March 7, 2017
Drones have been in the news for several years as Amazon and Walmart have looked to them as an alternative means of delivering goods to customers faster and more cost-effectively. Drone delivery is a true application of technology and supply chain innovation. However, the FAA’s rules regarding drone flights meant many companies, ranging from big to small, were still left with plenty of time for development of drone delivery. Amazon has already tested drones, and last month, UPS did the same with great success. So, what does this new test mean for global drone delivery, and how will impact supply chain functions?
Part of what’s exciting about the UPS test lies in its applications. UPS launched a drone with a package from atop the delivery truck. While the drone navigated its way to the delivery address, the driver continued to drive and deliver another package. When the drone finished its work, it returned to the truck’s new location for recharging. Now, think about what this means. Two deliveries with half the work of a single driver.
UPS is only the latest among major shippers and retailers to begin testing drone delivery, but its successes, including a test flight to deliver sensitive medical supplies last September to an island off Boston’s shoreline, indicates that FAA-approved delivery by drones may be much closer than anyone realizes. According to Supply & Demand Chain Executive, UPS could save up to $50 million annually if drones could eliminate one mile of driving per driver each day. So, this means the prices consumers pay could eventually drop as the cost of getting products to retailers and end-users decreases.
Drones do not have to be used exclusively for last-mile delivery. They could be deployed to serve almost any picking or servicing function across supply chains. In factories, drones could enable faster servicing of equipment located in areas that typically would require ladders, reports Supply Chain Digital magazine. Meanwhile, they could move raw materials into factories faster. But, they go further than that.
Drones could be used in procurement, picking up raw materials from vendors, bringing them back to a factory and putting them on the assembly line. Similarly, using drones as part of supply chain innovation could bring parts to workers, eliminating the driver-factor between regional distribution centers and point-of-service locations, a major change for entities involved in the aftermarket sale of parts and equipment repair.
The government will need to act soon because the number of companies testing drones is growing at a rapid pace. The FAA needs to revise its previous line-of-sight rule, giving your company the opportunity to test drones and receive parts when needed. Of course, for Flash Global customers, the UPS test may signal a forthcoming option for delivery. UPS is among the major carriers Flash Global uses for delivery services, so every test by a major carrier or third-party logistics provider has the potential to benefit Flash Global customers in the future.
To learn more about how Flash Global can help your company meet the challenges an increasingly technology-reliant shipping world, fill out the online contact form now.
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