In the race to eliminate last-mile logistics costs, Suzannah Murphy looks at who's doing what in the busy world of drone innovations.
Let’s be honest: there’s been a lot of drone-related news this year. With all these stories flying around faster than the drones themselves, there’s no better time for me to sit down and see what all the fuss is about in the race to eliminate last-mile logistics costs.
It seems we can’t talk about supply chains without first mentioning Amazon these days (my colleague, Laura, wrote a blog post a couple of months ago on how the online giant’s making supply chain cool). So it’s no great surprise that Amazon’s putting its two pennies’ worth into the debate with its Prime Air drones.
Delivery in 30 minutes
Amazon’s Prime Air service will deliver packages up to 2.26kg via – you guessed it – drones. If successful, deliveries could be made 30 minutes after an order is placed. The unmanned delivery units can carry around 86% of the parcels currently delivered by Amazon via conventional means.
An uphill battle?
While it all sounds good on paper, there are a number of obstacles to get past (or fly around). In the US, for example, the online retailer has run into difficulties testing drones, as the degree to which the technology can be tested is dependent on the Federal Aviation Administration (FAA)’s strict policies regarding flying drones for commercial use.
It’s not all bad news for Amazon, though. Here in the UK, the Civil Aviation Authority (CAA) has just granted it permission to test three innovations: beyond line of sight journeys in rural and suburban areas, testing that drones can identify and avoid obstacles and flights where one person oversees multiple drone journeys simultaneously.
Just last week, I heard that Amazon has taken another step in developing its new delivery system. It’s obtained a patent for drones landing on docking stations located on tall structures, such as lampposts or church steeples, using them as delivery stations that would be connected to a central control station. Not only would the stations be able to unload parcels and recharge, they’d also be able to reroute drones in the case of bad weather. Of course, this patent may never come to fruition, but it’s an interesting possibility and shows us – once again – that Amazon really does think outside the box when it comes to its supply chain.
Improving the parcelcopter
Meanwhile in the logistics world, it’s no great surprise that DHL’s been looking into improving its version of the technology – the ‘Parcelcopter’. Its first generation model, launched in 2013, could fly 1km at 43km/h and carry up to 1.2kg. It was controlled manually and didn’t have any altitude difference capabilities. Fast forward to the first quarter of this year, and DHL’s (fully autonomous) third generation version can carry twice as much as the first generation model, has a range of over 8km at 70km/h and can cope with the varying altitudes of mountainous regions.
Reducing last-mile costs
It’s an impressive amount of progress for DHL: not only is the drone fully autonomous, it’s able to fly over terrain that would be challenging for a human to cover. This means that DHL can significantly reduce last-mile delivery costs, which are especially high in rural areas. With its ability to automatically load and unload packages, it would be great to see the Parcelcopter trialled in urban areas next. Perhaps this is where drones will find their niche – at least in the short term - in environments where benefits outweigh risks.
First US grocery delivery
There’s one retailer that’s managed to do what no others have yet achieved: a week ago, Seven & I Holdings made the US’ first ever drone delivery to a customer’s home. The drone was operated by Flirtey, a leading independent drone delivery company, and it autonomously transported hot and cold food from a local 7-Eleven store to a customer’s garden in minutes. It’s an historic moment – not only for Seven & I Holdings and Flirtey – but for what has been described as the ‘ultimate convenience’ delivery system for customers.
Source: Seven & I Holdings
The two companies now plan to expand the drone delivery tests, continuing to work closely together to transport immediate consumables from store to home: a first for the industry.
More than just drones
It’s not all about the drones in the race for last-mile optimisation, though. Starship Technologies have been testing their self-driving robots in Greenwich, London. Like Amazon’s Prime Air, DHL’s Parcelcopter and Firtey’s drones, these robots are autonomous, but they don’t fly – they use the pavements (sidewalks if you’re reading this in the US) as pedestrians do, traveling at fairly low speeds, holding a couple of shopping bags’ worth of weight and have a range of just over 3km.
Source: Starship Technologies
Starship says that its entire delivery platform is both energy and cost efficient, and aims to make the last-mile deliveries by robot completely free. This is great news for small businesses trying to move into ecommerce, where home delivery costs are currently very high. Starship Technologies is speaking at our Supply Chain Summit in November so don’t forget to book your place!
Innovation and exploration
It’s clear, then, that the threat of rising last-mile delivery costs has led to a significant level of innovation and exploration. It’s unlikely that every innovation out there will take off, but 10 years ago, who would have thought we’d be ordering goods online for delivery within an hour? Having said that though, that might not be fast enough, and it’s likely that the consumer thirst for faster, cheaper deliveries will continue to pile costs into logistics, but also present opportunities to win for those that recognise and respond in the right way.
So what’s next for the industry? I’m not sure – but I’m looking forward to finding out.
Online Content Co-ordinator - Supply Chain, IGD