Click and collect

Collection points

While some countries’ preference for home delivery largely surpasses alternative locations (e.g., in Belgium), other countries report an almost similar preference for home delivery and delivery at collection points (e.g., in France and Poland).

Authored by Heleen Buldeo Rai, last update on September 27h by Camille Horvath

The report by Ecommerce Europe (2020) demonstrates variations between countries. The Nordic countries (e.g., Norway, Sweden, Denmark) show a distinct use of collection over delivery at home. However, the 2022 edition of the same report indicates that the Covid-19 pandemic has resulted in some slight changes to these preferences. In the Netherlands, for instance, the popularity of parcel collection has decreased compared to 2020. This shift can be attributed to the government's decision to impose lockdowns earlier than other countries and the consequent shift towards working from home. Meanwhile, Hungary has experienced a significant increase in demand for home delivery services, with the number of Automated Parcel Lockers in the country tripling in 2021 (European E-commerce report, 2022). The E-commerce Europe 2022 report also reveals that offering parcel collection options is more important in Finland than in other European countries.

The figures below illustrate consumer survey results in terms of delivery locations for a selection of countries from the Ecommerce Europe 2023 report. As the report is composed out of various studies organised on the national scale, variations in questions (e.g., preference versus use of delivery locations), answer categories (e.g., home delivery versus home delivery in daytime and home delivery in evening) and survey approach (e.g., one versus multiple answer possibilities) impede straightforward comparison of country results. Yet general trends and differences therein are detectable nonetheless.

A survey by Star Service (2021) among 1,004 French online consumers conducted in September 2021 confirms the preference for home delivery. The report states that 57% of online consumers cite home or office delivery as their preferred delivery method. This score augments to 67% for the youngest consumers (i.e., 18 to 24 year olds) and to 65% for the oldest consumers (i.e., 65 year olds). A quarter of the French prefer delivery at a collection point. The preference is more pronounced among older consumers, with 29% of the over 50 year olds preferring them. 9% of the French prefer locker delivery. This preference is more marked among young people (i.e., 13% of the 25-34 year olds) and managers (i.e., 15%).

Similar consumer preferences have been observed in other countries, as per survey results. For example, in Romania, 30% of respondents favored delivery to pick-up points in the year 2022. Likewise, in Australia, more than half of the respondents preferred parcel pick-up points instead of home delivery, according to a survey conducted in 2021. Parcels lockers have gained popularity globally as a preferred collection point, as reported by Ma et al. (2022). These unattended self-collection points have experienced an increase in usage due to the COVID-19 outbreak and the need for contactless deliveries. A table depicting the rise of parcels lockers in various countries before and after the pandemic (Ma et al., 2022) is available below. In the Netherlands, Molin et al. (2022) have shown using discrete choice experiments that even a small increase in the prices for home delivery decreases the choice for this option considerably. According to the study, when the cost of collecting items at a service point exceeds 2€, a majority of consumers choose free pickup locations. Similarly, when the cost of home delivery surpasses 6€, a significant decline in the selection of this option was observed. Wang et al. (2023) also showed with a survey in Singapore that the prospect of social interactions can dissuade consumers from selecting attended delivery options, making unattended alternatives like home delivery and self-collection more appealing choices.

In analysing their “online consumption and mobility” survey among Parisians and New Yorkers, research bureau 6t (2018) shows the differences in delivery location between online consumers in Paris and New York. Doormen being the main mode of reception in Manhattan, they already receive 100 packages a day in New York (Jean Paul Rodrigue).

