Amazon Will Now Allow Returns Using Lockers

April 16, 2014 Leave a comment

Amazon Will Now Allow Returns Using Lockers

GREG BENSINGER

Amazon.com has quietly rolled out a new service to let customers return unwanted merchandise using large metal lockers it has installed for deliveries in garages, convenience and grocery stores in major metropolitan areas.

The service will help address a problem that has plagued Amazon and other e-commerce retailers. As much as a third of all online purchases are eventually returned, by some estimates, making it costly for merchants that in some cases pay for shipping in both directions.

Packaging and shipping orders is a major expense for Amazon. The company has been on a warehouse building frenzy in recent years, constructing facilities close to urban centers to speed delivery times. Amazon spent $8.59 billion on order fulfillment in 2013, up from $6.42 billion a year earlier.

Amazon has been installing the lockers in public places over the past several years, giving urban dwellers a way to ensure their packages can be delivered even when they are at work. Amazon puts the packages in one of a few cabinets in a locker and sends the customer a code to open it, usually giving them two or three days to do so.

Similarly, for returns Amazon sends a code to open a specific cabinet in a locker where customers can leave their merchandise for UPS or other carriers to retrieve. The service presumably will save Amazon some costs because the carriers will already be visiting locker sites for drop-offs.

Nonetheless, Amazon appears to be charging the same rate for returns through lockers as for drop-offs at UPS sites. Consumers have one business day to drop off their packages, which must be no larger than one cubic foot to fit in a locker, according to Amazon’s website.

“Customers like the added convenience” of returns through the lockers, said an Amazon spokeswoman.

While Amazon has been expanding its locker program, rival Google is scaling its own back. After acquiring BufferBox, a Canadian company with similar lockers, in late 2012, Google earlier this year announced that it would shut down the service.

 

Filed under TMT Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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