Express operator DPD is to invest £175m to build a new hub in the East Midlands and expand capacity at its other sites to match online retail growth.
The company said it had generated more than £70m of new business following the launch of its Predict service in March 2010.
DPD said that the new £100m parcel sorting hub would be one of largest of its kind in Europe.
The company has also allocated £20m to refurbish two existing hubs and £12m to build ten new depots over the next 15 months.
Other investments include the replacement of all the handheld devices used by drivers for route optimisation and parcel administration and ongoing investment in security and IT upgrades. DPD expects to create 1,500 new, full-time jobs.
The Predict service uses GPS tracking to provide customers with a one-hour delivery window so they do not have to wait in all day for their parcel. DPD reckons that more than 97 per cent of the parcels delivered each year with Predict are delivered right first time.
DPD chief Dwain McDonald, pictured, said: “The online retail market is expanding rapidly with consumers now prepared to buy a much wider range of goods online. With Predict we have a product which gives retailers greater confidence that their goods can be delivered both on time and straight into the hands of their customers.”