Supply chain shifts: what drones will deliver next (clue: it's not pizza)

The small red craft launches into the air, and glides effortlessly over the stretch of water. It lands on a small patch of grass, where delivery drivers remove the package attached, and take it on to customers through their usual delivery routes in vans. 

These are mail delivery drones, and they are bringing letters and parcels to the remote islands of Orkney, Scotland, as part of a three-month trial. If successful, drone deliveries could become a permanent fixture, replacing dependence on unreliable ferries for the mail.

Though the operation is the first of its kind in the UK, a joint project between Royal Mail, LoganAir and Orkney Council Harbour Authority, it is a sign of things to come.

Because while drones were once tipped to become the delivery service of our goods, medicines and food — not forgetting pizza — the reality has turned out slightly differently.

Crowded urban environments have proved to be a bit of a headache for would-be drone operators. Privacy concerns, tall buildings and other obstacles make flying unmanned aerial vehicles (UAVs) a complicated business. 

Some delivery companies such as Amazon have trialed drones for last-mile delivery. These could work alongside other compelling options for urban areas, including e-bikes and cargo bikes. But arguably the best case for drones is in nations made up of collections of islands that have fewer alternatives. Many are starting to use drones already.

Flying high

“We are particularly pleased about the new transport route, which we are opening today, attempting to significantly change the daily lives of the border islands' residents," said Apostolos Georgantzis, CEO of Quest Group and President and CEO of ACS. He was speaking in September as his company launched the first drones taking medical supplies from Kos in Greece to Pserimos, a nearby island that has historically suffered from poor connections.

The collaboration between ACS, Pleiades IoT Innovation Cluster and PROBOTEK was a signal that Greece is moving away from a dependence on boats and ships toward these transportation modes of the future. Dronelife publication said it “could be lifesaving" to have medicines delivered in this way.

And it isn't just in Europe that island nations are seeing the benefits. At the recent Amsterdam Drone Week, businesses from the APAC region highlighted how the geography of many countries there lends itself well to Urban Air Mobility (UAM).

“UAM is about connections," said Diana Cooper, Global Head of Policy at Supernal, a Hyundai subsidiary. “We're working in Indonesia, which is a country of more than 17,000 islands. This is a good solution for connecting these islands — there is no other really effective way."

This can include other craft such as helicopters. But drones are a very effective way to deliver goods, especially now that electric drones are robust enough to tolerate bad weather. A study by PwC estimated that drones could reduce the delivery cost per mile from US$2.50 to US$0.05 and the delivery time from 30 minutes to 10 minutes. Combined with accurate, dynamic maps, drone delivery can be fast as well as cost-effective.

In our recent APAC On The Move survey, drone technology was highlighted as a key area of investment for logistics companies in the region, which includes nations made up of islands such as Indonesia and the Philippines.

While we are still waiting to see them deployed for our pepperoni with extra cheese, drones are already bringing islanders the things they need, right across the globe.