The latest report from Last Mile Experts (LME) has revealed the biggest trends and challenges facing the out-of-home (OOH) delivery market in Europe, as well as the companies who are winning in the sector.
The Out of Home Delivery in Europe 2024: PUDOs and automated parcel machines report, published on June 26, explores the developments in the e-commerce sector and how the OOH market is evolving.
“Our report is the only study of its kind in Europe, and perhaps the world, which shows an annual comparison of OOH networks, new players and statistical data based on our internal analyses,” said Mirek Gral, Last Mile Experts‘ vice president responsible for the preparation of reports.
“Each edition of the report is expanded to include new aspects related to the development of the PUDO and automated parcel machine (APM) networks, which is appreciated by our readers.”
Key findings
According to the report, the e-commerce market in Europe is now showing signs of recovery after facing a downturn in 2022. Last year, the market grew by approximately 2% after adjusting for inflation, partly driven by the rise in out-of-home (OOH) delivery solutions that are proving to be financially and operationally beneficial for e-commerce. OOH delivery, including parcel lockers and PUDOs, supports e-commerce by providing convenient and cost-effective delivery options.
The mutual support between OOH delivery and e-commerce (and particularly re-commerce) is evident. OOH delivery solutions make e-commerce more viable, while the growth of e-commerce fuels the expansion of OOH networks. In 2023, the volume of business-to-consumer (B2C) e-commerce in Europe was estimated to grow by 4.9%, surpassing initial expectations of 3.9%. This growth is across 32 countries in Europe, including Ukraine, Russia and Turkey, amounting to an estimated 19 billion parcels.
The rise of Vinted and re-commerce
Consumers are increasingly turning to consumer-to-consumer (C2C) platforms like Vinted and OLX for second-hand goods. The popularity of these platforms is driven by the dual appeal of lower prices and sustainability. Cost inflation has pushed more consumers toward pre-owned goods, and many brands are now participating in re-commerce through take-back schemes. In fact, the European re-commerce market was valued at around €75bn (US$80bn) in 2023 and is expected to grow to €120bn (US$128bn) by 2025, and will be a key engine for e-commerce volume growth, according to LME’s report.
Sustainability in logistics
Sustainability is a key concern in the European e-commerce landscape, affecting all aspects of the logistics chain. Green last-mile delivery options are gaining traction, although the issue of greenwashing persists. Economic realities and consumer preferences are driving the adoption of efficient OOH solutions that offer a greener and more efficient last-mile delivery option while saving costs at the same time.
Technology is opening new opportunities and applications of OOH
According to the report, locker technology is developing to offer next-generation battery-powered APMs that offer all the key peripherals of a traditional machine without the need for a stable power source, and which can be commissioned in a matter of minutes. This further increases the ability to add APMs in areas where traditional lockers or even PUDO points may not be viable.
OOH delivery expansion
Investment in OOH delivery options remains robust, reflecting a commitment to sustainable and efficient delivery solutions. The density of OOH networks is crucial for further e-commerce growth and the development of new segments like C2C and re-commerce. Europe leads globally in the adoption of OOH delivery, with consumer preference for home delivery dropping from 73% to 64%.
In 2023, the number of APMs grew by 29% to 154,900, and PUDO points increased by 6% to 349,230. Key markets for PUDO points include the UK, France, Italy, Germany and Poland, while Poland, the UK, Germany, France and the Czech Republic lead in APM deployment.
The leaders in OOH
Several carriers dominate the OOH delivery landscape. Deutsche Post/DHL, DPD Group, GLS, InPost, and UPS are the leading operators, with extensive networks of PUDO and APM points. InPost showed the highest growth in PUDO points with a 32% increase, while GLS led in APM growth with a 125% increase over 2022.
In terms of mastering OOH financial return, InPost is the clear leader with reported EBITDA of some 45% in Poland. A ‘dark horse’ which has joined the report for the first time is Nova Post (Ukraine, Switzerland and Norway have been included this year’s report) with an incredible 16,000 APMs and over 11,000 PUDO points.
Future trends and partnerships
The future success and expansion of OOH delivery will depend on strategic deployment and partnerships. At LME, we firmly believe that collaborations between carriers, such as those between DHL and Cainiao or Poste Italiane, are essential for creating efficient and customer-centric last-mile solutions. As space for OOH infrastructure becomes limited, innovative deployment strategies and alliances will be critical for sustaining growth and meeting consumer demands.
In conclusion, the European e-commerce and OOH delivery markets are poised for continued growth and transformation. The emphasis on sustainability, technological advancements and strategic partnerships will shape the future of last-mile delivery, offering consumers more efficient and eco-friendly options.
The Out of Home Delivery in Europe 2024: PUDOs and automated parcel machines report is available for free thanks to Parcel Pending by Quadient.
Parcel & Postal Technology International is the exclusive media partner for the report.
For more information and a free download of this and other LME reports, please click here: https://lastmileexperts.com/reports-subscriptions/