How do Parcelsea community lockers enable the Estonian national postal company, Omniva, to bring its services closer to customers' homes?

Omniva is a state owned post company, belonging to Universal Postal Union (UPU) among other 190 countries. To keep up with increasing parcel volumes and high competition, Omniva has invested into new sorting centres and expanded the parcel locker network across the Baltic States for more than a decade.

Like many UPU members, Omniva is witnessing a global trend in reduction of mail volume and a continuous increase in parcel volumes. However, while e-commerce is growing 6-7% year over year, the post companies are losing ecommerce parcel market share to big retailers like Amazon and Alibaba and to local or international competitors such as DHL, Itella, Venipak and DPD.

Omniva aims to be the most preferred carrier for B2C and B2B customers

In the local market, Omniva aims to be the most preferred carrier for both private and business customers. For that purpose Omniva began building a parcel lockers network in high density areas like shopping malls and supermarkets in 2012. As the solution stepped on the toes of their competitors, similar lockers of other brands were installed in similar locations. This has resulted in even greater competition with limited options for unique value proposition and price as the main differentiator for e-shoppers.

High infrastructure costs and increasing competition needs attention

While Universal Service Obligation requires Omniva to maintain the biggest sorting and delivery network infrastructure, the volumes are decreasing. The problem with high infrastructure costs and increasing competition has been at the attention of the Management for several years.

To concur the challenge, Omniva took a strategic step to start providing more personal, convenient last mile deliveries with the acquisition of the private parcel box network from Parcelsea in 2023. Moreover, the private parcel box service has been kept open for other carriers, to bring higher value to e-shoppers.

After seeing the initial benefits of having a close to home delivery network, Omniva saw a new opportunity to increase last mile efficiency and lower operational costs. Together with Parcelsea a new concept - community locker was developed.

Using community lockers developed by Parcelsea to tackle increasing costs and competition

The community locker pilot was kicked off in suburban areas, where the alternative locations are more than 2 km away from homes. The community lockers aim to serve up to 100 households within 300m radius. This is enough to avoid personal car drives to collect or return parcels from supermarkets.

Moreover, in order to reduce the delivery costs, the parcels are delivered to community boxes by using existing delivery networks, making the delivery routes as cost effective as to bigger parcel lockers. By doing this, the USO obligations are used to gain competitive advantage in the e-commerce delivery market.

The return of investment for one location is estimated to pay back in less than a year. After the pilot phase, Omniva is planning to expand the community locker network across Estonia, to both cities and rural areas.

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