On the one hand, new types of retail settings emerged in the form of manned and unmanned collection points while on the other hand, existing retail settings adapted in the form of retailers’ stores serving as collection point for their online offer. “Manned collection points” follow a shop-in-shop concept and are often based in book and press stores, supermarkets and tobacco shops (Morganti et al., 2014). “Unmanned collection points” or automated lockers are self-service tools facilitated by technological solutions such as QR-codes and mobile phones (Vakulenko et al., 2018). They are located in public areas (e.g., parkings, bus terminals); semi-public areas (e.g., hospitals, shopping centres); and private areas (e.g., apartment buildings, workplaces). Both types of collection points are often exclusive to one logistics service provider, although research increasingly highlights the importance of common systems open to several or all logistics service providers (Goodchild et al., 2019).

Collection points’ advantages are listed by Buldeo Rai et al. (2020):

• More consolidation, more successful deliveries, more efficient delivery rounds, less vehicle-kilometres per delivery, less transport-time per delivery, less fuel consumption per delivery, less operational costs per delivery for logistics service providers. One report states that collection points account for approximately 40-50% of delivery costs (Różycki et al., 2021).

• More flexibility, more convenience, less waiting time, less risk of theft due to unattended delivery, more local pick-up (compared to depots) for consumers.

• More footfall, more revenue for collection points owners. However, Apur (2020) says that the remuneration (which varies from 30 cents to 3 euros per parcel, depending on the type) is often not sufficient to compensate for their service performed.

• Less emissions, less congestion, less noise, less sidewalk parking for society.

The European collection point network is developed by several logistics service providers. An overview is provided by Paazl (2018) in the figure below, demonstrating that DHL is leading the way with close to 50,000 locations, followed by UPS.

Based on postal operator data, the International Post Corporation (2018) illustrates the parcel locker market in Europe. It is interesting to observe that the locker model is underdeveloped in France compared to countries such as Spain and Germany. A rapid developed has however been noted since 2014, especially near railway stations, gas stations, major urban roads and shopping centres. The manned collection point model itself is very well established in France, which can be linked to the early development of so-called “point relais” for traditional mail order companies thirty years ago. Four competing networks exist in France (Apur, 2020):

• Chronopost/La Poste via its Pickup subsidiary

• Mondial Relay

• UPS (formerly Kiala)

• Parcel Relay

Analysis of the French model shows that the deployment of collection points is directly linked to population density and online order frequency. This means that urban areas have larger numbers of collection points than suburban and rural areas. In suburban and rural areas, collection points are more likely located in the centre and main commercial avenues (Morganti et al., 2014). The figure below illustrates the collection point networks in the Paris region. It shows that there are approximately 2,000 collection points in Paris, 3,000 in the mainland outside Paris and 3,500 in the rest of the Paris Region. Two-thirds of the population of the Paris metropolitan area is covered within 300 metres of these points (Apur, 2020).

While European lockers date back to 2002, in the United States such lockers were not implemented until Amazon began offering Amazon Hub locker services in 2011 (Keeling et al., 2021). Amazon Hub is the company’s umbrella brand for its Lockers (unmanned collection points) and Counters (manned collection points). Soon after, the United States Postal Service (USPS) launched a locker pilot in select cities and UPS developed their network. The Amazon Hub network is being developed as well in France. While the Lockers are well established in the Paris area, only fifteen Counters were found in June 2020. They were created in particular following a partnership with the Maisons de la Presse channel (Apur, 2020). At the end of 2020, almost 600 Maison de la Presse shops were listed as collection point on the Amazon website.

Stores and drives

Click-and-collect from the store is another alternative.

The French pure player Cdiscount, for example, has set up a partnership with the supermarket chain Casino to use their stores as collection points. In the Netherlands and Belgium, pure player Bol has set up the same collaboration with supermarket chains Albert Heijn and Delhaize. The physical stores of Darty and Fnac also serve as collection points for online ordered products on their web-shops. In the e-commerce market, online good and groceries represent a special issue due to the specific conditions of storage and handling of fresh and cold foods and the high costs of home delivery.

