Analyzing the Costs and Benefits of Installing Unmanned Parcel Lockers: Focusing on Residential Complexes in Korea

Abstract

A boom in e-commerce in Korea has sparked off high daily-volume demand for small-sized home delivery services, which poses a great challenge to distribution networks, especially in urban areas where traffic congestion, accessibility, and pollution are serious problems. In addition, security issues for people who live in small townhouses and detached houses without security systems and guards have received increasing attention from the government and society. Thus, the introduction of a new alternative for home delivery services, unmanned parcel lockers, is urgent for residents living in these areas. This paper examines and compares potential socio-economic impacts in terms of costs and benefits when such lockers are installed at selected locations in residential areas. The results show that this policy is worthy of adoption, with several undeniable benefits to local communities. In addition, sensitivity analyses estimate the economic performance of this project at different social discount rates, and they check the sensitivity of economic performance based on variations in the variables. The value of travel time savings was identified as a critical and dominating factor directly affecting economic performance.

Citation

Pham, H.T. and Lee, H. (2019), "Analyzing the Costs and Benefits of Installing Unmanned Parcel Lockers: Focusing on Residential Complexes in Korea", Journal of International Logistics and Trade, Vol. 17 No. 2, pp. 43-54. https://doi.org/10.24006/jilt.2019.17.2.002