The smart locker industry is about to undergo a similar growth surge to the one we’re currently experiencing in South Africa.
By Herman Meyer, technical director of Ricoh South Africa
Much of this is a result of the change in work and buying patterns as a result of the global pandemic and its extended lockdowns, but it’s also in part due to large investments in intelligent logistics technology for the smart locker industry by companies such as Ricoh.
Unlocking the benefits
According to FNB Merchant Services statistics published earlier this year, South Africa’s e-commerce market is projected to hit R400 billion by 2025, a significantly higher number than pre-pandemic projections. The same report pegs the current size of the market at just under R200 billion, up from only R14 billion in 2018 according to WorldWideWorx statistics.
Given the exponential growth in their business, online retailers and other institutions like courier companies, postal services and banks, are facing increasingly complex logistical challenges when it comes to containing the costs, improving efficiencies and reducing the carbon footprint of first and last mile deliveries. It makes sense that they’re looking at – if not already implementing – several solutions to help them overcome these challenges, including smart lockers.
The idea behind traditional location-based smart lockers is a simple one: a delivery company collects a parcel from an e-tailer, business or individual, and delivers it to a locker location in close proximity to the recipient. Once the driver deposits the package, the recipient receives an SMS notification or e-mail on their smart device alerting them that the package is ready for collection, along with a unique code to authenticate themselves at the locker location. They can then collect their parcel from the pre-designated locker in their own time, during the day or late at night, as it suits them.
Smart lockers were already becoming popular pre-pandemic, with large logistics companies like DSV deploying locker arrays – complete with Ricoh’s Microsoft Azure cloud-based software and logistics technology – in various locations around the world, including South Africa. By the end of the year, DSV expects to have deployed more than 500 locker arrays across South Africa, while the numbers in Europe already run into the tens of thousands.
The advantages of smart lockers are manifold. More than 50 per cent of courier delivery costs come from last-mile driver delivery to individual premises, so courier companies are already using smart lockers not only to mitigate these costs, but also to help them achieve carbon emission compliance targets through the significant reduction in last-mile vehicle mileage.
Likewise, financial institutions like banks are using smart lockers to offer their customers a more convenient and secure way of collecting bank cards and other sensitive documents. Nedbank, for example, first introduced smart lockers in some of their branches in 2019, delivering more than 92,000 card parcels via its locker service between January and May this year alone.
Smart lockers evolved
While the idea behind smart lockers is a simple one, it’s the complex technology behind it that’s broadening the use case of smart lockers beyond these now established applications.
A locker solution doesn’t work in isolation; it requires a sophisticated back-end software infrastructure that can easily tie in to logistics, transport management, time management, authentication and other e-business systems seamlessly in order for the companies using it to have full control of their locker deployment.
This is where a solution partner like Ricoh comes in, providing all the necessary APIs, implementation skills, and a global network of service engineers to blueprint, manufacture, deploy and manage a sustainable and profitable smart locker solution across a growing number of different verticals. In the coming months, we’re going to see smart locker technology expanding into warehouses, retail outlets, private institutions, residential complexes and recreational facilities like gyms, cinemas and sports grounds.
Day lockers and smart premises
Day lockers is one example of an evolving smart locker solution that will allow companies to offer their hybrid working from home and office-based workforce a convenient way of storing their valuables at the office whenever they need to use it.
Ricoh’s workspace solution, Ricoh Spaces, automates locker spaces for visiting executives and other temporary workplace visitors, for securely storing luggage and other personal items while traveling between different locations. Likewise, staff on a hybrid working from home schedule can automatically be assigned a secure locker space just for those times they’re in the workplace.
Warehousing and asset management
In warehouses, companies will use smart lockers to assign handheld scanners and other valuable assets to shift workers, equipping lockers with chargers that ensure scanners and other electronic devices can be charged for the next user, while maintaining a secure register of who used which device when.
The rollout of PPE and other on-premises assets can also be better managed with a secure and auditable smart locker system, allowing only those personnel that need the equipment to access and use it, and also return it when their shift is done.
Retail and other advanced locker solutions
In the not-too-distant future, grocery retailers will use refrigerated lockers to offer their customers a convenient pickup location for perishable goods.
Likewise, e-tailers will be able to use smart lockers for reverse logistics, greatly simplifying the process of returning goods under warranty, for repair or for exchange, and offering their customers a more convenient way to return their good without having to rely on driver pick-up schedules and the like.