Posti simplifying the first mile

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Finnish postal service Posti is expanding its do-it-yourself online postage assessment. Are customers the winners? How do parcel lockers fit into this initiative? Ian Kerr (Postal Hub Podcast) and Marek Różycki (Last Mile Experts) analyze the advantages to customers and to Posti

Posti is switching to volume-based postage assessment for international parcels sent using its online platforms.

Customers can now measure their parcels at home and pay the correct postage online, instead of going to the post office. This follows similar measures introduced for domestic parcels prepared using Posti’s online platforms.

While customers don’t have to weigh their parcels, they must somehow make sure the parcel weighs no more than the maximum parcel weight in the destination country (typically 31.5kg [70 lb]). Maximum weight limits are available online. The minimum weight is 100g (0.2 lb) and minimum dimensions are 18 x 27 x 3cm (7 x 11 x 1in).

Price incentive
Customers can save money – as much as €5 (US$5.90) – by paying online instead of going to the post office. In post offices parcels are assessed by weight and volume, with the greater of the two being applied.

To give an example, right now the price of the cheapest international parcel in post offices is €28 (US$33) and the cheapest international parcel online is €22.90 (US$26.90). (Prices in post offices will increase by €1 (US$1.20) from October 1, 2018.)

Once the customer has paid postage, the customer either prints a label generated by the system, or writes a special code on the parcel along with the sender and addressee details.

Customers don’t have to use any specific packaging – they can use their own packaging then measure the size of the parcel. The only proviso is that customers remove any previous labels or barcodes on the packaging.

Parcel locker drop-off
Having paid postage online, customers can drop their parcels off at Posti’s parcel lockers. When paying, customers get a code to enter at the parcel locker, which then opens the appropriate locker door.

Depositing the parcel in the parcel locker triggers a notification event in the parcel tracking system.

Only parcels sizes S to XL (max 59 x 36 x 60 cm [23 x 14 x 24in]) can be posted using parcel lockers. All other parcels must be sent at post offices.

Posti is growing its parcel locker network, with a target of over 1,000 lockers by the end of 2018, making it more convenient for customers to send parcels at lockers.

Posting box drop-off
What of the humble posting box? Because of the posting box’s narrow opening, only domestic XXS parcels less than 3cm (1.2in) thick, as well as EMS XXS (formerly known as DocPac), can be lodged in posting boxes. These parcels don’t receive a scan until the parcel is processed at the sorting center.

Our take on this
This is simplifying the first mile for customers. Customers benefit from lower prices and streamlined parcel sending – which should mean reduced queuing times at the post office. The parcel locker network is growing, making parcel drop-off an attractive proposition.

The benefits to Posti include:
• Better ability to match parcels to lockers;
• Less work needed at the post office;
• Cashless prepayment;
• Electronic parcel data for overseas postal operators and customs;
• More customer data, which can help with network and capacity planning.

The game changer would be residential parcel lockers, which would introduce a new level of convenience. The issue here is the huge cost of implementation at scale and the fact that for rural areas, PUDOs or standard (non–residential) lockers would need to be used.

Let’s see what the take up will be, but given the growing cost pressures in the CEP industry, we can expect more ‘DIY’ initiatives like this.

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