Technology for social good – Reducing the environmental impact of parcel delivery at Parcelly

SUMMARY:

Start-up Parcelly explains how environmental goals have been embedded into its ‘click-and-collect’ parcel delivery-based business model from the outset.

Parcelly, which was only launched in December 2014, recently received an accolade at Business in the Community’s Responsible Business Awards 2017 ceremony for its novel approach to cutting the substantial carbon footprint involved in dropping off customers’ parcels across the UK.

To explain, the company, which won the ‘Fujitsu Award for Responsible Business in the Digital Age’, has so far set up a network of about 1,200 organisations across the nation, including newsagents, convenience stores, gyms and dry cleaners, which have redundant space to store parcels and appreciate the increased footfall.

These outlets agree to act as ‘click-and-collect’ sites for customers, who in turn download Parcelly’s app onto their mobile phones and use it to select the location they would like their goods delivered to or returned from. Consumers have the option to either pay on a per parcel basis or to take out a monthly subscription for the convenience of no longer being bound to prescribed locations dictated by online retailers, usually their own stores.

Online retailers or logistics providers using the firm’s service are also charged per transaction, of which participating Parcelly outlets receive a percentage. Sebastian Steinhauser, the company’s founder and managing director, explains that, although the organisation initially started with a business-to-consumer focus, it has now branched out into business-to-business partnerships too:

We’re helping online retailers and e-commerce platforms that want to offer click-and-collect and use a carrier-agnostic solution in the process. But we’re also collaborating with carriers so they can use us if they don’t have their own click-and-collect network or if they want an alternative after the first attempt at delivery has failed. So they can leave the parcel with us, we’ll connect with the customer and also inform them that they have seven days to collect it from a nearby location of their choice.

Environmental impact

But the ultimate goal, says Steinhauser, is to have a “massive environmental impact”. He estimates that by January 2018 when the company’s network of participating outlets is expected to have grown to between 2,500 and 3,000, Parcelly’s approach should result in the number of delivery vans on the road being cut by 21.9%, slashing carbon emissions, air pollution and congestion in the process.

It should also lead to the distribution of 4.6 times more parcels and a reduction in total labour costs by nearly a fifth. The idea is that, while traditional delivery methods enable one parcel to be dropped off every three and a half minutes, Parcelly’s will mean that 50 parcels are delivered in just 13 minutes. A further aim, meanwhile, is to slash the current annual delivery failure rate of 10% out of 1.6 billion parcels to zero. Steinhauser says:

The green thing wasn’t just a nice accident. It was embedded into our business model from the outset. Before we set up the business, we were doing research on environmental impacts and we decided from the start to partner with companies that could help reduce the carbon footprint of each parcel.

As a result, the company signed up Berlin-based Atmosfair, which receives 5% of each booking fee and offsets CO2 by investing the money into developing renewable energy projects in Africa and South America.

Another more recent beneficiary of the firm’s philanthropy is Barnado’s, a charity that looks after vulnerable children and young people. In June, it undertook a ‘click-and-donate’ pilot project with Parcelly at 100 locations in the cities of Birmingham, Nottingham and Manchester. The initiative, which will be rolled out across all of the NGO’s 700 sites by the end of the year, will result in a percentage of each transaction cost being donated to the charity’s Trust. As Steinhauser points out:

There’s a social responsibility element to everything we do. It’s something built into the model so even if we decided we didn’t want to support active projects in future for whatever reason, we’d always have a positive impact.

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