Victoria Kickham started her career as a newspaper reporter in the Boston area before moving into B2B journalism. She has covered manufacturing, distribution and supply chain issues for a variety of publications in the industrial and electronics sectors, and now writes about everything from forklift batteries to omnichannel business trends for DC Velocity.
Research, development, and testing of large-cargo aerial drones—those capable of carrying more than just a few pounds of freight—continues around the world, but one European company is close to making commercial delivery operations a reality.
Cargo drone airline Dronamics will provide remotely controlled drone deliveries with its Cessna-sized Black Swan aircraft for Qatar Airways Cargo, in a partnership the companies announced late last year. The deal expands the reach of both airlines and furthers Dronamics’ goal of providing middle-mile logistics service that company leaders say not only speeds delivery and reduces costs but also gives remote and underserved locations around the world access to more frequent deliveries.
“[We] connect smaller places that may not have direct transport links,” says Severina Grozeva, global communications director for London-based Dronamics, which was founded by two brothers from Bulgaria in 2014 and maintains offices in the country’s capital, Sofia. Grozeva explains that the drones can land in small, unpaved areas that are unreachable by larger aircraft. “[The drones] will land at a small airport, regional airport, airfields. Eventually, we have plans for them to land near [warehouses] and manufacturing facilities.”
She adds that the drones can get a “meaningful” amount of cargo to remote locations for subsequent delivery to homes and businesses, explaining that the middle-mile drones deliver cargo “close to the business and close to the consumer, but not in your backyard.”
Dronamics expects to begin delivering for Qatar Airways Cargo later this year—first in Greece, where they will connect Athens with customers in the country’s northern industrial area as well as the islands in the south.
COVERING MORE DISTANCE
To date, most of the headway in drone delivery has been made in last-mile logistics, delivering small orders of retail merchandise or medicine to customers’ homes. Walmart has made strides in this area, announcing in January an expansion of its drone delivery program in Texas; the service will reach nearly 2 million households in the Dallas-Fort Worth area by the end of this year. Last-mile drones have also gotten traction in health care, delivering medicines, blood samples, and vaccines to medical facilities around the world. Autonomous delivery company Ziplineexpanded its work in that area in February, in a partnership with WellSpan Health in Pennsylvania. In both cases, the solutions offer small autonomous or remotely controlled airborne vehicles capable of delivering a few pounds of cargo up to a few hundred miles.
Dronamics’ planned service is different in size and scope. The Black Swan middle-mile drone can deliver 770 pounds of cargo up to 1,550 miles. Its fuselage is maximized for freight—it has no cockpit, giving the drone a maximum storage capacity of 125 cubic feet. Essentially, it holds about the same amount as a small delivery van, Grozeva explains. Technicians control the drones via a remote cockpit. The system requires a short runway for takeoff and landing, about 1,300 feet—paved or not. The idea is that the service will eliminate the need to use multiple trucks and vans to transport freight, replacing them with a service that can get the cargo closer to the consumer, faster.
Dronamics says its drones can deliver cargo up to 80% faster, 50% cheaper, and with up to 60% lower emissions than traditional modes of transportation, including air freight. The Black Swan runs on a conventional engine, but its frame and size help make it more fuel-efficient, Grozeva says, adding that the company is working toward using sustainable fuels, including biofuel, hydrogen, and synthetic-based formulations.
The company has been testing its drones for a few years and launched its first full-scale flight in 2023. Early customers include freight forwarders and logistics service providers— Germany’s Hellmann Worldwide Logistics and global package delivery service DHL are two examples—but Grozeva says Dronamics also plans to work directly with companies and brands that move large volumes of cargo. The agreement with Qatar Airways Cargo is its first partnership with an international airline—and Dronamics claims it’s an industry first as well.
DEMOCRATIZING DELIVERY
Air freight represents a small portion of the total cargo moved around the world annually, but leaders at Dronamics say middle-mile cargo drones will help broaden that market. On top of that, they say middle-mile drones can bring next-day delivery to more people in more places around the world, which will benefit those in less-developed regions as well as those in remote areas—like the Greek islands, where many businesses and consumers receive only weekly deliveries of essential goods, via ferry, much of the year.
