Pass My Parcel has been acquired by DHL subsidiary UK Mail after Connect Group failed to improve its business and put it up for sale two weeks ago.

It is believed that UK Mail acquired Pass My Parcel as the ‘pick up / drop off’ (PUDO) service is a key part of the delivery company’s returns service and it stood to lose revenues while rebuilding a similar relationship elsewhere.

One of the problems that Pass My Parcel faced under Connect Group was a much vaunted tie up with Amazon. After the PUDO network invested several million in making the relationship possible, it appears that Amazon used its own internal PUDO system instead and left Pass My Parcel in the cold with some losses – the promised gold rush never materialised.

The PUDO sector is often dependent on high volumes and low margins due to the competitiveness of firms vying for business. It seems that Pass My Parcel didn’t manage to garner enough clients to make this possible and this hit its bottom line. PUDO firms need to be carrier-agnostic (as Collect Plus has become by retaining sister company Yodel as a client but using other delivery firms too). Not enough delivery companies linked into it. No industry insider believes there is an oversupply of PUDO points. A competitive company can make headway.

What of the future for Pass My Parcel? Its only reason for survival is that UK Mail had become too dependent on it. UK Mail is owned by DHL, which is among the top three delivery companies worldwide. The two parent companies are well run and it is generally believed that if the PUDO firm can survive and thrive, it is in the right hands to make it so.