An up-and-coming delivery avenue that has sparked an interest in not only the supply chain industry, but also the general public, is the use of drones in last-mile delivery. Even though this idea has become a popular concept, it is not currently deployed in the United States and is only in testing stages.1 The U.S. has been at the forefront of many technological developments, but has been behind in the use of drones due in part to Federal Aviation Administration (FAA) regulations. Outside of the U.S., companies in Australia, Singapore, and Britain are currently leading the way for implementing drone deliveries and taking their logistics to new heights.2
The Inception of Drone Deliveries
When the idea of “drone delivery” was first publicized during an episode of 60 Minutes back in 2013, it was estimated to be four to five years before consumers would begin receiving products delivered by drones.3 As the end of the initial projected timeline approaches, consumers in the U.S. have yet to receive packages delivered to their doorstep by drones. One major setback with this innovation in the U.S. is the restrictions set by the FAA. The most prominent restriction is known as the “line of sight rule,” which mandates that drone operators keep the drone within eyesight at all times during the flight.4
Diverse Consumer Outlooks
Regardless of the current restrictions, expectations for drone deliveries are set high by both the industry and the consumers. Both parties expect efficiency, time and cost effectiveness, and high customer satisfaction.
A recent study, based on 1,400 U.S. consumers, found that the hype around drones created by e-commerce companies like Amazon has created a gap between expectations and reality.5 The excitement of drone deliveries has formed a notion that even faster delivery is possible – many consumers now want their purchases delivered within the hour. The survey results also found two-thirds of consumers expect to receive their first drone-delivered package in the next five years, and nearly 80 percent are willing to pay for it.5
Not all consumers are completely on board with drone deliveries. In fact, in a separate national survey by the USPS Office of the Inspector General (OIG), only 44 percent of respondents stated they like the idea of drone deliveries, 34 percent do not want drone deliveries, and the rest are unsure.6 A third of all respondents said they thought drones may be unsafe, expressing concerns that drones could malfunction and injure people or damage property.6
Younger generations and frequent e-commerce customers are more enthusiastic about drone delivery. Sixty-five percent of millennials like the idea of drone delivery, compared to only 24 percent of baby boomers. These same respondents ranked delivery speed as one of the top benefits of using drones within the industry.6 Overall, many consumers have mixed opinions on the concept of drone deliveries, and whether or not companies should incorporate this service.
Although drones are not quite ready for the anticipated role in last-mile delivery of consumer goods due to FAA regulations, they are beginning to influence the supply chain industry through less technically-challenging tasks. Companies within logistics may benefit from utilizing drones and other automated technologies to be more efficient in tracking warehouse inventory, making internal deliveries, managing security and monitoring the safety of employees.7 Sophisticated shippers and third party logistics providers invest in these innovations and additional technology to enhance operations and continue to improve the customer experience.