Delivery lockers are everywhere. But there’s a battle brewing

For some, the solution is simple: postal lockers. For the uninitiated, postal lockers are safety deposit boxes ranging from about three inches by 12 to a foot-and-a-half squared. The biggest of them can hold parcels weighing more than 2st.

Thousands are springing up across the country at service stations, supermarkets, railway stations and even pubs. Armed with a QR or alphanumeric code, you can collect items otherwise destined for the doorstep; or drop off outgoing mail or shopping returns.

They are particularly popular with younger consumers: 71 per cent of Gen Z shoppers have used a postal locker, compared with 35 per cent of baby boomers, according to Retail Economics.

Now, by a quirk of fate, Britain’s burgeoning lockers market is now being fought over by two billionaire Czech dynasties.

The largest operator in the UK is InPost, a Polish company with a stock market value of €8.4 billion (37 billion), whose largest shareholder is the family of the late Petr Kellner. InPost has 8,000 lockers in Britain and reckons there is a demand for more than 30,000.

Kellner, once the Czech Republic’s richest person, had amassed a fortune of $17.5 billion before his death in a heli-skiing accident in March 2021. He was behind the Prvni Privatizacni Fond (PPF), or First Privatisation Fund, which capitalised on the liberalisation of the economy after the Velvet Revolution in 1989.

The Kellner family’s €2.5 billion stake in InPost pits it against a Czech investor who is far better known in the UK.

Daniel Kretinsky, nicknamed the “Czech sphinx” for his inscrutable investment style, made a series of shrewd bets on coal and gas assets in the 2010s. He hit the headlines in the UK this year for a £3.6 billion takeover bid for International Distribution Services (IDS), the parent company of Royal Mail. He also owns a slew of old British Gas assets, 10 per cent of Sainsbury’s and 27 per cent of West Ham United, the Premier League football club.

Like those managing the Kellner family fortune, Kretinsky is convinced that Royal Mail’s fortunes can be turned around by investing heavily in postal lockers. He has set aside £400 million to roll out 20,000 Royal Mail lockers, if his takeover completes regulatory hurdles.

Meanwhile, he is hedging his bets. Kretinsky is also the biggest shareholder in the French postal locker company Quadient, which has recently won contracts to install lockers across 1,261 pubs owned by Punch Taverns and across dozens of stations served by Northern Rail.

Daniel Kretinsky hit the headlines with a £3.6 billion takeover bid for the parent company of Royal Mail

CHRISTOPHER L PROCTOR FOR THE SUNDAY TIMES

So why are the Czechs going to war over our postal lockers?

With internet sales increasing from 3.4 per cent of total retail sales in 2007 to almost 30 per cent last year, according to the Office for National Statistics, ever-more parcels are stacking up on doorsteps. And with eight million people living in flats and apartments in London, Birmingham and Manchester, the signs are that Britain is ripe for a postal locker revolution.

However, addressing security concerns only works if consumers do not have to go out of their way to access them.

This is why scale is so important, Michael Rouse, chief executive international at InPost, said. To achieve this, he reckons that InPost must have one bank of postal lockers within seven minutes’ walk (in cities) or within seven minutes’ drive (in rural areas) of every household.

A byproduct of delivering parcels in bulk to lockers in a single location instead of to dozens of individual addresses is that it is cheaper, not to mention better for the environment by virtue of fewer postal vans on the road.

Savings can be passed on to consumers by lowering delivery charges. At the moment, the benefits are not substantial. Royal Mail second-class parcels start at £3.69 compared with £3.42 for InPost. First-class parcels start at £4.59.

“I want it to be 30 per cent cheaper than delivering to the door,” Rouse said.

Michael Rouse, chief executive international at InPost, says it has “first-mover advantage”

ANDREW PORTER/INPOST

Lockers are not just about incoming mail. Second-hand clothing companies such as Vinted have soared in popularity in recent years; with them comes a need for consumers to post parcels regularly. Many people prefer popping goods in a locker rather than waiting for them to be collected from home, or having the hassle of queueing up and dropping them at the Post Office or a corner shop.

The profits seem to speak for themselves. Despite being in the middle of an aggressive rollout, InPost recently flipped from lossmaking to turning a profit in the UK. “Now we are seeing the proof in the business model,” Rouse said.

The prospective challenge from Kretinsky and Royal Mail looms. “But we’ve got the first-mover advantage,” Rouse explained. “We have long-term agreements with Tesco, Sainsbury’s, Morrisons, Lidl and Aldi. The only retailer we don’t really have an agreement with is Asda.”

Others will begin catching up, however. Rouse points out that for the likes of Royal Mail or Amazon, lockers are a nil-sum game. For every person who switches from home delivery to postal lockers, Royal Mail and Amazon are no better off because they are customers who previously used their home delivery service.

Having realised this, Amazon has elected to pare back its lockers in the UK for fear that it might mean people are less likely to pay the £8.99 a month that entitles Prime members to home delivery at no extra charge.

“I’m not eating my own profit pool,” Rouse summarised. “I’m eating theirs.”

As Britain’s postal locker war hots up, Tregoning is coming around to using them.

“Parcel lockers are definitely better in my experience than dropping off at a shop,” he said. “Failing that, the only thing I can recommend is to have excellent neighbours.”