The last mile of home delivery continues to be the most expensive, inefficient and time-consuming step of a product’s journey. It’s also the most critical to the customer experience. As businesses across categories have focused on “fast” as the answer for better experiences in the last mile, drone and robot delivery have become the pervasive vision of future speed. But the technology, standards and regulations are still evolving – we still have a long way to go.
What we’re watching: Walmart autonomous vehicle delivery
Walmart kicked off 2021 with a pilot of autonomous delivery services for groceries using Cruise electric autonomous vehicles in Scottsdale, Arizona. It’s the latest build on years of autonomous delivery test drives.
Tom Ward, SVP of customer product at Walmart U.S. said, “We may be growing delivery options today, but we’re still experimenting with new ways we can use technology to serve customers in the future.”
Ready, Set Deliver: Getting Your Supply Chain Ready for Same-day
As Walmart explores what’s next for home delivery, they’ve made sure the last mile is covered day-to-day for a nationwide explosion of demand. They’re leveraging multiple channels to get orders to customers’ doorsteps.
Across the pond in Ireland, another grocery delivery pilot has been underway for months. Leading grocery chain Tesco partnered with Manna, a drone delivery company, to provide drone delivery services to a town of 10,000 people. Additional businesses of all sizes with all kinds of products have also hopped on as partners, but the modest delivery area remains the same.
If technology is working on delivering your groceries, what’s next? Pizza? Yes. Pizza Hut Israel is partnering with Dragontail Systems Ltd. to test drone delivery this June. They’re taking a hybrid approach where drones drop off multiple orders at a designated site, where good old-fashioned human drivers pick them up and take them to customers’ homes.
According to Ido Levanon, managing director of Dragontail, “Drone delivery is a sexy thing to talk about, but it’s not realistic to think we’re going to see drones flying all over the sky dropping pizzas into everyone’s backyards anytime soon.”
Drone regulations are slowly loosening
The FAA regulates drone delivery traffic in addition to airplane traffic as a matter of security and safety. It’s a natural extension—and they’re not kidding around. Until a couple of months ago, drone delivery traffic over densely populated areas, especially at night with moving people or vehicles, had to be approved by the FAA on a case-by-case basis. This severely limited retailers’ ability to experiment with it.
All that changed on December 28, 2020. Now, drones are allowed to fly over cities and the people in them at any time, as long as they meet some new FAA guidelines. Great news, but the guidelines are complicated. First of all, each drone must have a Remote ID, which has to include different pieces of the following information:
- Drone owner
- Take-off location
- “Control tower” location
- In-flight location, velocity and altitude
Drones must also have physical safeguards, like blade protectors, if there’s a chance they’ll be near people or vehicles. Subtle nuances by location and time of day remain, including pilot certifications and carrier weight restrictions. Legislation is still in the works, with new requirements rolling out this spring. It’s still a tough environment for having total confidence in your drone delivery services strategy.
Getting in a fix with fixed assets
Like traditional trucks, warehouses, containers and forklifts, drones and autonomous delivery vehicles are fixed assets. They come with limitations and overhead, like capacity limits, fleet management costs, hardware maintenance and upgrades. As fixed assets, they are also a significant capex, and the ROI hasn’t been proven out. Their Achilles heel is the same as any other asset-heavy logistics strategy—hardware is expensive.
The fact that drones and autonomous delivery vehicles are not contained at a site, but out and about in the world, can also entail massive amounts of permitting and approvals. You’re not only dealing with the FAA, but also with a buffet of acronyms including the DMV and DOT.
In California, the first permit to deploy autonomous vehicles was just approved late last year, based on legislation nearly a decade in the making. It’s a major milestone for innovation in autonomous delivery vehicles, won by Nuro robotics, but the real-world footprint is small. Nuro’s autonomous delivery services will be offered in just two counties—at the speed of 25 MPH.
In short: The robots are coming our way, but every day until they take over still presents last-mile delivery challenges that have to be solved. Crowdsourcing through Roadie is an asset-light strategy that gives you access to resources already on the road so you can master the last mile now and imagine the changes to come. We partner with enterprises to deliver everything from groceries and medication, to paint and construction supplies, to new tires and lost luggage – ASAP.
According to Roadie founder and CEO Marc Gorlin: “Enterprises across virtually every industry are choosing to crowdsource delivery through Roadie while they wait and see who the autonomous tech winners will be in the next decade or two. With Roadie, businesses meet demand without doubling down on a risky futures bet that can break the supply chain and can’t be inexpensively undone.”
Stay up to date, but stay agile
Roadie’s collaborative crowdsourcing model enables fast, flexible, scalable delivery that reaches 90% of all U.S. households with 200,000+ active drivers—right now. Reach out for a demo of how quickly and easily we can start solving your last mile.