Smart lockers were a big topic at Last Mile Fulfillment Asia this year.

What are they you ask? They are the tech-world’s equivalent of high school cubbies but out on the street, in your condominium lobby or shopping mall accessible only to users with the right digital passcode.

smart lockers Southeast Asia

POPStation lockers in Singapore. Source: SingPost

Many e-locker providers such as PopBox in Indonesia, Box24 in Thailand and POPStation in Singapore talk about the future of their businesses as the best solution to the region’s ‘last mile’ problem. But is it that simple?

Let’s disassemble the smart locker.

How it works

As online retail grows in the region, it’s understandable that more packages need to be delivered to end consumers. Nomura International (Hong Kong) projects that the package delivery market for the six major Southeast Asian countries will more than double from 2015 levels to over $7.5 billion in 2020.

The last mile becomes costly for companies because of how geographically vast countries such as Indonesia and the Philippines are and the broken address system across Southeast Asia.

While the last mile of the supply chain may be the shortest physical stage in a package’s journey, it represents about 30% of total delivery costs.

“Delivery cost per package a few years ago used to be 60 THB and now, logistics companies in this red ocean are subsidizing costs to charge only 30 and even 20 THB to grab market share,” said Paul Srivorakul, aCommerce Group CEO, at LEAP by ecommerceIQ and Sasin SEC.

Enter the smart locker, a new delivery option that promises less failed deliveries, flexibility for customers, and cheaper last mile costs.

smart lockers Southeast Asia

Benefits of a locker-bank i.e. smart locker.

For couriers to deliver the package:

  1. Login with company’s credentials
  2. Access data and address customer’s information
  3. Choose an available compartment
  4. Scan the package
  5. Put the package in the compartment, lock it and confirm delivery

For recipients to pick up the package:

  1. Internet shopper selects the “parcel locker” while checking out online
  2. Shopper receives an email confirmation and SMS (or in app) with details and code on package pickup
  3. Customer can track shipment to know when package has been dropped off
  4. At the smart locker, customer provides the code and other details using the touch screen
  5. If a package is not picked up, it will be transported to the nearest branch of the logistics partner


In Indonesia, PopBox Asia allows customers not only to pick up packages but as well make payments and return packages. In Thailand, WashBox24 (now Box24), lets shoppers pick up groceries and washed laundry ordered in app through partnerships with supermarket Tesco Lotus.

In North America, 7-Eleven has opened its doors to partners like Amazon interested in renting lockers to stay relevant as commerce moves online.

smart lockers Southeast Asia

Source: WSJ

But lockers are risky for 7-Eleven as each locker takes up about the same amount of space as one large shelf, holding dozens of lockers, which by some estimates could represent thousands of dollars in lost sales each year.

Do they actually solve any problems?

In many ways, smart lockers sound like a perfect last-mile solution. Available 24-hours, simple to use, convenient for the consumer and cheap fee for ecommerce businesses as packages are consolidated at one drop-off point.

smart lockers Southeast Asia

SWOT analysis of e-lockers.

But do they work?

Based on recent app reviews for POPStation and Box24, the service and ‘seamless’ pick up experience have faced some problems.

smart lockers Southeast Asia

Source: Google PlayStore, POPStation (left), Box24 (right)

While understandable to have hiccups with the introduction of new technology, the hardware heavy system has proven to work well in markets like Europe. But in a unique market like Southeast Asia, there are a few factors unaddressed by most reports.

Apart from the fact that the lockers require prime real estate and are costly to build and maintain – $5,000 to $35,000 per piece – these machines don’t accept cash.

smart lockers Southeast Asia

Source: WashBox24

Given that majority of Southeast Asians, with the exception of Singaporeans, still prefer cash-on-delivery, this last mile option is not viable for many ecommerce companies whose customers want to see the item before committing to purchase.

smart lockers Southeast Asia

Source: aCommerce

In China, 15,000 lockers were put in place in 2014 but handled only roughly 1% of all deliveries.

As Lazada Vietnam Gerald Glauerdt commented LMFAsia 2017 to ecommerceIQ’s question if he believed lockers were a good solution for last mile, “these lockers are more expensive than couriers that can take the package directly to the door.”

Operating in low-labor markets such as Southeast Asia gives companies the luxury of re-thinking their last mile strategies. As logistics networks expand their networks in the region, such as hubs on Indonesia’s scattered islands, costs will decrease to reach customers in remote locations.

New startups such as Park N Parcel are also leveraging existing infrastructure such as mom and pop shops and convenience stores to offer another last mile solution.

With packages expected to increase in the region thanks to the rise of ecommerce percent of total retail sales, there is plenty to go around for logistics players, given they can handle today’s customer expectations.

“If you do last mile only, there’s zero loyalty. You don’t remember who delivered your order, but you remember who screwed it up,” – Vaibhav Dabhade, CEO and founder of Anchanto.

Mitch Bittermann, Regional Chief Logistics Officer at aCommerce recently sat down with The Postal Hub podcast to discuss a successful B2C ecommerce strategy, logistics in Southeast Asia, and what he thinks brands should prioritize when attempting cross-border. 

