UPS enters the European B2C local collection points market

UPS announced on February 15, 2012 the takeover of Kiala, Europe’s leader of the “pickup points” market, for an undisclosed amount. Kiala has 7,000 pickup points in 6 countries (France, Benelux, Spain). Its revenue increased at 56% a year, from 1.3 M Eur in 2002 to 54 M Eur (estimated) in 2011. It greatly benefited from the growth of e-commerce (a 37.7 billion Eur market in France last year).

In the past 10 years, picking up e-commerce parcels at a local store has become an effective form of parcels delivery – in many European countries at least. It accounts for about 20-25% of all B2C e-tailing deliveries. As stated by Forrester Research in its France Online Retail Review 2012, “although home delivery is a commonly used option, Point Relais (local collection points) are popular. Retailers commonly establish distribution deals with a chosen chain of delivery points to give them national reach. Retailers that don’t offer a collection service risk being disadvantaged by those that do”.

Apart from Kiala, the largest pickup points chains in France are Mondial Relay (part of distance-selling giant 3SI) and Relais Colis (part of RedCats), each of them with more than 4,000 collection points throughout the country.

Kiala’s business model is based on the integration of the whole logistics/IT chain, from collection on the premises of 300 distance-selling chains to delivery at local stores . They have teamed up with major logistics partners such as Wincanton and Geodis, and chains of local retailers. Kiala also handles returns and cash-on-delivery payments.

Originally a Belgian start-up launched in 2001, Kiala had among its shareholders UK and US-based private equity funds, as well as Xange (an investment vehicle sponsored by La Poste Group, together with industrial partners like Neopost and financial institutions, whose goal is to finance innovative businesses related to postal activity).

(company site : kiala.com)