Monthly Archives: January 2014

Why Amazon drones is not a solution for universal delivery

All the virtual shop use a courier service to deliver their products. The cost of delivery is significant for virtual shops and depends on the products (price of the products and the delivery distance) the delivery cost may go near 10 % from the  product price. It is a good practice the virtual shops looking carefully for the delivery costs and try to lessen this costs.

At the end of last year i saw a marketing movie from Amazon witch make delivery with drones. The movie it is only for marketing they will not use the drones for delivery very soon, because from logistic point of view it is difficult to do this job. But, because it near Christmas and Amazon like any other online shop need good marketing the movie achieve his scope: make a lot of noise on the Internet.

Read few reason witch make Amazon implement drones a difficult tasks:

–          All drones must be controlled by human (the drones that we saw in the movie) and the technology do not allow autonomous drones. So you will use one man to controlled one drone instead of 1 man to delivery the goods. You will payy the man in any cases, but maybe the salary of a drone controller can be lower then the deliveryman.

–          Autonomous drone cannot be used right now because the precision of the GPS it is not so accurate and it is possible sometimes the drone will let the parcel in the neighbor not in your yard.

–          Autonomy of the drones it is a problem, because according to my info the drone autonomy is 20 km and this means that you must to place a warehouse in center of the area the drone can delivery. This means more warehouse than now and this warehouse must be placed in the residential area. This means more costs witch is caused by the number of extra warehouse and by the higher rented value for the warehouse.

–          More warehouse means more products on stock or increase the value of delivery time.  If you decide to have more goods on stock to keep the same service level at delivery time, this means more money blocked in stock. If you decide to increase the delivery time this means problems with the clients. Also increase the number of warehouse will increase the defiective products because of the manipulation. In any cases means more costs for company.

–          If you delivery (for example) 6 regional warehouse instead of 2 (using drones increase the number of warehouse) will increase the delivery cots to regional warehouse.

–          Delivery with drones means that every client have a personal space where the drone can leave the parcels and this can happens in some special conditions and cannot be used for all clients.

–          In real life delivery with drones it can have also other problems: as we saw in the movie the drone leave the parcels in the front of the house. If you have a dog and the drone leave the parcels there that parcel will become the new toy for the dog and when you come home you will find the parcel but in small pieces because the dog will destroy the parcels.

–          Delivery with drones means that you must use special boxes for delivery. Manage this boxes will increase the price of delivery because you must recover the boxes on every delivery (witch is not possible all the time) or use a unique boxes on every delivery (higher costs than recover the boxes). In any cases the cost will increase;

Every drone must recharge every 1-2 deliveries or replace the battery. Management of recharge or battery management will also increase the costs of the delivery.

For my belief the delivery with drones it is not a universal solution because it is necessary to solve a lot problem before to use this kind of delivery and also increase the cost of delivery.

It can be use in certain condition and for certain products (product with high price where the costs of delivery is low no matter what delivery solution you use).

But the movie it is good for marketing and I want to congratulate Amazon for the viral effect on the movie.