Big Questions in Drone Delivery
November 29, 2016
Prime Air, Project Wing, Matternet. These sound like titles of new science fiction movies, but they are the names of drone delivery programs. And there are many more where those came from. There’s a mini arms race for providing consumer orders faster from unmanned aerial vehicles (UAV), the official names for drones.
Needless to say, this will impact the shipping industry in some large ways—from where and how items are stored in warehouses to packaging designs to fit the drone. Despite the fact that there are more drones registered with the Federal Aviation Authority (FAA) than all the commercial and private planes combined (over 320,000!), many unanswered questions remain about their use. That’s where Ernest Packaging Solutions comes in: we can help you think about what to be asking to get ahead in UAV delivery planning.
How fast is fast enough?
The primary goal of drone delivery is speed. For instance, Amazon’s Prime Air has stated their goal at delivering small items in 30 minutes or less. According to a recent Wall Street Journal article, most online shoppers expect to wait an average of 4.8 days for a delivery (down from 5.5 days in 2012). While we fully anticipate the expected wait time to continue to drop in coming years, it’s unlikely that consumers will expect orders to be on the doorstep before they finish an episode of “House of Cards”.
How much will shipping cost?
Specifically, how much cost will shippers pass to consumers for the convenience of drone delivery? Supply chain software provider, Flexport, has a fantastic article on the economics of UAV package delivery and makes the case that companies like Amazon could offer delivery of 5-pound packages to areas near a warehouse for as little as $1 and still make a profit. Walmart, who would love to take a bite out of Amazon’s online sales, has noted that 70% of Americans live within 5 miles of a Walmart and could create a showdown over who will control the one-hour-or-less delivery world.
When will I get my first drone order delivered?
Amazon appears to be most intent on being the first to deliver via drones, which makes sense. The company has become a consumer favorite for its convenient, cheap and speedy shipping. So being the first to offer 30-minute delivery would fit in line with their brand. But when?
No doubt there will be test markets that are the first to see drone delivery. For a much wider release, a recent Walker Sands’ (via Packaging Digest) survey gives us some insights into what customers are expecting.
Drone deliveries are coming, that much is sure. But who will get them, what kinds of products and who will be responsible for delivering them are still very much in flux.
Do you have questions about what a drone-filled packaging world will look like and how you can position your brand to take advantage? We already create custom packages that can withstand rain, wind, cold and heat—on the ground or in the sky. So there is no need to wait. Give us a call today.