Govt locker network offers better reach to HDB estates

First published by The Straits Times, on 09 March 2020

Last mile delivery

Operators of commercial parcel lockers here have said that a nationwide government-owned locker network will provide better reach in Housing Board estates, where the firms do not currently have lockers or the means to expand to.

The comments follow the Government's announcement last Tuesday of 1,000 locker stations to be rolled out by end-2022, to ease the increasing strain on delivery manpower due to the rise of e-commerce.

Couriers deposit parcels into the lockers by scanning a barcode, and an SMS notification is sent to the recipient with a passcode that must be input to retrieve the package.

The stations will be located in HDB estates, MRT stations and community centres, and will be within five minutes' walk of any of Singapore's 10,000 HDB blocks.

The Straits Times understands that installing one locker station can cost between $15,000 and $20,000, adding up to at least $15 million to provide them islandwide. This is not something private operators can afford to do on their own.

ST spoke to some firms that operate about 100 to 300 stations.

Local logistics start-up blu has about 130 locker stations in shopping malls, office buildings, convenience stores and petrol stations, and will continue to expand its network, said its founder and chief executive Prashant Dadlani.

blu and Singapore Post, which operates about 150 stations, jointly deployed 62 locker stations in BukitPanjang and Punggol in a trial launched by the Infocomm Media Development Authority (IMDA) in December 2018.

"The roll-out in public estates will complement existing networks... (and) will increase efficiency, productivity and provide benefits to consumers," Mr Dadlani said.

The nationwide network idea was also welcomed by local logistics start-up Parcel Santa, which operates 350 locker stations in condominium estates islandwide.

Its founder and CEO Jim Huang said: "The nationwide network strengthens our value proposition to condo (residents), because everyone else is getting (access) and they might be left behind otherwise."

But an industry insider, who declined to be named, said: "The nationwide network is competition for the private sector however you want to look at it. Having locker stations in prime locations with high accessibility such as HDB void decks is bound to affect traffic at existing (private) stations."

The Infocomm Media Development Authority has not announced how consumers will be charged, or if it will operate the network itself or appoint a firm to do it.

The pricing mechanism of locker stations tends to vary, but operators typically charge a rental fee to courier services that deliver to the lockers. Some of this cost is borne by the consumer and is often built into the price of goods or the delivery fee consumers pay on e-commerce marketplaces.

Self-collection from parcel lockers is seen as a viable alternative to doorstep deliveries because it saves consumers the hassle of waiting around at home to pick up non-essential packages, and helps couriers avoid wasted trips when consumers are not home.

Locker systems can offer lower cost and greater convenience to online shoppers, said logistics company Ninja Van's Singapore country head Ray Chou. "Compared to self-collection from parcel lockers, doorstep delivery is viewed as the more 'premium' service," he added.

This article was writted by Lester Wong and first published in The Straits Times.


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