What is PUDO (Pick-Up, Drop-Off) and How Does it Work?

It’s time to add another acronym to your ever-growing retail vocabulary: PUDO Pick Up Drop Off. Joining the likes of BOPIS (Buy Online, Pick-Up In-Store) and BOPIL® (Buy Online, Pick-up in Locker), PUDO is another parcel delivery option that creates convenience for both retailers and consumers. In this blog, we’ll explore what it is and more importantly, how it works.

PUDO vs. Traditional Home Delivery: What’s the Difference?

While traditional home delivery remains the default option for many, PUDO offers a compelling alternative that can improve cost-efficiency and consumer satisfaction. The main difference lies in how the parcel reaches the customer. With PUDO, the package is delivered to a designated pick-up point—such as a parcel locker or retail store—rather than directly to the customer’s doorstep.

This approach reduces the number of failed delivery attempts, streamlines logistics for carriers, and allows customers to collect their parcels at a time that suits them. It also lowers last-mile delivery costs and contributes to a more sustainable delivery model by consolidating drop-offs into fewer locations.

PUDO Defined

In its most simple terms, a PUDO point location is any area where consumers can pick up items or drop off returns, whether staffed or not. In reality, the term is most often used for smart lockers located in densely populated areas that are accessible to any consumer.

This distinction of lockers being open to all is significant, as most smart lockers are installed and owned by one party (such as a courier or a retailer). For example, retailers such as Lowe’s employ Parcel Pending by Quadient locker solutions, but only their shoppers have the convenience of retrieving or returning items with the lockers. A community-wide parcel locker network, on the other hand, is completely agnostic: accessible to any retailer, carrier, or consumer and often placed on public property (such as a parking lot or public transit hub) or within local stores.

The Benefits of PUDO

There are myriad benefits specific to each target audience using these PUDO locker hubs. Retailers who install PUDO smart lockers within their stores report increased foot traffic and, more importantly, can see as much as 70% of customers go on to make incremental purchases.¹ Online retailers (or e-tailers) can earn customer loyalty by offering a delivery option everyone prefers and embracing the concept of personalised logistics. Carriers recognize that a centralised PUDO location can boost efficiency while lowering noise pollution, air pollution, and greenhouse gas emissions. Customers easily collect deliveries, use parcel drop off services or return items at any time, with the peace of mind that comes from knowing their packages are safe and secure.

In 2015, PUDO CEO Frank Coccia founded his company based on the benefits of a courier-agnostic system. “PUDO puts the consumer in control of their parcel, where and when they want it,” he said while describing his service. “There are no missed deliveries due to the consumer not being home or even worse, the individual is home and did not hear the knock or doorbell or simply did not get out of the shower on time.”

How the PUDO Process Works: Step by Step

The PUDO journey begins when a customer places an order online and selects a nearby pick-up location during checkout. Once the order is fulfilled, the parcel is delivered to that location. The customer is then notified—typically via email, SMS, or app—that their package is ready for collection.

At their convenience, the customer visits the PUDO point, authenticates with a unique pick-up code or ID, and collects their parcel. In the case of a parcel locker, the process is entirely self-service. For staffed locations, the handoff is supported by a retail associate.

This process reduces delivery friction, especially for consumers who can’t be home during standard delivery windows.

How Smart Lockers Work

After consumers complete a purchase with an online retailer and select a PUDO point, they regularly receive insight on their item’s expected delivery date. Once their packages are safely and securely placed in a locker, the customer receives a text or email alerting them of the delivery along with a PIN or barcode to effortlessly open the indoor parcel locker or outdoor locker with zero human interaction. It typically takes less than 10 seconds to open a locker. Lockers also support contact-free returns, a process that takes less than two minutes for a customer to complete.

The initial research into retailers using smart lockers for contactless PUDO services is overwhelmingly positive. A Fortune 500 retailer who installed Parcel Pending’s smart locker solutions noted that 95.9% of customers said using the locker saved them time in picking up their order; 94.3% of customers said they are likely to use in-store pick-up with lockers again and 93.4% of customers rated their experience as “very satisfied.”

