I was fortunate enough to meet up with Egil Moller Nielsen. He is a world leading expert in e-commerce and logistics, with multiple Ivy League degrees and stints all over the world at the top of companies like DHL, Ecco, Lego, Mattel and now Penguin Pick-up at Smart Centres. I sat down with the Ex-Lego-Guru to learn more about why he thinks home delivery was only the beginning of online shopping and how everything is about to change. 
As our conversation opened up, he dove right into what he sees as the first real complication with home delivery, "As much as 65-85% of total delivery costs are associated to the last mile. Ballpark." Supply chain is about reducing factors in cost and time. Egil sees inherit wastefulness in the current home delivery scenario because a large portion of home deliveries are not intercepted on the first attempt. Consumers end up traveling great distances to the nearest courier store in search of their package, damaging the customer experience. Therefore retailers end-up spending many of their transportation dollars on a consumer experience that does not always happen.
Egil's feeling is that the fundamentals are not understood by retailers who are foregoing profit in favor of pressure towards free home delivery and free returns, no matter the SKU or checkout value. In many regards retailers have only considered competing against Amazon on Amazon's strengths and not their own, in being brick and mortar. Egil believes the secret weapon for retailers is going to end up being convenient drive through local pick-ups that augment online shopping. 
In Europe they are ahead of us he explains. "The UK is on its way to 30% of sales being online. European cities are very complex and congested, they gravitated away from last mile deliveries much sooner in favor of locker systems." 
In Europe, people are used to putting in effort to get what they need in congested spaces where using a car is difficult. In North America this is not the case. Lockers have had very little traction. We need something else.
Our cities are geared for the car and our culture is accustom to ultimate convenience. Pick-up points can solve one or two problems for every stake holder in the supply chain. Transportation companies strongly favor 'access points' and business deliveries over home delivery for profitability reasons. Consumers complain they do not have control over home delivery. Retailers are looking shave a few dollars off the cost of online deliveries so they can make profit.
The online world has taken off at the speed of light but logistical infrastructure has not been there to support that growth. Egil believes 2015 - 2017 will be different; a transformational period changing retail entirely leaving it "unrecognizable" as compared to today. As supply chains leverage pick-up points Egil believes we will move toward 50% of retail being online for certain categories. 
Egil latest project is a full service drive through pick-up point called Penguin Pick-up, which he developed on behalf of his new employer, a large REIT and mall landlord. Having lived in Europe, Asia and North America, Egil has an unbiased perspective on what may work for our culture. We have drive through car washes, drive through food, drive through oil changes. Pick-ups are a natural progression for omnichannel retail.

He reminds me there is a second major impracticality in home delivery. The shopper is already taking care of the last mile. "They leave the home each day and then return." 90% of Canadians drive within a few kilometers of a Penguin Smart Centre every day. Canadians visit the grocery store 2.5 times a week. 15% of Canadians are visiting Tim Horton's coffee shop every day. Local pick-up that works is the Holy Grail distribution opportunity for e-commerce and brick and mortar.
"At some point the operation [Penguin Pick-up] may have more dynamics than just a pickup point. We will let the consumers decide but we want to fish where the fish are. Consumers may say the mall landlord can play a much bigger role in the shopping experience."
Some of his ideas he won't share just yet. Egil is philosophical in his approach to retail. He reminds me to keep my mind open. “Retail is logistics." He reminds me. "For the most part it is. Because what is retail? They don't manufacture the products right? It's a matter of distributing the products to the consumers." 
So how does Penguin Pick-up work? It's a drive through concept, but not like a McDonald's. In the mind of a supply chain pro, lines are fundamentally flawed, if one person is slow everyone behind them suffers. Penguin Pick-up is more like a Sonic fast food joint. The consumer pulls up to a parking spot and an employee greets you immediately. Mention your penguin code and they are back with your package in no time at all. 
Pick-ups are changing everyone's behavior. It's a powerful new variable. Couriers are avoiding home delivery. Early adopters are foregoing in store shopping entirely just doing drive through pick-ups. Flower companies use it to deliver flowers safely without packaging. Dry cleaners use it to make your dry cleaning more accessible. Retailers can move inventory from the store across the parking lot and offer drive-by as new one hour online shopping alternative. You can even do things unrelated to retail. Go ahead and leave your keys with a Penguin Pick-up if your friend is using your apartment for the weekend.
When we talk more about the future of online retail and Egil mentions grocery. "This will be a game changer." He tells me. A huge category that will capture a higher share of the consumer's wallet. "I told my team we had to be geared for the minus eighteen and the plus four." Meaning Penguin Pickups can handle all food. Suddenly 50% of online sales is sounding very reasonable.
Egil is quick to explain that Canadian retail is dominated by only a few retailers and that they house many of them in over 250 major malls in their portfolio.