KEY POINTS

  • Drone delivery offers tremendous benefits in the form of cheaper, faster shipping. In particular, drone delivery can help companies smooth the incredibly time-consuming and expensive “last mile” of delivery, the last leg of a package's journey before it reaches the consumer.
  • A wide range of companies are testing drone delivery to learn how they can leverage those benefits. These include e-commerce companies, legacy retailers, logistics providers, and tech firms.
  • There are two main types of drone delivery these players are exploring: home drone delivery and supply chain delivery. Although home drone delivery receives the bulk of public attention, using drones to make deliveries within the supply chain can smooth out the fulfillment process and increase efficiencies.
  • However, there are significant regulatory and technology barriers that will postpone mainstream adoption of drone delivery until after 2020Barriers include regulatory hurdles, consumer acceptance, and technical issues related to ensuring safe and reliable delivery by drone. 
  • Mainstream adoption of drone delivery will take place in stages over the next few years as regulations are put in place and drone technology improves. Right now, most tests are extremely limited in scope, take place in rural areas, and do not actually deliver packages to customers’ front doors. These tests will gradually progress, eventually bringing drone delivery to more customers in populated areas.

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Introduction

Drone adoption is rising fast among both consumers and companies, and the retail industry is just one of many exploring new uses for the technology. Drones [...]