Smiths News has announced the launch of Pass My Parcel – a click and collect service which will allow online shoppers to pick up goods from local shops.
Uniquely, it will allow customers to have products delivered to their local news or convenience retailer within a few hours of ordering from Amazon.
Retailers will get 45p and a boost to their footfall as customers comes through the door for parcels.
It has launched initially with 550 stores, but there are plans to create a national network and widen the client base.
RN had the opportunity to put questions to Smiths managing director Jon Bunting and commercial director Louise Ryan.
Retail Newsagent Why has Smiths chosen to launch Pass My Parcel?
Jon Bunting As a wholesaler, the market is in decline. We are all looking for complimentary profit streams. We want to work with independents to create a thriving retail base. That’s why we have worked with Amazon to launch a business called Pass My Parcel. That will see us create between now and Christmas, 550 parcel shops. All will be independents and we will be distributing, on behalf of Amazon, parcels for consumers. The bit which is ground breaking is how we are going to do it.
RN How will the service operate?
Louise Ryan When we were looking at this we were very keen to work with independents. Their sustainability is very important and it allows us to share some of the costs of the news and magazine supply chain. Initially we were looking at taking parcels out with news and magazines. In fact, we will do it in two waves. There will be distribution first thing in the morning with news and magazines. Consumers can order up to 9pm and we will be in store by 6am the following morning, depending on when that store is open. That will be unique in the parcel collection market. There will also be 2pm pickups from our depots to go to parcel shops. That will allow the consumer to order in the morning and pick up in the afternoon, offering a same day collection service. We will create a level of scale that doesn’t exist in same day parcel services.
JB We’ve got 550 retailers trained up and have explained the scanners to them. Each parcel will be scanned off the van by the driver and we will ask the retailers to check that they have dropped the right number of parcels. As soon as it is scanned, the system will be updated and Amazon can tell the customer that it is ready for collection. We don’t want to retailer to have to book the parcel in. We have recognised that if the parcel needs to be booked in and you drop it in the store when it’s busy, it can be four or five hours before it’s booked in.
LR We have tried to take that task away from the retailer. A lot of parcel services have requirements for more onerous checks on ID. Pass My Parcel won’t require you to show ID. We have run some trials in the last few weeks and retailers like simplicity of it.
RN What stage is the service at and how will the service develop?
LR Pass My Parcel is Smiths News’ company and Amazon is our client. The service will be live next week. Retailers in five areas have had training and a test parcel – Reading, Slough, Oxford, Milton Keynes and Northampton. Seven others will go live during October – Birmingham, Wednesbury, Stoke, Stockport, Warrington, Bolton and Shrewsbury.
JB The pre-Christmas service will be outbound only.
RN How have the retailers been selected?
LR We are launching with 550 retailers. They have been selected in conjunction with Amazon. The locations are representative of about 20% of Amazon volume. We’ve got retailers in the background when more volume flows through. Each of the stores has been approached individually by our field team. We have looked for retailers who offer things like home news delivery and have good relationships with their customers. They are retailers who are important to us in the context of news and magazines.
RN What has been the response from retailers?
JB We’ve been pleased with the response. Retailers recognise the need to offer more services. This is a market in massive growth and we are offering something different. We will develop a national solution. That might mean partnering with other companies but it is very much our intention. The bigger challenger on footprint is growing the network of shops. We have to grow the retail base before we look at other clients and make sure it’s working brilliantly for consumers. Amazon is our first, but it won’t be our only client. It does already use MyHermes and Collect+ shops but the thing that is different here is the speed.
It has required a significant six sum investment. We own very few of our own vehicles but we have good relationships with contractors who will be working full days for us
Logistically, news distribution comes first for us. The parcels can be done on the reverse run if necessary.
We are not going to jeopardise the core business of news and magazines. If the volumes get spiky before Christmas, we will not hesitate to put on dedicated runs.
RN What are the insurance and liability implications for retailers?
LR Retailers will need to have cover for their shops but nothing which goes beyond current requirements. There are some contractual clauses about attributable loss, but it’s fair to say that won’t charge them for loss of a single parcel. We’re not saying that if you lose a parcel, we will turn your terminal off straight away.
JB We have tried to make this as easy as possible for the retailer. All the investment sits with us in the same way as it does with Jack’s Beans.
RN What support will there be for retailers?
LR We will have a central support team available between 6am and 9pm. If there are any problems with equipment, there’s a manual workaround. We don’t want to cause problems for the retailer or for the consumer to be unhappy.
RN How important are store and service standards?
JB Store standards are important to a degree but it’s as much about the attitude of the owner and the staff. It’s fair to say that if a consumer is prepared to shop there, they would certainly be happy to go in and collect a parcel. Retailers value the training we have given them. It’s not just about the technology. We need to make sure the service aspect meets the technical side.
LR Amazon has an aspiration to be the most customer centric business in the world. That’s their words. We will offer service levels to match that. They love the idea that they will be working with neighbourhood stores and people who serve their communities.
RN How do you hope other retailers will react to the launch of the service?
JB I want people to see this and say ‘that sounds fantastic. How do I become part of it?’ Smiths News is doing some stuff to help us’. I recognise that the relationship between ourselves and retailers is challenging at times.
LR I hope they see the client we are working with and know that we mean business.
RN Has Smiths News got a responsibility to provide new revenue streams to safeguard a route to marker for news and magazines?
LR Independent retailers are very important to us in the context of the future of our core business and its distribution.
JB It’s not a responsibility, but it’s our strategy. This could be the next big thing for our customers. We’ve done some consumer insight and the eyes of some of the panel lit up when we told them how quickly they could get their parcels. If the consumer wants a product at speed, they can get it.
RN How come the service won’t operate in London?
LR The footprint was set by the client. It already has some same day delivery solutions in London.