The verdict in three sentences
The pickup point is almost always more profitable than home delivery: in Kampala in 2026 it costs 500 to 1,000 FCFA versus 2,000 to 3,000 FCFA at home, with a failure rate of 4% versus 15%. The right strategy is not to remove home delivery but to position it as a premium option and push the pickup point as the economical choice. With a 1,000 FCFA discount, 38% of customers adopt the pickup point, easing your whole logistics.
The cost and failure math
Let's compare both modes on the two variables that matter: delivery cost and failure rate. The pickup point wins on both, at the price of a slight effort from the customer who must travel.
| Criterion (Kampala 2026) | Pickup point | Home delivery |
|---|---|---|
| Cost per parcel | 500-1,000 FCFA | 2,000-3,000 FCFA |
| Failure rate | 4% | 15% |
| Collection/delivery time | 1.8 days | 1.4 days |
| Customer adoption (with −1,000 FCFA) | 38% | 62% |
| Commission paid to pickup point | 200 FCFA/parcel | — |
| Required network density | 1 point/2 km | — |
The pickup point costs 2 to 4 times less and fails 4 times less. The only price is a slightly longer collection time (1.8 days) and the need for a dense network: about 1 pickup point every 2 km to keep the option attractive.
The economics of the pickup network
Each pickup point earns a commission of about 200 FCFA/parcel, which motivates it to manage collections well. For the store, a parcel moved from home (2,500 FCFA, 15% failure) to a pickup point (800 FCFA, 4% failure) saves both the ride and the re-deliveries.
| Scenario over 100 parcels | Home | Pickup point |
|---|---|---|
| Ride cost (100 × rate) | 250,000 FCFA | 80,000 FCFA |
| Failures | 15 parcels | 4 parcels |
| Re-deliveries (× 1,500 FCFA) | 22,500 FCFA | 6,000 FCFA |
| Total cost 100 parcels | 272,500 FCFA | 86,000 FCFA |
| Cost per delivered parcel | ~3,205 FCFA | ~896 FCFA |
The pickup point divides cost per delivered parcel by more than three. Even converting only 38% of customers, the impact on overall margin is major.
Positioning both offers
Best practice is to show the pickup point free or at −1,000 FCFA against full-price home delivery. The self-sufficient, price-sensitive customer picks the pickup point; the rushed or premium customer pays for home delivery. You capture margin either way and smooth your routes.
Mini case study
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Namutebi, who runs an accessories store in Kampala, ships 100 parcels/day all-home: cost ~272,500 FCFA/day (ride + failures), about 7.08M FCFA/month. By introducing a pickup network and a 1,000 FCFA discount, 38% of customers switch (38 at pickup, 62 at home). Pickup cost: 38 × 896 = 34,048 FCFA; home cost: 62 × 3,205 = 198,710 FCFA; total ~232,758 FCFA/day. Saving: ~40,000 FCFA/day, about 1.03M FCFA/month, just by offering the choice.
FAQ
Is the pickup point always cheaper than home delivery?
Yes, in Kampala in 2026 it costs 500 to 1,000 FCFA versus 2,000 to 3,000 FCFA at home, with a failure rate of 4% versus 15%. Cost per parcel actually delivered is more than three times lower.
How many customers accept the pickup point?
About 38% when you offer a 1,000 FCFA discount versus home delivery. Without an incentive, adoption falls because customers prefer home convenience.
What network density is needed?
About 1 pickup point every 2 km in urban areas. Below that, the customer's trip becomes off-putting and adoption collapses.
How much does a partner pickup point earn?
About 200 FCFA per parcel handled. This modest commission motivates good collection service and secure storage of waiting parcels.
Should you drop home delivery?
No, keep it as a full-price premium option. The pickup point captures price-sensitive customers, home delivery serves rushed ones: you keep the margin either way.
Let's talk about your project. We wire a pickup-point network and the home/pickup trade-off into your checkout. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