“There are a lot of geographies like that,” Grozeva explains. “People say to us, ‘This is a great solution for the less-developed world’ … but there is a lot of opportunity in the developed world as well.”
Dronamics refers to its business proposition as “enabling same-day delivery to everyone, everywhere.”
Although Dronamics’ work has focused on Europe to date, the company is currently testing its service through a DHL partnership in Australia and eventually plans to break into the U.S. market.
Market trends may help make those goals a reality. The delivery drone market is expected to grow considerably over the next several years, by some estimates reaching a compound annual growth rate (CAGR) of around 40% by 2030—driven largely by demand for faster, more sustainable delivery as well as advances in drone technology. Small, last-mile delivery drones will make up the bulk of the growth, but drones that can transport heavier loads are making strides as well. A 2023 report from Allied Market Research points to the integration of cargo drones into middle-mile logistics as a key trend moving forward.
“Improvements in battery technology, sensors, machine learning algorithms, and materials have enhanced the capability of cargo drones,” according to the report. “With longer flight times, heavier payloads, and greater autonomy, cargo drones have become more efficient and effective than traditional delivery methods.”
Leaders at Dronamics agree.
“[This is] still considered a niche market,” Grozeva says, emphasizing the long-term potential of middle-mile drones. “But it’s interesting in terms of what it can do to help businesses become more competitive.”
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."
Businesses are cautiously optimistic as peak holiday shipping season draws near, with many anticipating year-over-year sales increases as they continue to battle challenging supply chain conditions.
That’s according to the DHL 2024 Peak Season Shipping Survey, released today by express shipping service provider DHL Express U.S. The company surveyed small and medium-sized enterprises (SMEs) to gauge their holiday business outlook compared to last year and found that a mix of optimism and “strategic caution” prevail ahead of this year’s peak.
Nearly half (48%) of the SMEs surveyed said they expect higher holiday sales compared to 2023, while 44% said they expect sales to remain on par with last year, and just 8% said they foresee a decline. Respondents said the main challenges to hitting those goals are supply chain problems (35%), inflation and fluctuating consumer demand (34%), staffing (16%), and inventory challenges (14%).
But respondents said they have strategies in place to tackle those issues. Many said they began preparing for holiday season earlier this year—with 45% saying they started planning in Q2 or earlier, up from 39% last year. Other strategies include expanding into international markets (35%) and leveraging holiday discounts (32%).
Sixty percent of respondents said they will prioritize personalized customer service as a way to enhance customer interactions and loyalty this year. Still others said they will invest in enhanced web and mobile experiences (23%) and eco-friendly practices (13%) to draw customers this holiday season.
That challenge is one of the reasons that fewer shoppers overall are satisfied with their shopping experiences lately, Lincolnshire, Illinois-based Zebra said in its “17th Annual Global Shopper Study.”th Annual Global Shopper Study.” While 85% of shoppers last year were satisfied with both the in-store and online experiences, only 81% in 2024 are satisfied with the in-store experience and just 79% with online shopping.
In response, most retailers (78%) say they are investing in technology tools that can help both frontline workers and those watching operations from behind the scenes to minimize theft and loss, Zebra said.
Just 38% of retailers currently use AI-based prescriptive analytics for loss prevention, but a much larger 50% say they plan to use it in the next 1-3 years. That was followed by self-checkout cameras and sensors (45%), computer vision (46%), and RFID tags and readers (42%) that are planned for use within the next three years, specifically for loss prevention.
Those strategies could help improve the brick and mortar shopping experience, since 78% of shoppers say it’s annoying when products are locked up or secured within cases. Adding to that frustration is that it’s hard to find an associate while shopping in stores these days, according to 70% of consumers. In response, some just walk out; one in five shoppers has left a store without getting what they needed because a retail associate wasn’t available to help, an increase over the past two years.
The survey also identified additional frustrations faced by retailers and associates:
challenges with offering easy options for click-and-collect or returns, despite high shopper demand for them
the struggle to confirm current inventory and pricing
lingering labor shortages and increasing loss incidents, even as shoppers return to stores
“Many retailers are laying the groundwork to build a modern store experience,” Matt Guiste, Global Retail Technology Strategist, Zebra Technologies, said in a release. “They are investing in mobile and intelligent automation technologies to help inform operational decisions and enable associates to do the things that keep shoppers happy.”
