Hover boards and flying cars may still be a long way off, but forward-thinking e-commerce giants have made huge strides in newer and more efficient delivery methods. Autonomous drones are viewed as the way of the future, and many companies and communities are already pushing to turn science fiction into reality. Embracing the technology will shorten the gap between warehouse and consumer while reducing logistics costs.
Aviation giant Boeing, after assessing the viable impact of drone service on last-mile delivery, unveiled its drone prototype in January, positioning it as a key supplier of drone tech for smaller-parcel delivery companies wanting to compete against the largest e-commerce giant, which plans to launch a drone fleet soon.
Internationally, drone delivery has already taken off. Israeli-based drone manufacturer Flytrex partnered with AHA (Allra Hagur), an Icelandic e-commerce company, to deliver packages via drone in the Reykjavik metro area. The companies have been greatly successful in Iceland, reporting a 60% reduction in delivery costs over land alternatives.
E-commerce companies are racing to duplicate the success in Southern California, once regulation permits. The region is more densely populated than Reykjavik, but two factors could make the economics of drone delivery work. First, most goods bought online here are lightweight packages, such as clothes, electronics and books. Second, delivery distance to populated areas is relatively short. The region’s estimated last-mile distance is 9.2 miles, meaning a drone could reach 95% of SoCal’s adult population. Despite the advantages, the biggest hurdle delaying mass drone deliveries to consumers is Federal Aviation Administration authorization, which could swing in e-commerce’s favor this year, when more FAA clarifications are imminent.
