UPS announced an expansion of its Access Point pickup program, with plans to add locations in all major U.S. metro areas by the end of 2015. The company did not say how many metros would be covered or the number of locations it would add.
Currently the pickup service is being tested out at 400 locations in Chicago and New York, mostly convenience stores and grocery locations that are open later and on weekends when UPS isn’t delivering. The company is considering signing on national retailers as pickup partners in the future, but for now it was simpler to negotiate with individual businesses.
In January, the 4,000 UPS Stores in the U.S. will also be added as Access Point locations. At the same time, the company is testing out nine pickup locker sites in Chicago, although that deployment will likely be much more limited.
UPS is also expanding its My Choice service, which lets customers determine where and when they want packages delivered, either online or via a mobile app. My Choice will now be available in 15 additional countries, including the UK, Austria, Belgium, Canada, Denmark, France, Germany and Mexico. There are more than 10 million My Choice members in the U.S.
“We’ve been focused the last couple years on how to develop a suite of services that provide great value for consumers, giving them convenience and control while eliminating friction in their ability to get a package,” said Geoff Light, president of product development at UPS, about the program expansions. “At the same time we want to figure out ways to help our retail customers grow their ecommerce business, and by default we grow as well.”
As for the pickup lockers, Light said the company will decide based on those results if that option should be expanded.
“We see them as more of a selective deployment, complementing our staffed Access Point locations,” he said. “There are circumstances where they fit, such as areas where we can’t find suitable locations that meet our criteria for a business location, including cleanliness, hours of operation and staffing. So if we can’t find a candidate that works in that location, the lockers serve a purpose.”
While the combination of My Choice and Access Point locations adds convenience and service for UPS’s residential and business customers, it also provides cost savings by reducing delivery trips and customer service calls, and increases network capacity as there are fewer packages on local route trucks.
Light said the pickup model has been used to great success in Europe before the U.S., as there are higher rates of unsuccessful delivery than is the case here. UPS got into the pickup location game in Europe via its 2011 acquisition of Belgium-based Kiala.
“When you think about European cities, there are several factors that make a difference, including the age of the cities, many houses close to the street, and small locations with no doormen,” he said. “Because of that failed delivery attempts are significantly higher, and so the need (for a pickup option) is greater.”
Now that UPS has seen how well Kiala works in Europe, Light said, “it’s absolutely applicable to the U.S. market. Although we deliver vast majority of packages without failure on the first attempt, where we do have challenges they are acute. Urban locations present challenges for all carriers.”
Light said UPS envisions the Access Point locations being used to facilitate returns as well as pickups.
“Our research with comScore has shown that providing hassle-free returns is a best practice in ecommerce,” he said. “Access Point locations substantially expand where customers can come and drop off returns. Enabling pickups and returns from the same locations can close the loop on making online shopping more convenient for both consumers and retailers.”