Out-of-home deliveries will grow significantly in Australia, solving important logistical problems for retailers, carriers, and consumers across the nation.
A last-mile expert forecasts that out-of-home deliveries will very soon make up a significant component of the last-mile market.
Marek Rozycki, Managing Partner at Last Mile Experts and former Vice President of Amazon Logistics Europe said that the cost of the last-mile accounts for approximately 41 per cent of supply chain costs.
“Out-of-home delivery is becoming crucial for the delivery sector because it offers a virtually guaranteed first-time delivery solution,” Marek said.
“It is also increasingly important to the overall consumer experience because is it currently the only way to manage massive volume growth without excessive service failures and cost.”
In his keynote address at the Hubbed ‘Future of PUDO Conference’ in Sydney last week, Marek said many consumers feel that home delivery methods are outdated, parcel collection point networks such as Hubbed are growing because they guarantee successful first-time deliveries and increase delivery density to collection points – both reducing costs for carriers.
According to UBS’s Evidence Lab report, online retails sales in Australia have grown at a 14 per cent (compound annual growth rate) for the past three years, and now make up around 9 per cent of retail sales.
Due to the ongoing surge in online sales, Marek predicts the three areas of out-of-home deliveries that will grow in Australia will be lockers, collection point networks, and click and collect services.
“In-store click and collect offerings also have plenty of space to grow, especially as consumers become increasingly environmentally driven in their choices and embrace greater control and convenience,” he said.
“By giving customers what they want, e-tailers can also build loyalty and drive income. In fact, the research shows that almost two-thirds of customers spend more when they use click and collect.”
David McLean, Founder and CEO of Hubbed said customers are expecting higher levels of service and choice when it comes to eCommerce.
“They are demanding more control post the purchase experience and this obviously includes delivery and collection,” he said.
“Coupled with the demand for more environmentally friendly options, means that sustainable shopping now extends to sustainable shipping. Pick-up drop-off (PUDO) and collection points, such as Hubbed, which has more than 2000 locations nationally, support this process from the get-go.”