Amazon Ramping Up Locker Rollout

Published in CSP Daily News

C-stores, other retailers can benefit from additional sales at time of pickup

SEATTLE -- To help combat failed package delivery, Amazon.com Inc. is ramping up its rollout of Amazon Lockers in convenience stores such as 7-Eleven and other retail outlets, reported The Wall Street Journal. The large metal cabinets accept packages for customers for a later pickup.

Amazon began opening Lockers in Seattle, Washington, D.C., and New York about a year ago. In just the past few weeks, Amazon has opened its first locker sites in the San Francisco Bay area, said the report.

(See Related Content below for previous CSP Daily News coverage.)

The addition of the Northern California locations brings to at least 50 the number of lockers that Amazon has in the United States, said the Journal, citing Amazon's website. The Seattle-based company also offers lockers throughout the U.K. and is "adding new Amazon Locker locations every week," it said.

Spokesperson Mary Osako declined to tell the newspaper how many lockers Amazon has or which cities it will target next.

After a package arrives, Amazon emails a code to customers who have shipped their item to a locker that unlocks the door holding their merchandise. The lockers--often housed in locations operating 24 hours a day--can hold only smaller items such as playing cards or books, and users have several days to retrieve the merchandise.

Users don't pay anything extra to use the service, but the locker program helps Amazon save on certain shipping costs.

"When customers ship Amazon orders to an Amazon Locker, they can pick up their packages at a time and place that's convenient for them," Osako told the paper.

Online retailers in North America have taken a variety of tacks to help ensure package delivery, said the report. ShopRunner, Conshohocken, Pa., earlier this year bought a startup called PickupZone to allow retailers to ship packages for pickup at other retail locations. So, for example, a customer can order a board game online from Toys "R" Us and have it delivered to a nearby Sports Authority store.

That is similar to a program offered by Kinek, Saint John, New Brunswick, which has about 1,000 sites where U.S. customers can have packages sent, such as postal stores and self-storage warehouses. Users pay a fee for their packages that are set by the stores.

Amazon, too, is experimenting with a similar service in the U.K., which it calls Collect+. According to the company's website, users can arrange to have packages delivered to shopping centers, c-stores, newsstands and train stations.

The Amazon Lockers initiative is "an interesting experiment for Amazon, though it's not clear it will be a huge business for them in the U.S.," Brian Walker, a Forrester Research analyst, told the Journal. "This could be much more important for them internationally if the test works, such as in China, where many consumers don't have home addresses that can accept packages."

7-Eleven and other store owners where Amazon is opening Lockers locations also benefit, the report said. Amazon customers may buy a soda or deodorant on their way out of the stores after collecting their packages, and Amazon pays a small fee each month, similar to rent. Store owners declined to tell the Journal what the fee was, and a spokesperson for 7-Eleven declined to comment.

The services are also attractive for customers with a particular need for privacy. "Adult products are still a very significant part of online sales," said Walker. "This certainly gives consumers a new way of getting those items."