Drone deliveries a reality for retailers

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Drone deliveries a reality for retailers

By Mike Troy - 10/06/2019

While retailers are focused on expanding and refining delivery methods and click and collect programs, UPS has received a new certification that moves drone deliveries closer to reality. The Federal Aviation Administration granted the UPS subsidiary UPS Flight Forward Inc. what’s known as a Part 135 Standard certification on Sept. 27. The certificate permits the company to fly an unlimited number of drones with an unlimited number of remote operators in command who do not need to maintain line of site with the drone. The Part 135 Standard also permits the drone and cargo to total 55 pounds and fly at night, previous restrictions that governed earlier UPS flights.

The 55 pound weight limit is considerable and addresses a key limitation that made drone impractical for the delivery of a larger orders. However, with a 55 pound limit, a UPS drone could conceivably deliver a grocery order of several dozen items including a bag of pet food and a jug of laundry detergent.

“This is history in the making, and we aren’t done yet,” said David Abney, UPS CEO. “Our technology is opening doors for UPS and solving problems in unique ways for our customers. We will soon announce other steps to build out our infrastructure, expand services for health care customers and put drones to new uses in the future.”

Health care is the initial use case due to the potential for extreme time sensitivities and high value items that make the economics work. For example, UPS said it will initially expand its drone delivery service piloted earlier this year at the WakeMed campus in Raleigh, N.C. to support hospital campuses around the country. That service demonstrated the business case for drone delivery of medical products and specimens, according to UPS.

Medical products are one thing, lower margin, less time-sensitive food and consumable products are a different matter. However, unfavorable economics haven’t prevented retailers, be they food or general merchandise operators, from pursuing costly fulfillment methods because they know shoppers demand convenience.

The Drones Are Coming

The drone type used in the UPS medical deliveries is the M2 quadcopter manufactured by Matternet, a company that has received investments from Boeing’s HorizonX Ventures group and the Sony Innovation Fund. The M2’s limited capacity of five pounds and range of 12.5 miles means it isn’t practical for most food and consumable deliveries. However the certification granted to UPS places no limits on the size or scope of operations, only a weight limit of 55 pounds. It is that hefty weight limit that creates intriguing possibilities for food retailers in particular, along with Matternet’s goal to make access to goods as frictionless and universal as access to information.

UPS has said it plans to integrate drones into its existing logistics networks, rapidly build out ground-based, detect-and-avoid technologies, construct centralized operations centers and partner with additional drone manufacturers. Meanwhile, the FAA has multiple pilot programs underway, the findings of which will inform a new regulatory framework for drone flights and pave the way toward integration into retail supply chains.

Last October, the FAA launched the Unmanned Aircraft Systems (UAS) Integration Pilot Program consisting of 10 state, local and tribal governments partnering with private sector companies to explore drone operations.

“Data gathered from these pilot projects will form the basis of a new regulatory framework to safely integrate drones into our national airspace,” U.S. Secretary of Transportation Elaine Chao said at the time.