Unlocking the Last Mile: PUDO, APMs and the Rise of Out‑of‑Home Delivery

We've all been there – you walk up to your front door, excited about a delivery, only to spot that annoying "Sorry we missed you" card waiting on the doormat. It's one of those frustrations that online shoppers know all too well. Now you're stuck waiting around for another delivery attempt or making a trip to some pickup location across town.

This whole scenario highlights how tricky the last mile can be. It's the most expensive and problematic part of getting orders to customers. Failed deliveries increase expenses for both the retailer and the carrier, while customers are unhappy about having to wait longer.

That’s why a growing number of businesses are turning to Out-of-Home (OOH) delivery solutions that use parcel lockers or Pick-Up Drop-Off (PUDO) points as alternatives to home delivery. By directing parcels to secure, centralised locations, OOH solutions reduce failed deliveries, cut down on unnecessary journeys, and give customers more flexibility over when and where they receive their orders.

What started as a niche service has become a mainstream choice, driven by customer demand for convenience and reliability. For retailers, it offers efficiency and cost savings. For shoppers, it delivers greater control and peace of mind. It's a win-win situation that makes the whole delivery process work better for everyone involved.

The Benefits of OOH Delivery for Customers and Retailers

The appeal of Out-of-Home delivery lies in its ability to solve pain points for both customers and retailers. By offering greater convenience for shoppers and improved efficiency for retailers, it creates advantages across the board.

For the Customer

Modern shoppers expect flexibility and control over how they receive their purchases. OOH delivery provides exactly that:

• Convenience and Control: Customers no longer have to stay at home during a delivery slot or rely on a neighbour to accept a parcel. Instead, they can pick up their order from a nearby PUDO point or locker at a time that fits their day.
• Security: Package theft, often called porch piracy, is a growing concern. Collecting from a staffed point or secure locker gives peace of mind, removing the risk of parcels being left unattended.
• More Choice: Offering OOH alongside traditional home delivery shows that a retailer understands different lifestyles. By letting customers decide how they want to receive their orders, businesses can enhance the overall shopping experience.

For the Retailer

Beyond customer satisfaction, the operational and financial benefits for businesses are clear:

• Lower Costs: The last mile is the most expensive stage of delivery. Consolidating multiple orders into one OOH location reduces fuel use, driver time, and vehicle mileage. This cuts the cost per parcel, freeing businesses to reinvest or pass on savings to shoppers.​​​​​​​
• Greater Efficiency: A driver can drop off dozens of parcels in one stop instead of making individual deliveries. This increases productivity and leads to far higher first-time delivery success rates, eliminating the time and money spent on redelivery attempts.​​​​​​​
• Sustainability: Fewer journeys mean a smaller carbon footprint. OOH delivery supports greener logistics, aligning with rising consumer demand for environmentally responsible options. It represents a practical step towards more sustainable eCommerce operations.

UK Consumer Trends

Research shows that consumer behaviour is shifting quickly, with growing demand for the flexibility and convenience offered by parcel lockers and PUDO points.

Parcel lockers in particular have moved from a niche option to a mainstream habit. Recent studies reveal that two in five UK adults - around 21 million people - used a locker in the past year to send, collect, or return a parcel. That scale of adoption signals a major shift in delivery preferences.

The trend is especially strong among younger shoppers. 66% of Gen Z and 54% of Millennials reported using a locker in the last 12 months, showing that for these demographics, OOH delivery is now an expected part of the online shopping journey.

The growth potential doesn’t stop there. Around 20% of UK consumers who have never used a parcel locker say they are open to trying it. This points to a sizeable untapped market and makes it clear that OOH delivery will be a long-term fixture in the future of eCommerce logistics.

How OOH Delivery Works in Practice

Out-of-Home delivery typically follows two main models, each offering distinct advantages:

• Automated Parcel Lockers (APMs): These self-service units are often located in supermarkets, train stations, or petrol stations, giving customers 24/7 access. They’re ideal for people with busy or unpredictable schedules. The process is fully automated where customers receive a unique code to unlock their designated locker.​​​​​​​
• Staffed PUDO Points: Here, existing retail outlets such as corner shops, newsagents, or supermarkets serve as collection points. These fit naturally into customers’ daily routines and add a personal element, with staff available to help with collections and returns.

Optimisation for eCommerce

To fully capitalise on the benefits of OOH delivery, retailers need to optimise their checkout experience and integrate it into the online shopping journey in a way that is clear, intuitive, and convenient.

• Checkout Integration: Allowing customers to select their preferred PUDO point or locker directly at checkout, ideally through an interactive map, makes the process simple and user-friendly. Visual selection helps customers identify the most convenient locations quickly.​​​​​​​
• Network Selection: Partnering with a network that has high coverage in key customer areas is essential. Locations along popular commuting routes or near residential areas add significant value. A broad, strategically placed network ensures customers always have an accessible option nearby.

Conclusion

Out-of-Home delivery is reshaping the last mile by addressing challenges that have long frustrated both businesses and customers. From reducing failed deliveries and lowering operational costs to improving convenience, security, and sustainability, the benefits are clear.

The data shows adoption is accelerating, particularly among younger shoppers, with parcel lockers and PUDO points quickly becoming a standard expectation in online retail.

In short, OOH delivery is no longer an alternative, it’s a core part of modern eCommerce logistics and a crucial step towards a more customer-focused and sustainable future.