The survey was administered online by Azure Knowledge Corporation and included 4,200 adult shoppers (age 18+), decision-makers, and associates, who replied to questions about the topics of shopper experience, device and technology usage, and delivery and fulfillment in store and online.
An eight-year veteran of the Georgia company, Hakala will begin his new role on January 1, when the current CEO, Tero Peltomäki, will retire after a long and noteworthy career, continuing as a member of the board of directors, Cimcorp said.
According to Hakala, automation is an inevitable course in Cimcorp’s core sectors, and the company’s end-to-end capabilities will be crucial for clients’ success. In the past, both the tire and grocery retail industries have automated individual machines and parts of their operations. In recent years, automation has spread throughout the facilities, as companies want to be able to see their entire operation with one look, utilize analytics, optimize processes, and lead with data.
“Cimcorp has always grown by starting small in the new business segments. We’ve created one solution first, and as we’ve gained more knowledge of our clients’ challenges, we have been able to expand,” Hakala said in a release. “In every phase, we aim to bring our experience to the table and even challenge the client’s initial perspective. We are interested in what our client does and how it could be done better and more efficiently.”
Although many shoppers will
return to physical stores this holiday season, online shopping remains a driving force behind peak-season shipping challenges, especially when it comes to the last mile. Consumers still want fast, free shipping if they can get it—without any delays or disruptions to their holiday deliveries.
One disruptor that gets a lot of headlines this time of year is package theft—committed by so-called “porch pirates.” These are thieves who snatch parcels from front stairs, side porches, and driveways in neighborhoods across the country. The problem adds up to billions of dollars in stolen merchandise each year—not to mention headaches for shippers, parcel delivery companies, and, of course, consumers.
Given the scope of the problem, it’s no wonder online shoppers are worried about it—especially during holiday season. In its annual report on package theft trends, released in October, the
security-focused research and product review firm Security.org found that:
17% of Americans had a package stolen in the past three months, with the typical stolen parcel worth about $50. Some 44% said they’d had a package taken at some point in their life.
Package thieves poached more than $8 billion in merchandise over the past year.
18% of adults said they’d had a package stolen that contained a gift for someone else.
Ahead of the holiday season, 88% of adults said they were worried about theft of online purchases, with more than a quarter saying they were “extremely” or “very” concerned.
But it doesn’t have to be that way. There are some low-tech steps consumers can take to help guard against porch piracy along with some high-tech logistics-focused innovations in the pipeline that can protect deliveries in the last mile. First, some common-sense advice on avoiding package theft from the Security.org research:
Install a doorbell camera, which is a relatively low-cost deterrent.
Bring packages inside promptly or arrange to have them delivered to a secure location if no one will be at home.
Consider using click-and-collect options when possible.
If the retailer allows you to specify delivery-time windows, consider doing so to avoid having packages sit outside for extended periods.
These steps may sound basic, but they are by no means a given: Fewer than half of Americans consider the timing of deliveries, less than a third have a doorbell camera, and nearly one-fifth take no precautions to prevent package theft, according to the research.
Tech vendors are stepping up to help. One example is
Arrive AI, which develops smart mailboxes for last-mile delivery and pickup. The company says its Mailbox-as-a-Service (MaaS) platform will revolutionize the last mile by building a network of parcel-storage boxes that can be accessed by people, drones, or robots. In a nutshell: Packages are placed into a weatherproof box via drone, robot, driverless carrier, or traditional delivery method—and no one other than the rightful owner can access it.
Although the platform is still in development, the company already offers solutions for business clients looking to secure high-value deliveries and sensitive shipments. The health-care industry is one example: Arrive AI offers secure drone delivery of medical supplies, prescriptions, lab samples, and the like to hospitals and other health-care facilities. The platform provides real-time tracking, chain-of-custody controls, and theft-prevention features. Arrive is conducting short-term deployments between logistics companies and health-care partners now, according to a company spokesperson.
The MaaS solution has a pretty high cool factor. And the common-sense best practices just seem like solid advice. Maybe combining both is the key to a more secure last mile—during peak shipping season and throughout the year as well.