[Convenience Store Empire] Delivery? It Only Costs 1600 Won

④ Convenience Store to Convenience Store Parcel Service

Parcel Company Fees Rising One After Another... Available at Convenience Stores for 1600~2400 KRW
CU-to-CU Parcel 193%, GS25 Half-Price Parcel 150.7%↑
Utilizing Own Logistics System
MZ Generation Accounts for 70% of Users... Affordable and Low Risk of Loss

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[Asia Economy Reporter Lim Chun-han] Office worker Kim Ji-won (32, pseudonym) has recently been using convenience store parcel services frequently. As a single-person household, it is difficult to receive parcels directly, and there is no suitable parcel storage space in her studio apartment when she is absent. Above all, the low price is attractive. Kim said, “Once, a parcel left in front of the door disappeared, so I feel relieved about the reduced risk of loss,” adding, “Using parcel services often can be quite a burden on delivery fees. It’s convenient because it’s cheap and I can pick it up at the convenience store right in front of my home, which I have to pass by anyway on my way home from work.”

The parcel service between convenience stores has rapidly grown in a short period, changing the parcel delivery landscape. Especially as major parcel companies have raised delivery fees one after another since this year, the low price of convenience store parcel services is gaining more attention. Convenience store parcel services allow sending and receiving parcels directly at convenience stores, available at about half the price of regular parcel services, ranging from 1,600 to 2,400 won, making them very popular among consumers.

◆ How is the ‘low price’ that grows the convenience store parcel market possible?

According to CU on the 19th, from January 1 to August 15 this year, the number of ‘CU-to-CU parcels’ used increased by 193.7% compared to the same period last year. During the same period, GS25’s ‘half-price parcel’ usage increased by 150.7% compared to last year. CU-to-CU parcels close at noon on Saturdays, and only acceptance is possible on Sundays and holidays. GS25’s half-price parcel service is available 365 days a year without holidays.

Recently, parcel services between convenience stores have also replaced existing parcel demand. Especially during periods when regular parcel services are closed, parcel demand has concentrated on convenience stores. From August 13 to 15, when ‘No Parcel Day’ was implemented to guarantee rest for parcel workers, the number of CU-to-CU parcels used increased by 257.2% compared to last year’s ‘No Parcel Day’ (August 14?16). During the same period, GS25’s half-price parcel usage increased by 214.8%. CU-to-CU parcels also saw usage increase by 40 times and 11 times during last year’s Chuseok and this year’s Lunar New Year compared to the previous holidays, respectively. GS25’s half-price parcel usage during those periods also increased by 107.9% and 178.7%, respectively.

At CU, sending items weighing up to 500g costs 1,600 won. For items over 500g up to 1kg, it costs 1,800 won, and for items over 1kg up to 5kg, it costs 2,400 won. At GS25, parcels can be sent for 1,600 won up to 500g, 1,900 won up to 1kg, and 2,300 won up to 5kg. Convenience stores can maintain such low parcel prices thanks to their ‘own logistics system.’ Delivery drivers who deliver ready-to-eat meals like triangular kimbap and sandwiches collect parcels and bring them to logistics centers, after which drivers responsible for other regions deliver them to the respective convenience stores. This method significantly reduces costs. Utilizing the empty space in delivery vehicles incurs almost no additional cost, and delivery drivers receive a fixed commission per parcel.

◆ Low price with reduced risk of loss

Users of parcel services between convenience stores are mainly concentrated in the Seoul metropolitan area, including Seoul and Gyeonggi Province. According to last year’s CU-to-CU parcel usage by region, Seoul accounted for 31.6%, Gyeonggi 26.5%, Busan 9%, Incheon 5.8%, and Daegu 4.9%. Especially in Seoul, Songpa-gu (8.3%), Gangnam-gu (8.1%), Seocho-gu (6.0%), Gangseo-gu (5.2%), and Mapo and Gwanak-gu (4.9%) had higher usage than other areas. These areas share the commonality of having many people in their 20s and 30s and many single-person households. According to the Seoul Open Data Plaza, the districts with the highest population of people in their 20s and 30s are Gwanak-gu, Songpa-gu, Gangseo-gu, and Gangnam-gu, in that order.

Looking at the age groups of customers who used CU-to-CU parcels last year, 32.8% were in their 20s and 35.5% in their 30s, with the MZ generation (Millennials + Gen Z) accounting for about 70%. The biggest reason young people use parcel services between convenience stores is the low price. For single-person households, picking up items at a nearby convenience store reduces the risk of parcel loss. In the increasingly frequent process of secondhand trading, there is no need to disclose addresses to strangers, increasing safety.

An industry insider said, “As the number of single- and two-person households who find it difficult to pick up parcels on time increases, the reduced risk of loss is a major reason for the growing number of convenience store parcel users,” adding, “With soaring prices, the popularity of convenience store parcels, which can be used at low prices, is expected to grow even more.”