The Postal Hub: From a retailer perspective, what are the challenges to get into ecommerce

Mitch: I would look into tech, customer service, warehousing and transportation. Retailers today are mainly working from a B2B perspective. This means bulky shipping and heavy-duty racking in the warehouses, which is only suitable when operating B2B. To do B2C, the requirements are completely different, because the consignments are smaller. From a transaction perspective, businesses would also need to think differently.

With transportation, it would either be light or FTL (full truck load), the size of packages are smaller with B2C, which means you have to work with parcel couriers to get the items shipped to your end customer. The biggest difference is also with customer service. If a company is running their own customer service, it usually requires them to talk to businesses, but with B2C, customer service means the end customer is contacting you through various channels, from calling to live chat, things that B2B businesses may not have.

The Postal Hub: If you are a retailer entering ecommerce, what are the key delivery considerations?

Mitch: I would go one step before that. I would think about what the location strategy is. Where is your supplier, brand, manufacturer and customer sitting? If it comes from a transportation perspective, today, you’re shipping a lot on freight. You’re shipping pallets, costs is definitely a consideration but from a cost perspective it is a lot smaller than if you have to send everything in small consignments. Someone has to pick up the bill.

Customers in Southeast Asia are more cost sensitive about shipping price so retailers will eventually need to consider setting up a hub somewhere to cut costs on shipping.

Postal Hub: Cash on delivery is popular in Southeast Asia. What are the other ways people are paying?

Mitch: Cash-on-delivery (COD) is the biggest enabler in ASEAN. This is the choice for most people, especially in tier 2-3 cities that are unbanked. If you look at Indonesia, in a place like Papua New Guinea, 90% is COD. Do we have another method? Yes, but one of the challenges is that we do not have Alipay. Banks offer platform but they are not default.

In Indonesia, a lot of banks are talking about an e-platform but nothing concrete is happening just yet. 

For now, we cannot live without COD in Southeast Asia. Potentially, a retailer could lose out 60-70% of revenue if they don’t offer COD as a payment method.

Postal Hub: What about buy vs. build? What should be outsourced?

Mitch: It really depends on retailer maturity. If a retailer is just starting, I would say do as much as possible by yourself. Pack and send off shipment by yourself, if your business scales, then look to outsource. When it reaches the stage of 100,000 orders a month, do you want to run it by yourself or outsource to a third party service provider?

With transportation, it is best to outsource. This is because Southeast Asia still has fairly weak infrastructure. There are a lot of options to choose from; DHL and Kerry are the big ones. Then we have smaller disruptors such as Ninja Van and Sendit. All the movements in the transportation industry also mean prices will be soon drop and the industry will become more commoditized.

Some of my clients run their own warehouses and some outsource. When I was working in B2B, companies were running their own warehouses and then the outsourcing trend happened. The trend is coming for B2C, but I don’t think it will take 5-10 years to take off, it will go faster.

Soon, the trend will go towards out-sourcing supply chain so that businesses can focus on growing and selling their products. 

Postal Hub: What about cross-border delivery?

Mitch: With delivery, some people request next day or same day. It’s more difficult to ship cross-border with these requirements. Companies need to consider regulations that are related to ecommerce shipment and study revenue transfer, especially if you don’t have your own entity in that country. Figure out how to get money back from country A to country B while also thinking about tax implications.

Businesses will also need to think about FDA licenses and certain regulations. For certain products, you would need a license to legally bring it into a country, including distribution and logistics licenses.

A client came to me, they wanted to ship stuff from Singapore to Indonesia, but it was taking 7-9 days and costing customers $7 per shipping order. Depending on the product, that is quite a high price point. Customers are also not happy to wait that long for a delivery.

The client wanted a local set-up and do COD shipment because they want to build up scale. The company never shipped more than 100 orders a month. When they signed on with aCommerce, we closed 1400 orders after 3 months. The only thing that changed is the country we did the shipping from.  

For businesses that are starting out in Asia, I would say for them to start their operations from either Hong Kong or Singapore. If it scales, then is the time to go local i.e. Jakarta, or hyper-local, such as tier 2 and tier 3 cities like Bandung or Surabaya for better reach. 

Postal Hub: What about parcel lockers? What are end consumers in Southeast Asia interested in?

Mitch: The interest is there, but it’s all about reach and coverage. In Singapore, the country is not that big and essentially a metropolitan location, which makes it easier to offer things like same day delivery. In Bangkok, we power SKYBOX, a pick-up station on sky-train stations that allows consumers to pick-up their parcels on the way to and from work.

In Jakarta, MatahariMall offers lockers but it is limited in terms of coverage. I would recommend looking at pick-up and return from convenient stores such as 7-Eleven, Family Mart and Alpha Mart. There is already a lot of offline coverage in Southeast Asian cities and retailers can collaborate with these stores to begin a wider distribution network. 

Listen to the full interview on eIQ’s podcast channel here.

