Since the first parcel delivery lockers were invented in Austria in 2000, the number of lockers has grown steadily across the world.

Globally, the electronic parcel locker system market is worth almost $800 million, according to a report by Apex Insight.

Companies in North America, Europe, Australia, and China are using the delivery service for its convenience and parcel security, while carriers see it as a cost effective means to perform last mile delivery, which can account for up to 50% of all delivery costs.

One of the more recognizable names in North America for depot delivery service is Amazon. Since 2011, the service has grown from the initial cities of New York, Seattle, and London to more than 2,000 sites in more than 50 cities across North America and Europe.

In comparison, DHL in Germany, which initiated the move to locker delivery in Europe, has more than 340,000 lockers (Packstatons) and 10 million registered users since 2001. North America is slow in catching up to Europe and Asia in use of lockers because there is less incentive for businesses to host them here, the lockers fill up quicker than people pick-up, and they’re not promoted as alternative delivery modes.

The way the system works is during an online checkout a locker location is chosen for delivery. Once the package arrives at the locker, an email is sent to the buyer along with a barcode or access code to open the box where the package is located.

Amazon Locker keeps the packages for three days before shipping it back to the seller for a refund.

Amazon has also launched Amazon Hub, a parcel delivery service that can be delivered by any carrier from any business and anyone. Mainly used by apartment buildings, Hubs are currently servicing 500,000 residents across the U.S.

There are limitations to the lockers though. For example, Amazon Locker will only accept parcels if they are less than 20 lbs; have dimensions smaller than 19x12x14 inches; packages are only bought from Amazon; or are valued at less than $5,000.

Canadian locker manufacturer Snaile develops lockers that vary in size to accommodate small letter size parcels to large over-sized packages of up to two meters high and one meter wide. Snaile CEO Patrick Armstrong said the system enables retailers to do click and collect check out and carriers to do one delivery rather than returning multiple times to complete the delivery.

According to some reports, it costs on average $14,000 to build and install a parcel delivery locker. Armstrong said it can take about two to three months for one for his lockers to be delivered to a client.

While most lockers deliver packages some also receive packages for shipment, such as the United States Postal Service’s 27 Go Post stations. Parcel Post will offer a similar service sometime this year.

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