Parcel Locker Networks are Growing Globally

As the world recognises both climate change and the explosive growth in online shopping, the demand for parcel locker hubs is booming. Quadient recently reached an agreement with DHL, the world’s leading logistics company, to roll out a significant number of smart parcel lockers to outdoor locations in the largest regions of Sweden. As Managing Director of DHL E-Commerce Solutions, Jonas Lindell, explains: “The partnership with Quadient is completely in line with DHL’s strategy, offering greater flexibility for both customers and e-retailers. With a wider range of pick up and drop off lockers, we get closer to our customers and can in a simpler way be proactive in building up our delivery network.” DHL has created over 10,000 PUDO points across its home turf of Germany.²

Purolator, a leading freight, package, and logistics provider, also installed Parcel Pending by Quadient smart lockers in its busiest terminals to add convenience and flexibility for customers. During the busy 2021 holiday season, the smart lockers supported Purolator customers by harbouring more than 12,000 shipments.

Industries That Benefit from PUDO

Although PUDO is most commonly associated with e-commerce, its benefits extend to several other industries. Retailers offering apparel and electronics often use PUDO to streamline both deliveries and returns. 

The healthcare industry is also adopting PUDO solutions to enable secure, contactless pickup of prescription medications. Logistics companies and 3PLs benefit from improved delivery efficiency and route density. Any business looking to reduce costs, increase customer convenience, and cut emissions stands to gain from adopting a PUDO model.

Considerations in Creating a PUDO Point

Artur Kikuła who was a major player behind installing 7000 access points in Poland highlights that building and implementing a high-functioning drop-off point requires skilful planning, appropriate hardware and software analysis, optimal PUDO location analysis, and systems integration. “The hardest part is building enough stable access points to give proximity (within 12 minutes or 1km [0.6 miles] walk for the consignee) and the appropriate conditions for access to the point, such as customer car parking.”

How Retailers and Carriers Can Implement PUDO

Adopting a PUDO model begins with selecting a reliable solution provider. Many retailers and carriers work with third-party providers to access an established network of parcel lockers or staffed locations. From there, integrating PUDO options into the online checkout process helps customers choose the most convenient pick-up location.

Retailers may also need to align internal processes—such as inventory handling and return workflows—with their PUDO strategy. The goal is to create a seamless experience that’s easy for both staff and customers to navigate.

Implementation can be phased, starting with high-traffic areas or pilot programs, and then expanded based on demand and performance.

The skyrocketing demand for PUDO services is a perfect storm of consumer interest in convenience and personalised logistics, ongoing concern about Coronavirus mutations, increased costs of fuel for individual home delivery, and the need for a streamlined courier delivery process flow and efficient parcel returns.

What the PUDO Experience Looks Like for Consumers

For end users, PUDO offers greater control over when and where they collect their packages. Instead of waiting at home for a delivery window, they can choose a pick-up point that fits into their daily routine—whether it’s a parcel locker near their office or a participating store close to home.

Once the parcel is ready to collect, they receive a notification and can pick-up at their convenience. This model supports modern shopping habits, reduces delivery-related stress, and often results in faster overall fulfillment, especially for shoppers in busy urban areas.

Parcel Pending by Quadient’s smart locker solutions can help you solve these issues while also driving incremental sales. Interested in learning more? To speak to a Parcel Pending representative, contact us today.

Sources:

1. Morgan, Ethan. “What is PUDO and What Does it Mean for Retailers, Shoppers, and Carriers?”. Doddle, November 14, 2019. https://www.doddle.com/us/blog/pudo/what-is-pudo-and-what-does-it-mean-for-retailers-shoppers-and-carriers/
2. Kikuła, Artur & Różycki, Marek. “PUDO networks: a how-to guide”. Parcel and Postal Technology International, June 24, 2019. https://www.parcelandpostaltechnologyinternational.com/analysis/pudo-networks-a-how-to-guide.html