In contrast to an average product order, which often consists of one to three different items, e-grocery orders can contain dozens of items with many of those low value, perishable and in need of rapid picking and delivery. Whereas pure players in e-grocery set up warehouses for order picking and organise home deliveries (e.g., OCADO in the United Kingdom, Picnic in the Netherlands), omnichannel grocery retailers have to decide where to locate storage, order processing, picking and delivery activities.

At first, many choose to operate fulfilment in-store by means of a shelf-picking model, as a strategy in anticipation on online growth. As the online business grows, such retailers tend to switch to a dedicated picking model in warehouses, which offers potential for efficiency gains but needs a high sales volume to cover investment costs (Buldeo Rai, Verlinde, et al., 2019). Indeed, the profitability of e-grocery is a major issue, particularly in markets where gross margins are lower and labour costs are higher relative to the United Kingdom where for example Tesco and Ocado have made “assertive moves” (Galante et al., 2013). A few European retailers, notably in the French market where it is the only widespread model, launched click-and-collect services that potentially mark the tipping point for online grocery. As shown below, this model is more profitable than home delivery services. McKinsey research estimates as much as a 30 percent difference in margin (Galante et al., 2013).

For e-grocery click-and-collect, a specific type of retail setting has emerged, based on drive-through outlets or “drives” (Dablanc, 2018). Drives can be divided into four categories:

• A drive “picking” attached to the store with no storage (which is closest to the in-vehicle collection quite common in the United States);

• A delocalised and isolated drive in a standalone facility operated by the retailer (which is the most common but serves the least number of customers);

• A drive next to the store; and

• A pedestrian drive (which allows non-motorised collection within the city centre).

In some French small and medium size cities, retailers prefer to build drives rather than establish a new store in order to reduce costs and to be present against the competition. In France, the drive blew out its twenty candles on June 21st, 2020 (Leclerc, 2020). The network has been expanding steadily, its current growth notably prompted by pedestrian drives. A first pedestrian drive was opened by Leclerc in 2017 in Lille. Their goal is to offer a lower-priced (i.e., in average -17%) and larger (i.e., 12,000 references versus 6,000) product assortment compared to city supermarkets, without charging additional transport costs. Supply to the drive depot of approximately 50m² is made continuously through peripheral stores nearby.

Directory of drives Lebondrive.fr lists a total of 6,443 drives in France, of which Carrefour (1275 drives), Intermarché (1771 drives), Courses U (921 drives) and E. Leclerc (846 drives) provide the majority (LeBonDrive, 2023). In the United States as well, drives have been established in the commercial landscape, with Walmart for example relying more and more on this type of service in the past three years (Leclerc, 2020).

Next to click-and-collect, there are online grocery orders can be home delivered though retailers’ own vans (following in-house organised logistics operations) and third-party logistics service providers (following an outsourced logistics organisation). Research in Belgium found that omnichannel food retailers are inclined to insource home deliveries because of the sensitivities associated with food and the lack of adequate offer among logistics service providers (Buldeo Rai, Verlinde, et al., 2019). In France, Star Service offers home delivery services for food products, among others for the Casino supermarket group. Recently, food delivery platforms who initially focused on prepared meals only, are starting up collaborations with supermarket chains to deliver e-groceries between stores and homes.

Amazon offers a delivery service of food products as well, called “Amazon Fresh”. After a slow start, the service is very successful in the United States since 2013, but also in the United Kingdom (London) and Germany (Berlin and Potsdam), respectively since 2016 and 2017. The principle is a partnership between major brands (e.g., Coca Cola, Kellogg’s), supermarkets (e.g., Whole Foods in the United States, Morrisons in the United Kingdom) and logistics service providers (e.g., DHL, local carriers) (Dablanc et al., 2018). Amazon Fresh is reserved for Amazon Prime customers. Orders placed in the morning are delivered in the afternoon and afternoon’s orders are delivered the next morning. Amazon has since then bought upscale grocery chain Whole Foods in 2017 and set up cashier-less store facilities called “Amazon Go” in various cities in the United States in 2018.