The Future of Food Delivery: Drones

In response to the COVID-19 pandemic more and more food companies have provided home delivery services. In December 2020, DoorDash made a powerful public market debut with one of the biggest IPOs of the year. A month later, Uber Eats bought Postmates. It was a strong attempt to consolidate their market share. The result was that by July 2021, 49% of American consumers had ordered from one of the leading home delivery services (Uber Eats, Postmates or Door Dash), up 42% on the previous year. Food delivery services certainly have a strong hold on the market, but to stay ahead of the competition they’re each looking to the future, and the answer may come in the form of drone technology.

The Drone Delivery Market 

In 2020 the delivery drone market had a value of $2 billion, but it’s projected to rise to $5.6 billion by 2026, whilst registering a CAGR of 14% in the same period. Despite the mammoth size of the drone market, the industry is still very much in its infancy. But the likes of Google and Amazon have been heavily investing in their own drone technology. 

The concept is simple. An unmanned aerial vehicle (UAV), commonly referred to as a drone, provides many advantages over traditional delivery methods. It’s faster, more flexible and cheaper — since human labour costs are reduced. For example, food delivery app services pay human drivers or cyclists approximately $6 to $8 per delivery they make. But according to an analysis by Ark Invest, it would cost an ‘Amazon Air’ drone only $0.88 to deliver a 5lb product to a customer. Amazon’s drone delivery service is nearing launch, however the development of effective drone delivery of food and beverages is of course more challenging logistically: Amazon deliver parcels. Uber Eats or DoorDash need to send drones from restaurants directly to customer’s addresses with haste. 

Getting Food to Customers Quickly

Although Uber Eats remain tight-lipped about their drone innovations, CEO Dara Khosrowshahi revealed to Forbes that the company was involved in a commercial drone-testing program. “Back in July 2016, UberEats partnered with Dialexa to host an event in Dallas, which featured flying drone delivery. Modified drones, capable of carrying 10 pounds, delivered food to eager guests on the ground. Due to Federal Aviation Administration (FAA) regulations, the drones could not go higher than 400 feet and required a human pilot on the ground”.

But what about safety concerns? In busy urban areas, how will food delivery drones negotiate trees, birds, and other drones? The prominent players in the aircraft delivery drones market such as DJI, United Parcel Service of America Inc., Zipline, Deutsche Post AG, Flytrex, and Amazon.com Inc are all developing was to overcome these problems with technology. And it seems likely that your favorite restaurant will be dropping your food off by drone sooner than you think!

Is your food and beverage company looking to scale with ERP, traceability or demand planning software? Get in touch today to learn how CASHMERE can help your food and beverage business thrive in a competitive digital marketplace.