Business

The tech revolution within the last mile of cold chain

Spoiler alert: a success story where new technologies make cold chain & pharmaceutical chain more sustainable, effective and even save lives. 

When handling perishable goods – food, medicines and biomedical material, time is your worst enemy. 

That is why the shorter the supply chain is, and the smaller the physical distance between the producer/retailer and the consumer, the fewer goods are lost, and the more effective the medical help may be.

But most of the time it is not possible to produce and sell food, medicines and other produce locally, so the matter of time stays even more valid.

To solve this problem supply chain managers have found ways to fight with time by keeping products at the right temperatures and in the right air conditions to slow down decomposition processes during transportation and storage.

On the other hand, there are also numerous trials undertaken to speed up, optimize and cut costs of the last mile delivery of temperature-sensitive products. And it seems that we can make it even faster, cheaper and more convenient for consumers without compromising quality.

See how the last mile delivery in cold supply chain is starting to change the game and get inspired.

Refrigerated parcel lockers

The service called Lodówkomat (a refrigerated parcel locker) is pioneered by a well-known Polish delivery provider operating internationally – InPost

It merges the idea of outsourcing of grocery shopping with a convenient collection of the package from the refrigerated machine available 24/7/365.

The customers do not have to be at home at the delivery time and can collect their parcel on their way home at any suitable moment of the day. At the same time, the refrigerated lockers have compartments with temperatures of +16C, +4C and -18C, which enable the storage of different types of produce, including frozen food, in the right conditions.

lodowkomat

Similar solutions – but targeted more on ready-made meal deliveries to office employees – is being developed also by Sodexo in cooperation with Ricoh.

And another parcel lockers system with integrated cold storage service Smartmile has been lately launched in Finland.

6 miles in 6 minutes – using UAVs and drones in cold chain

2019 was the year of first successful trials in using drones to deliver food and medicines in the US – both within hospitals, but also between retailers and households.

The first company to receive FAA approval to conduct drone deliveries beyond the visual line of sight in the US was Flirtey. They were granted approval in March 2019, and in this respect, they managed to leave behind such giants as Amazon and Google. 

The company not only introduced its drones for delivery, but also designed custom packaging that ensures the cold and warm cargo keeps its temperature, and fragile load stays intact.

In spring 2019, Wing – a company owned by Alphabet – launched a free 10-minute trial distribution service in Europe (Finland), and in autumn 2019 their service was launched in Virginia in the US. 

Months in advance, drone delivery user experience studies and re-design were conducted in Australia, in partnership with local food & drink shops and pharmacies. The company promises:

  • very short delivery times (6 miles in 6 minutes)
  • low prices, because of the efficiency of drone delivery
  • low environmental impact, since the drones are fully electric

Pizza delivered by a robot – small autonomous vehicles for food delivery

One of the first companies to introduce pilot projects with drone company Flirtey, was Domino’s pizza. 

Despite the fact UAVs (Unmanned Aerial Vehicles) and autonomous vehicles are not yet a common technology, Domino’s policy is to experiment a lot around their use in delivery to build a competitive advantage and cut future costs. 

For example, in Europe, they partnered with Starship Technologies to test the delivery robot that rides on sidewalks. And there are more and more companies producing top delivery robots and betting their business on the future humanless delivery Kiwi, Robomart, TeleRetail, Amazon Scout, FedEx Delivery Robot.

Drugs from thin air – drones in pharmaceutical supply chain

The example set by companies introducing drones for food delivery was followed by UPS in autumn 2019. 

This time the giant logistical company launched a small drone delivery operation for another purpose – transporting medical samples within the hospital network premises on WakeMed Raleigh campus in North Carolina, US. 

Chris Cassidy, UPS President of Global Healthcare & Life Sciences Strategy, commented the launch with great optimism:

UPS Healthcare & Life Sciences is excited to expand on our current lab specimen logistics portfolio to drive a step change in today’s delivery models, using drones to bring blood and other diagnostic specimens from medical facilities to central labs will improve transport efficiencies like never before, and with fewer vehicles on the road, we’ll generate less environmental impact.

Just a month later, UPS together with CVS Health Corporation, started using drones for deliveries of prescription medicines to CVS customers households. What is more – UPS Flight ForwardTM services are being offered also in combination with truck delivery for more efficient delivery in rural areas.

Although more and more drones, other UAVs and wheeled robots pilots are introduced in food and cold chain, the technology is still far from wide commercialization. But there are already other, more powerful implementations of them, in the places where you might not expect them.

