Walmart Catches the Drone Delivery Bug

Walmart on Monday filed a request with the Federal Aviation Administration to begin deploying commercial drones to transport goods from outside vendors to its distribution centers, as well as to customers’ homes.

The company, which has been testing drones in indoor flights, wanted an exemption in order to deploy small unmanned aircraft systems, wrote Shekar Natarajan, Walmart vice president, logistics strategy, in a letter to FAA Administrator Michael Huerta. Its goal was to create a more efficient delivery system to move merchandise.

“With this application, Walmart seeks to continue its role in not only making the present distribution system more efficient, but also to conduct research and development to support the future extension of that distribution directly to customers by using UAS for deliveries to customers at Walmart facilities, as well as to consumer homes,” explained Natarajan.

Amazon’s Footsteps

Walmart’s move follows Amazon’s extensive efforts to test drones for delivery to customers. Amazon has encountered severe delivery issues during the winter holiday season in recent years, and just last month began a pilot program to test crowdsourced one-hour deliveries in Seattle, with plans to expand the program to nine additional U.S. cities.

“Walmart is basically showing up a little bit late compared with Amazon, which announced its intentions two years ago,” said Gerald Van Hoy, an analyst with the Gartner Group.

“If you’re a large retailer like Amazon or Walmart and you have enough locations and satellite locations around, then it makes sense to do something along these lines,” he told the E-Commerce Times.

Amazon first floated the idea of using drones for customer delivery in 2013; last year, in a letter filed with federal regulators, it asked the FAA for permission to deploy drones for customer delivery of products weighing less than 5 pounds — about 85 percent of the products the company delivers.

A number of companies have begun testing drone technology for commercial use, ranging from the Mayo Clinic examining drones for deployment of blood supplies to Facebook exploring drone use to deploy Internet access globally, according to Forrester Research.

Safety Concerns

A major stumbling block for drone use is the federal government’s need to ensure safety of commercial airline flights, and to prevent security threats and accidents from affecting the general public on the ground.

The DoT earlier this month created a task force to examine the use of hobbyist drones, which have popped up near commercial airports across the country and disrupted air travel. Concerns about safety and public security, a lack of standardized aviation software, and other deficiencies in the system have forced many private companies to carry out their tests of drone technology overseas.

Walmart Initiatives

Walmart has been testing various delivery options, including drone technology, for many months, and it plans to launch additional testing and deployment options once it gains FAA approval for commercial drone exemption.

“An additional unique point on this subject is that there is a Walmart within five miles of 70 percent of the U.S. population,” Walmart spokesperson Brian Nick told the E-Commerce Times.

Documents filed with Monday’s letter show that Walmart is considering testing drones over regional distribution centers, grocery delivery sites and eventually customer homes. The drones would fly below 400 feet.

David Jones is a freelance writer based in Essex County, New Jersey. He has written for Reuters, Bloomberg, Crain's New York Business and The New York Times.

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