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German supermarket chain Lidl is marrying the last-mile of offline and online shopping

German food retail chain Lidl has announced a cooperative agreement with Deutsche Post DHL Group to add 500 DHL Packstations to Lidl stores this year in an attempt to fuse shopping between offline retail purchases and online ecommerce. Customers can shop at a Lidl store, while also conveniently picking up their online purchases from the DHL Packstation installed at the store. 

“The partnership will benefit all sides, and especially our customers, as 500 more DHL Packstations are being built in easy-to-reach, attractive locations, and the new Packstations are an important part of the promise we’ve made to our customers for further enhanced service quality,” said Martin Linde, sales manager of the German Mail and parcel division of the Deutsche Post DHL Group.

The rise of ecommerce presents a compelling case for logistics in the context of last-mile distribution. For instance, though Amazon has an enviable market capitalization, the company had historically depended on freight forwarders like UPS, USPS, FedEx and DHL for its last-mile delivery. Though Amazon has recently looked at growing its own last-mile delivery network to exert greater control over its operations and reduce logistics costs, the delivery precision is yet to work at the anticipated level.

Businesses are looking for methods to reduce the costs of last-mile delivery and their carbon footprint. An added burden to ecommerce-related last-mile distribution is the short delivery windows. With consumers expecting quick delivery of their online purchases, businesses are forced to sacrifice efficiency for expediting shipments, which eventually impacts their logistics costs. 

DHL Packstations are offline storage stations that receive parcels for people who are not at home or are on the move. Once the user gets notified of the package being delivered at the Packstation, he can proceed to drop by and get the parcel at his convenience. Alternatively, these stations could also be used to drop off packages. 

The cooperation between Lidl and Deutsche Post enables customers to pick up or drop off packages at the DHL Packstations before or after shopping within the Lidl branch. Apart from saving time and resources for the delivery companies, it also considerably reduces the carbon footprint of these transactions, while also reducing unnecessary last-mile delivery vehicles on the road. 

“Nobody wants to spend their spare time traveling long distances, so we offer our customers a further service directly at our branches with DHL Packstations and bring the digital world directly into the Lidl branches,” said René Engel, member of the management board at Lidl Germany.

For the pilot run, DHL Packstations have been placed in 12 Lidl branches, including ones in Berlin and Hamburg as a way to test their acceptance among customers. Buoyed by a good response, Deutsche Post is moving ahead with installing the rest of the DHL Packstations in the identified Lidl storefronts. 

That said, the relentless push by Deutsche Post to bolster its technology and infrastructure is also commendable. The partnership creates 5,000 additional posts for its letter and parcel segment, and 1,000 new DHL Packstations to reduce redundant last-mile delivery movement and provide consumers the ‘offline element’ to ecommerce shopping. 

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Vishnu Rajamanickam, Staff Writer

Vishnu writes editorial commentary on cutting-edge technology within the freight industry, profiles startups, and brings in perspective from industry frontrunners and thought leaders in the freight space. In his spare time, he writes neo-noir poetry, blogs about travel & living, and loves to debate about international politics. He hopes to settle down in a village and grow his own food at some point in time. But for now, he is happy to live with his wife in the middle of a German metropolitan.

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