5 Million Mark: A Measure of Skyrocketing Ecommerce Industry

In some ways, 5 million represents the perfect storm.

While package delivery continues to increase exponentially in the ecommerce market, Package Concierge® has tirelessly aimed to keep a steady pace by installing innovative package lockers in as many locales as possible.

In Spring 2016, we surpassed the 2-million mark in package transactions. At the time, it signified a hefty achievement. But as consumers continue to gravitate to online shopping and nationwide demand for package solutions rises accordingly, we’ve experienced more than a 200-percent spike in package lockers installations.

With that, the number of package transactions has quickly ascended to 5 million.

5 million

To be clear, the 5 million figure isn’t something we’re thumping our chest about. In our eyes, the number more represents the thriving ecommerce industry and the suddenness of it. This hasn’t been a gradual rise – it has been meteoric. There is a reason why businesses are closing brick-and-mortar stores but continue to thrive overall. It’s because their merchandise is being ordered through a few clicks online, and consumers are utilizing package delivery at ultra-historic rates.

Ecommerce Increase Means More Deliveries

Internet sales accounted for a mere 3 percent of consumer expenditure as a whole in 2006. That number rose to 15.5 in 2016 according to Business 2 Community, and the U.S. is at the forefront of this global movement. Ecommerce is a $220 billion market in the U.S. and has grown at annual rate of 17 percent over the past decade.  This figure is likely to increase even more with Walmart’s recent announcement that is it offering free two-day shipping.

The trend within the trend is that consumers are not only shopping online, but increasingly doing so through mobile devices. Experts predict that mobile transactions (those conducted through smartphones and tablets) will account for 26 percent of retail ecommerce sales in the U.S. by the end of 2017.  This figure is likely to increase even more with Walmart’s recent announcement that it is offering free two-day shipping.

What to expect?

Packages are being delivered at such a fervent pace that Amazon is unveiling its own delivery service. The Wall Street Journal reported in July that ecommerce growth played a key role in 3.2-percent profit growth for the United Parcel Service. Naturally, Amazon’s decision to utilize its own deliverers could put a dent in overall numbers for UPS, FedEx and USPS. But no matter the method in which they are shipped, the packages will continue to arrive.

Looking to the Future

Along with the demand, residents are expecting to receive their packages in a convenient, hassle-free manner. That’s why we believe it is important to parallel the growth of ecommerce with solutions that fit.

Perhaps in six months or a year, we’ll view our 5 million package transaction as obsolete, as antiquated as the dial-up modem. But for now, the figure holds some clout when looking at ecommerce as a whole.

5 million.

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Packages Everywhere! You need a plan.

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By Georgianna W. Oliver, CEO

Over the past few weeks there has been a lot of media focused on the question of whether properties should continue to accept package deliveries – a task that requires time, energy, and resources that could be spent more effectively in other areas of the business. Laura Kusisto, reporter for the Wall Street Journal, has analyzed the rise of online shopping and writes “U.S. online retail sales are expected to swell to $334 billion in 2015, up from $263 billion in 2013, according to Forrester Research Inc., a research and advisory firm. The increase is proving to be problematic with properties scrambling to figure out where exactly to safeguard these packages.” This is where Package Concierge comes in (as featured recently on the Today Show on NBC). I founded Package Concierge 3 years ago with the belief that we can help to solve the package management dilemma in multifamily housing.   Now, with installations across 24 states, a growing list of very satisfied customers, and a knowledge base about what works and what doesn’t across a range of property types, we are finding ourselves in the role of consultants on this issue. So, which Package Concierge solution would best meet your property’s needs based on your property type?

Garden Style Apartments – Should we even be accepting packages?

Are delivery carriers attempting delivery to the resident door? If so, a leasing office at a garden style property may reasonably refuse to accept packages. Camden Property Trust received a lot of press that made it sound like they were refusing all package deliveries at their communities — which is not the case. They are simply saying: let the delivery carriers do their job and we don’t want to be liable for those packages.

If you do accept deliveries at a garden style community, then use your lease addendum to define the weight and size of the packages you will handle. To track and store these packages, you may choose to purchase a Package Concierge.

