Thoughts on OOH (Out-of-home) collection point density

As I wrote in a recent blog post the Baltics have some of the most advanced APM (automated parcel machine) delivery cultures in the world:

  • on average 0.77 parcels per person are delivered into APM each month
  • 85+% of people prefer APM delivery over door delivery
  • Estonia has (to my best knowledge!) 7 different, closed(!) networks available to end-customers per 1.3 million inhabitants

What makes me go OOH? One of the key reasons is the density of collection points.

In the suburb I live we have in total 6’504 (my German friends will laugh!) inhabitants and 7 APMs with 1236 compartments. That means a median compartment size of 176 compartments (largest 340, smallest 13 compartments). That means:

  • 0.19 compartments per person (or 0.12 compartments per 10’000 persons)
  • 5.26 persons per single compartment

Interestingly, the suburb where I live is a transit suburb between the capital (Tallinn) and several popular suburbs:

OOH location can act as “transit” location subject to commuters in both directions

 

If we consider additional commuters/population and additional APMs of the given county:

  •  The target (commuting) population, which should be considered for OOH density, is increased from 6’504 to 22’984 (my German friends are still laughing!) and the number of APMs is increased to 15 (2376 compartments, approximately). That means:
  • 0.10 compartments per person (also 0.10 compartments per 10’000 persons)
  •  9.67 persons per single compartment

So, what is the necessary OOH density (target population for OOH) to be considered by parcel operators in subject scenario? 0.19 compartments per person? Or 0.10 compartments per person? How should a parcel operator plan this?

Truth is that there are more variables than just plain density. Equally important are the end-customer commuting routes and it’s characteristics.  Successful operators must understand in detail the commute patterns of their target market around their OOH service points.

Taking my example – If we move on the map 3 km toward city of Tallinn (see picture added to this article), the outcome again is very different as additional capacity (APMs) become available to both city population (commute from city to suburbs), as well as commuters of the same county (commuters to the city). This illustrates clearly that location planning of OOH collection points is critical and people’s commuting patterns are much more relevant than purely the nearby population in certain radius of APM (1 APM per 10’000 inhabitants or similar).

This is by no mean the absolute truth but personally for me the location of the collection point must consider my commute pattern rather than being close to where I live. I don’t need to have an APM 300m from my home. I keep (strongly!) preferring OOH delivery until it is located somewhere close to my main journey be few kilometers away from where I actually live.

Any thoughts or comments?