day service to smaller cities at the same time they lower the cost of shipping those items.

The following video illustrates how picking up a shipment would work with either a notice left on a door or a notice e-mailed.  It is fairly straightforward.

While, the parcel collection and delivery locker solutions are relatively new, but in every country where they have been introduced there has been positive consumer acceptance and the company introducing the lockers made a second and in some cases a third order.  More importantly, as the ad for the lockers used by Deutsche Post shows, these lockers allow for better integration of e-mail, messaging, and smart phone technology used by consumers and businesses into the delivery process.  Something that will be critical as

These secure parcel lockers do not work for parcels that are too big or heavy to fit in the boxes provided. However for many electronics, software, and apparel shipments, this solution fits quite well.

1 comment:

Anonymous said...

Europe is by far more advanced in this concept than us. Fedex tested this in Chicago with SHIP and GET and it did not catch on. There are a few companies that have attractive ideas on a home based version that is value driven and affordable such as DeliverEZbox