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Autonomous logistics: the benefits and holdups affecting its use in the supply chain

Published date: 29/06/2018 09:49

When Amazon first announced it was going to be launching its Prime Air delivery service in 2016, we thought that was it. The sky was going to be full of drones, flying from A to B like mechanical storks, bags full of goods for awaiting customers. As you may have noticed however, that hasn’t quite become the case. Our flightpaths are still mainly drone-free, and we aren’t settling into the kind of home delivery services we may have initially anticipated. Regardless, the use of drones is still a hot topic. So, what exactly is the pull to using autonomous logistics?

Although Amazon has led the charge, it isn’t alone in touting the benefits of the tech. Two other high-profile examples include UPS and Domino’s, who have both been vocal about their belief in its potential. UPS has estimated that by cutting off just one mile of the routes of its deliveries it could save $50 million, reason enough to warrant its testing of drone deliveries. Domino’s meanwhile delivered the first pizza by drone in 2016 to a New Zealand couple, stating publicly since that drones will become an essential part of its future delivery operations.

These examples make the case quite plainly for the two primary reasons that autonomous logistics is considered an example of next-gen tech that could work. Namely, that it has the potential to cut down on the cost and the time spent on deliveries. Amazon made over five billion deliveries in 2017, which is estimated to have led to a spend of at least $20 billion. Using drones would have resulted in a smaller fee, with ARK Investing Group suggesting each trip could cost as little as $1 per shipment. The case for autonomous logistics is clear, so why hasn’t it been adopted on a wider scale?

Part of that reason comes down to investment in the technology. This doesn’t just mean financial investment, but also companies showing faith in the tech by endorsing it publicly. As more and more companies do this, it will further legitimise and accelerate the pace at which it is used in the industry. The main reason behind its adoption being halted however is that the tech isn’t at a level where it can be trusted to work efficiently and reliably. Not only is the current general perspective on autonomous logistics holding it back, but there also needs to be further developments in the technology to get it to a stage where it can plausibly be used on a mass scale in the logistics industry.

Autonomous logistics has long been touted as the next big thing for the industry. Amazon was one of the first companies to try its luck with the new tech, though as of now it has yet to become much more than a marketing stunt. That isn’t to say that it won’t play a pivotal role in the future, which it undoubtedly will, though for now it’s best left to the marketers and boardroom meetings discussing the next generation of supply chain tech.

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