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2. Parcels Terminals
An Update on Leading Business Models

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4. Parcels terminal networks: strong
projections for growth
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 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

5. Sound business strategies for competitive
advantage
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 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

6. Two categories of business models
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Customer drives
delivery into
parcel terminal
Shipper drives
delivery toward
parcel terminal
Customer-driven Shipper-driven

7. Pull models
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Customer-driven

8. 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 costs
Costs for deploying, managing terminals network

9. 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 costs
Costs for deploying, managing terminals network
Some 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

10. Carrier-agnostic, proprietary parcels
terminal network (2)
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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 Efficiency
Induction into depots efficient and not costly
Preferred carrier likely to offer time-definite commitments
Finances (Terminal Operator)
Low last mile costs
Costs for deploying, managing terminals network
Some revenue for partial handling of preferred carriers’ parcels
Preferred Carrier
Terminal Operator
Customer-driven

11. Success factors:
Carrier-neutrality
Convenience for customer adoption
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Open Platform of
Parcels Terminal
Carriers Collaboration
Customer-driven
Terminal Operator

12. Success factors: some examples
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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.

13. Push models
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Shipper-driven

14. Various Push models are emerging
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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 recipients
Multi-Level Marketing
Multi-Level Marketing

15. Adoption rate vary, and depend on the
business model/objectives
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Shipper-driven
Partial push – terminals endorsed by shipper
High adoption due to speed and cost of service
Push-pull (collaboration)
High adoption rate
Pure push
High adoption rate due to payment by shipper
Partial push – terminals are endorsed by shipper
Recipients influence adoption rate

16. What next?
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17. Growth opportunities for parcels terminals
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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-
sustainability
Logistics Sprawl

18. 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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19. Opportunities for new business models
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Open Platform of
Parcels Terminal
Carriers Collaboration
Terminal Operator

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> insight > action > transformation