Shipping & Fulfillment

Will Drone Delivery Help Ecommerce?

For 20 years I have consulted with ecommerce companies, from startups to established merchants. The one constant during that time is change — nonstop evolution and progress.  This post is the first in a series that will focus on ecommerce innovation.

This installment will address drone delivery.

Drone Delivery

Many companies are focusing on drone delivery, including Amazon via its Prime Air.

Flirtey launched in 2013 in Australia but is now based in Reno, Nevada. It is a leader in drone delivery in the U.S. in terms of test flights and obtaining government approvals.

Flirtey launched the Eagle drone this month.

Flirtey launched the Eagle drone this month.

Flirtey made its first Federal-Aviation-Administration-approved drone delivery in July 2016 from a 7-Eleven store in the U.S. to a residence. Since then Domino’s has also become a customer. The company has raised over $16 million in funding.

This month Flirtey launched the Eagle, a drone that can deliver “75 percent of packages” to customers’ homes during last-mile deliveries and operate in “95 percent of wind and weather conditions.” According to Flirtey, the Eagle does not go near humans. Instead, it lowers the delivery box using a tether.

Workhorse is another drone-delivery company that produces electric delivery vehicles for customers such as UPS and FedEx. Workhorse’s Horsefly drone can fly at speeds of 50 mph for 30 minutes. The company’s stock is publicly traded (NASDAQ: WKHS).

The Horsefly drone always stays within line-of-sight of Workhorse’s electric delivery trucks. Nonetheless, the process could save time and money for the delivery of packages.

Workhorse's Horsefly drone can fly up to 50 mph for 30 minutes.

Workhorse’s Horsefly drone can fly up to 50 mph for 30 minutes.

Benefits

One of the obstacles of online shopping compared to physical stores is the time required to receive products. Drone delivery can change that. Here are some benefits overall.

  • Speed. Drones can deliver products quickly, from a few minutes to a few hours depending on the origin and destination.
  • Mobility. Drones do not require roads. They can go anywhere — over mountains, across water, in a park — with the right coordinates.
  • Cost. Drones are cheaper than delivery vehicles. They typically save labor costs, too.
  • Tracking. Drones allow for real-time tracking — for merchants and customers.
  • Perishable goods. Drones can safely deliver perishable foods or medical supplies. Drones could disrupt food delivery services such as Uber Eats, DoorDash, and Foodpanda, as well as local couriers such as Postmates.
  • Environmentally friendly. Drones leave a tiny carbon footprint compared to a truck or car.
  • Traffic congestion. Drone deliveries reduce overall traffic as there are fewer delivery vehicles on the road.

Challenges

Drones present challenges, too. Here are a few.

  • Legality. Drone delivery is not legal in all locales. It needs universal approval for mass adoption.
  • Package size. Drone delivery is limited to smaller products. Drones cannot deliver larger items such as televisions and bicycles.
  • Weather. Drone deliveries are not possible in bad weather — high winds, heavy rains, or snow.
  • Birds. Drones can fail if hit by a bird.
  • Theft. Drone deliveries could result in more theft as criminals down the units to steal the products. Destroying a drone would be expensive, too — upwards of $500 each.

In Use

Drones are already used for delivering products in Iceland and delivering medical supplies in Tanzania and Rwanda. Denmark, France, and The Netherlands are soon to follow.

In short, drone delivery is an innovation that could greatly help ecommerce merchants.

Gagan Mehra

Gagan Mehra

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