Developing a flight plan for drone-based parcel delivery

This is an excerpt of the original article. It was written for the November 2022 edition of Supply Chain Management Review. The full article is available to current subscribers.

November 2022

Are you resilient? It’s not an idle question. If there’s one word that I’ve heard at every supply chain event I’ve attended this year, its resilience. It is, of course, in response to the last few years in supply chain management. I think its fair to say that supply chains have been knocked to the canvas more times than Rocky. What has become clear as we do our post-pandemic reviews is that the firms that demonstrated the ability to get up off the canvas and keep punching were those that invested in resiliency before the pandemic—even if they didn’t use that term.

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The global cost of parcel delivery, excluding pickup, line-haul and sorting costs, is approximately $80 billion per year, and is growing annually at a rate of 7% to 10% in developed countries and almost 300% in developing countries such as India. The last mile is critically important because it represents a disproportionately large share of parcel delivery costs to the consumer. Hence, it is not surprising that there is much activity around finding innovative last-mile solutions that minimize costs and maximize service levels, especially in dense urban centers.

Aggregated solutions like parcel lockers and public drop-off points are being deployed, and multi-echelon options are gaining in popularity as large trucks become increasingly ill-suited to urban routes. But the technology that has perhaps received the most public attention is unmanned
aerial vehicles, commonly called drones.

The type of unmanned aerial vehicles for last-mile delivery (UAV-LMDs) envisoned by most last-mile logistics players is unique in three ways: low per-vehicle capital costs, autonomous operation and the ability to travel rapidly point-to-point. Yet the vision of fleets of drones traversing city airways to deliver parcels remains far from reality.

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