Here’s what you should know to wrap up the day.


1. Cross-border ecommerce and the Southeast Asian landscape

Thoughts on Southeast Asia: “There are huge variances in consumer preferences, there is massive fragmentation in the logistics network and infrastructure, and there are huge variances in the way people want to pay, and all of this creates huge complexity for anyone who wants to enter and see this as a unified market,” says Aimone Ripa di Meana, chief marketplace officer of Lazada Group.

Read the rest of the story here


2. DHL not worried about other logistics giants

Why not?: “I think what we do every night with millions of parcels is completely underestimated. You can call an Uber car, if it doesn’t show up you can call another one. If a parcel got stuck, what should the parcel do? It doesn’t speak, it doesn’t communicate. So some human intervention is necessary.” Says Frank Appel, CEO of DHL at the world economic forum in Davos, Switzerland.

Does this mean that drones won’t completely dominate the future of last mile?

Read the rest of the story here.


3. Singaporean crowdfunding firm CoAssets invests in China Da Xian Bing technology

The company stated that the investment, for 10% of Da Xian Bing, gives it access to a rapidly growing user base of more than 300,000 users who are familiar with the concept of crowdfunding.

The company will be able to leverage from China’s more mature P2P and crowdfunding market.

Read the rest of the story here.

Here’s what you should know.

1. Diamler invests in last mile robotics delivery startup

Auto maker Daimler AG has led a $17.2 million investment in London-based Starship Technologies. The company has presented a “Robovan” prototype, which would transport a batch of drones to a location where they can fan out to take packages the last mile of the delivery route. They can deliver up to three shopping bags worth of goods over a three-mile distance in about 30 minutes.

By being on the ground, it doesn’t face as many regulation guidelines as drones in the air.

Read the rest of the story here.

2. Singaporean online art platform, The Artling gets funding

The Artling announced that it has raised a series A worth US$1.75 million. The funding comes from Edipresse Media. The startup will use the funding to hire more people and focus more on marketing, two areas it held off on previously in order to control its spending. It will also be moving into a larger space as the team grows.

Read the rest of the story here.

3. China’s brick-and-mortar retailers likely to bottom out in 2017 

Positive signs emerged in December as sales for the top 50 retailers jumped 5.1% year on year, reversing a 5.6%  year-on-year decline in the same month in 2015. December also marked the biggest monthly increase in 2016.

“We believe 2017 is likely to be a year of stabilization for China and Hong Kong retailers, due to easier [comparable same-store sales] and lower pressure from operating expenses.” – Nomura analysts Emily Lee and Scott Hong.

Read the rest of the story here.

Chinese ecommerce giant, and Alibaba’s biggest rival,, announced it’s plan to approach drone deliveries, reports Tech in Asia.

The company has begun testing a new unmanned delivery drone that looks more like a small van than a quad-copter. According to JD, the drones are around a meter in length and have six differently sized compartments for carrying packages, making it potentially simpler to pack up and deliver to people’s homes.

How do drone deliveries work?

The bots can navigate intersections by recognizing light colors. When it arrives at their destination building, the customer inside will be notified via the JD app and they can come out, key in a code to unlock the cargo area, and collect their package.

The drones can select their own routes, drive themselves, and are equipped with smart obstacle avoidance technology.

JD states that these drones are the first of its kind to be developed in China, and the company aims to put them into large scale commercial use by next year.

According to JD’s representative, “the road testing with delivery cars is just the tip of the iceberg, the tests are just the first step.”

Apart from innovative delivery drones, JD is also working on a larger drone delivery car, but the company has not elaborated on details. Let’s wait to see how this folds out.

A version of this appeared in Tech in Asia on September 2. Read the full version here

Thailand Post plans to introduce four new services this year to support its move to a more digital postal organization, reports The Nation.

The four new services are:

    1. Prompt Post is designed to cut queuing time, is a pre-registration application in which people use a ready-to-send box before accessing post offices nationwide.It also has a pre-load application that allows customers to pre-register from their homes, automated post machines and automated deposit machines – the first one will be located at Suvarnabhumi airport.
    2. Messenger Post is an express delivery messenger and pick-up service for delivery nationwide. The service will allow postmen to collect products at home and at organizations.
    3. THP card is an e-money service applicabale for Thailand Post products and service fees.Thailand Post also plans to develop the THP card into an e-wallet for Thailand Post fee payments. It will also team up with Cambodia Post to provide a cross-border delivery service for Cambodian customers who make online purchases from Big C stores online.
    4. Cross-border delivery services

Satit Pittarat, Chairman of Thailand Post says “Thailand needs to adapt to the changing times by improving all its system, including services and investmen.t”

The enhancement would be developed under three key concepts, standardization, modernization and satisfaction to respond to the government’s “Thailand 4.0” initiative. Thailand Post has targeted revenue growth of 22.6% to 24 billion THB this year with a net profit of 3 billion THB.

Thailand Post also plans to renovate 1,300 of its counters by the end of this year.

A version of this appeared in The Nation on August 19. Read the full version here