Only purchase a size that you will need for non-delivered, overflow packages. Based on the fact that the average 200-unit property receives 30-40 packages a day, and only a limited percentage (non-delivered) should be received in the leasing office, approximately 54 lockers of varying size will meet this demand. Keep in mind that for garden style communities you will need an indoor or covered space for a Package Concierge.

Mid-Rise Buildings – What a great amenity!

Mid-rise communities offer some of the most attractive communities for city-dwellers, many with Starbucks cafes, theatre rooms, dog parks, and swimming pools. These communities still have to deal with the untidy issue of packages. Based on whether the community has exterior doors or security gates, property management may or may not allow delivery carriers to deliver to the units. If you do not allow carrier access, then you should consider offering Package Concierge as a value added amenity. Our system can be installed in all kinds of locations such as: vestibules, hallways, exterior breezeways, parking garages, gyms, cyber cafes, or in areas adjacent to another amenity in the community.

The most important things to keep in mind in mid-rise buildings:

  • Delivery carrier access – If is not accessible to the drivers, then you may receive pushback from individual carriers. While we can help to solve that problem, we strongly recommend making access easy.
  • Resident convenience – When a package locker is located in a convenient location, residents will stop by on their way home from work/school.

For a 200-unit mid-rise building we would typically recommend our standard 66- locker system (which requires just over 13 lineal feet of wall space).

High Rise Buildings – Do we have space?

Unless you are willing to hire a full time person to handle packages, high-rise buildings must have a solution to address the inflow of packages.

For security purposes, most high rise managers do not want delivery carriers roaming the halls to attempt resident delivery— especially now that Amazon is subcontracting to practically anyone to deliver packages. Packages are arriving to high-rise apartments in all types of vehicles with non-descript delivery carriers. Imagine Keith the bartender from the local pub whose side jobs include being an Uber driver and delivering packages for Amazon!

Many urban buildings are seeing an average of 60+ packages a day in 200 units, with packages often cluttering up common areas. So, high-rise buildings are great candidates for Package Concierge.

For high-rise communities, space constraints are often an issue in determining whether you can invest in Package Concierge. The number one question to ask before even talking to any locker provider is: Do we have space? For a 200-unit high-rise building, you will need a minimum of 13 lineal feet to make a dent in the package load.  The good news is that Package Concierge is modular and we can install the system in an “L” or “U” configuration if necessary.   And for high-rise properties, dry cleaning and oversize lockers are a great add-on.

Based on all of our client feedback, Package Concierge is offering a value added solution that is helping properties to address the package management dilemma. Ultimately, you have to be thoughtful regarding what will actually work for your community. Contact us for statistics, recommendations, and space requirements as you consider investing in this exciting new amenity!

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Holiday Package Preparation

christmasYes, it isn’t even Halloween yet. And yes, you should be thinking about the upcoming holiday season. Especially if you plan to ship gifts to your loved ones across the country or across the world. Given the way the calendar falls this year, the holiday season is compressed by one week. You can thank a late Thanksgiving and early Hanukah for that (Did you know they’re on the same day this year?). With one less weekend to shop for deals, that’s one less weekend to prepare your gift packages.

Don’t think it’s a big deal? Well, some of the biggest names in shipping sure do. Amazon plans to hire 70,000 season workers to handle the increased load this year.  That’s up 20,000 from 2012.

Fedex expects an 11% rise in Cyber Monday sales, thanks to the increase in online shopping, making December 2nd their anticipated busiest day of the year with 22 million packages shipped.

UPS also knows that because of the compressed holiday season, that they will be busier than ever. December 16th, UPS’s peak pick-up day will likely see 34 million packages and they’re hiring additional works to handle the load.

If you want to get ahead of the curve, what should you do?

Shop Early. Instead of waiting for December to roll around, head out to the stores now and get your shopping done to beat the rush.

Ship Early. If you’re packing a gift yourself, or buying on the web, it would be best to do it early. The sooner you get your presents out, the shorter the lines and the shorter the wait.

If you’re like most people and wait until the last minute, what should you do?

cyber mondayCyber Monday Deals. Given the short shopping season, the online deals on Cyber Monday (December 2nd) will be worth the wait.

Last Minute Deals. Some companies offer last minute deals if you purchase much closer to Christmas (December 20th or later) such as 75% off the full price you might pay in November.

Whichever route you take, this holiday season is sure to be one of the busiest yet.

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