The changing face of retail supply

Drone AuspostOn 13 December 2013 I wrote a column entitled Why internet sales may prevail and I floated the notion of drones delivering goods to homes.

This month on 15 April 2016, almost two and a half years later, Hannah Francis from the SMH wrote about Australia Post testing drones for parcel delivery and  the real thing may be as close as this year! A video showing fascinating footage is embedded in the article.

While not wishing to drone on, it appears that this is closer than some may have thought. After my article in 2013 I received feedback from colleagues suggesting that I should consider a mental check up. I hope they are eating their words.

Of course over time this service may not be exclusive to Australia Post but good on them for being at the forefront.

As we all know, Australia is the regulation capital of the world so it may come as no surprise that there is a rumour of a frenzy taking place behind the scenes by the aviation authorities on how to regulate drones.

This will be necessary to minimise injury and accidents and to protect privacy, but how it will evolve is a mystery. I daresay licenses will be required and inspectors will hide behind bushes to take a slingshot at any unlicensed offenders. But seriously, it may not be a bad thing for Australia Post to get exclusivity on drone deliveries. And if this happens, it may reopen the door for Australia Post and third party warehousing. Take the example of a very small car workshop owner who needs to rely on a quick delivery of parts. They service almost every brand of car and cannot possibly have all the spare parts they require in stock. The likes of Repco have a fleet of vehicles driving parts to workshops all over the place. Why not “droneit” from an AP warehouse?

If Repco had AP provide 3P warehousing, parts could be delivered almost anywhere within an hour. Instead of your car staying in overnight, you would get it back the same day.

Suffice it to say that drone delivery will happen and it will change retail (and other industries). As in my original article, internet sales may be the main beneficiary but bricks and mortar retailers will benefit too, provided they get their act together. I have heard of internet retailers exploring drones but I have yet to hear of one b&m retailer showing any interest. Am I uninformed?

Sorry – must dash. My coffee has just arrived from Stardrone – a subsidiary of Starbucks of course.

Stuart Bennie is a retail consultant at Impact Retailing and can be contacted at stuart@impactretailing.com.au or 0414 631 702.

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Comments

1 comment

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    Julian Josem posted on April 29, 2016

    Thanks for your regular articles Stuart, but I need to ask you - Are you in the advisory business or in the entertainment business?It's great to have someone prompt us to think innovatively, but self congratulating yourself for predicting the use of drone technology to deliver retail and intra-company packages is premature.Your prediction that drone deliveries will happen and change retail some time before the end-of-time is as meaningless as promoting concepts such as fit retailing. Whilst entertaining, is meaningless twaddle in my opinion.I value your articles on industry developments - keep them coming please. I hope we will see more on short & medium-term issues. Your wide experience shows through when you apply your first-hand knowledge to the current environment. Leave the 20-year outlooks for your grand-kids to manage! reply

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