Is drone delivery the future of last-mile delivery?

Nienke van Meekeren
January 8, 2021

E-commerce continues to grow with no signs of slowing down as more consumers are finding their way to online stores. At the same time, the pressure on the environment continues to increase. These circumstances make the need for smarter logistics more urgent than ever, especially with regard to last-mile delivery. After all, the last-mile is one of the most polluting, most expensive and least efficient parts of the entire logistics chain. More companies are looking into and experimenting with delivery drones as a cost-effective, environmentally friendly answer. Are these innovative delivery vehicles the future of last-mile delivery?

The current use of delivery drones
A drone is a small, autonomous robot that can be controlled either remotely or by following an internal flight path on its own. With a drone, parcels of 5 to 30 kilograms can be delivered at a speed of approximately 100 km/h. At the moment, it is mainly American companies, such as Amazon and UPS, that use or experiment with delivery drones, because the US is paramount in allowing and registering (delivery) drones. For example, Amazon is developing a future delivery system, Prime Air, to get packages to customers in 30 minutes or less using drones, and UPS and CVS have teamed up to deliver prescription medicine via drone.
A cost-effective answer
As a share of the total cost of shipping, last mile delivery costs are substantial — comprising more than 50% overall. Researchers attribute the high costs for the last link in the logistics process to various cost-increasing inefficiencies, such as lack of delivery guarantee, sub-optimal delivery routes and non-combined returns in urban areas. Moreover, obstacles like road closures, heavy traffic and parking restrictions make the last mile enormously time and energy consuming. Research shows that using electric, autonomous drones for package deliveries can result in operational costs that are at least 70% lower than a van delivery service. These cost savings come from avoiding heavy traffic. Moreover, this makes it possible to deliver parcels quickly to the consumer, especially if the drones fly directly from the brick-and-mortar store to the consumer’s home.
A sustainable solution
CO2 emissions from freight transport are responsible for 30% of all transport-related carbon emissions from fuel combustion. Traditional delivery vehicles that run on petrol or diesel lead to high fuel loss and loss of time due to frequent braking, acceleration and standstill. The use of delivery drones for the delivery of products ordered online can help make the logistics industry greener and reduce its carbon footprint. Delivery drones can cover greater distances in shorter amounts of time, thereby saving fuel, reducing costs per kilometre and reducing their carbon footprint.
The future
At the moment, drone delivery is especially beneficial for the delivery of medicines, but not yet for the large-scale delivery of packages containing products ordered online. There is still a lot to be done in the field of regulation, privacy and technology for delivery drones to become the norm. This includes developments in the field of the range of the drone, battery life, the maximum weight that a drone can carry and safety. As technology continues to develop, the safer and cheaper drone delivery can be used and the more companies can and will make use of this fast, cost-effective and environmentally friendly way of delivery. McKinsey predicts that drones will make up to 80% deliveries in the future.

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