UAVs in the pharmaceutical supply chain in developing countries

While the drone race between delivery and logistics giants is a quite well-known fact, there is not enough media coverage on the far more impactful use of UAVs (not necessarily drones) for transportation of medicines, blood and vaccines in the developing countries with poor transportation infrastructure. 

One of the start-ups that bring over an agile pharmaceutical supply chain is Zipline, which has completed over 31 000 commercial deliveries of lifesaving products with electric drones in Rwanda and Tanzania. 

Zipline’s drones are independent of road quality which is vital when we consider that in Rwanda more than 80% of roads are unpaved, making most of the country inaccessible by road during the rainy season. 

Zipline not only uses its fleet of UAVs but also builds suitable distribution centers that can serve an area of 22,500+ square kilometers (8,750+ square mile) each. 

The packages are dropped with a parachute, and the small plane that is used for delivery gets safely back to the base. 

The whole process and service are developed extremely smartly – I highly recommend watching the video below.

Also, a consortium which includes Direct Relief, Merck, Softbox (creators of a payload box), AT&T and Volans-I has organized multiple pilots including the use of drones in the delivery of temperature-sensitive medicines in Switzerland, Bahamas, and Puerto Rico

They not only enabled temperature control at temperatures of as low as -70C but also managed to track it all along the way. 

Those optimistic reports are accompanied by results of the first scientific studies on using drones in the pharmaceutical supply chain, which suggest that indeed even some temperature changes and vibrations during flights are not harmful to medicines such as eg. insulin.

The limitations of tech innovations in cold chain

Whereas all the above implementations of drones are already technologically-feasible, large-scale adoption of new unmanned vehicles and robots as carriers in last mile of supply chains in the upcoming years is not a certainty. The same applies to the refrigerated parcel lockers.

There are definitely many potential pros of the above innovations:

  • better accuracy and convenience of delivery, especially if the customer changes locations
  • greater accessibility of products in rural areas – for people living outside the grid of well-developed infrastructure
  • significant shortening of the time of delivery of any package, but above all – when we consider UAVs – life-saving pharmaceuticals and food and water supplies in disaster areas
  • lower costs of delivery due to speeding it up and lower manpower costs

On the other side of the spectrum, there are still many challenges and concerns.

First of all, there are still many technical limitations for UAVs and other robots:

  • relatively low loading capacity – most existing UAVs are capable of handling cargo not heavier than ab. 1.5 kilos (ab. 3 pounds). It is better for wheeled vehicles though.
  • very limited range – due to the capacity of batteries, most of the machines can fly/drive for no longer than 15-30 minutes and then need a recharge. That is not much.
  • navigating a drone in urban areas is very difficult – most UAV proof-of-concept trials have been so far conducted in rural areas and on open spaces, and it is far more difficult to navigate a drone in areas full of physical obstacles, densely populated and highly dynamic
  • severe weather conditions make it difficult to use UAVs – they have problems to operate under eg. gusty winds, intense heat or freezing rain
  • potential catastrophic accidents can occur due to technical problems – the technology is under fast development and is not yet mature
  • common communication protocols, rules, technical standards, and requirements have to be further developed by multiple public and private stakeholders and met by drone delivery companies

Secondly – some business advantages of using these new technologies will be accompanied by disadvantages:

  • quite high insurance costs for service providers, and – in general – high costs of overall operations, because of the technical instability of drones and robots in the initial phase
  • the problem of theft of cargo and machines – if a drone does not land for delivering the package, then there is no option of ensuring the cargo got to the right hands. If drone lands or a robot stops for delivery, it can be stolen or damaged itself. And all the above-mentioned innovations, including the lockers, are also prone to cyber attacks

Finally, some societal challenges and concerns need to be addressed for the responsible use of emerging technologies in last mile delivery:

  • orchestration of drone and robot movement in public space is needed – which includes movement of UAVs within airspace shared with traditional aircraft, and of robots on the public roads
  • noise pollution may rise noticeably – especially in the cities when fleets of drones start operating
  • ensuring citizen privacy will be a challenge since drones and robots use cameras and GPS for navigation and environment monitoring. Some citizens, neighborhoods and municipalities may restrict their property and areas as drone-free and robot-free
  • public security concernsas stated by Bob Lieb, while we prefer not to think about it much, we have to be aware that it may be very easy eg. for terrorists or criminals to build a drone or a robot that mimics a delivery machine and use it for criminal and potentially deadly purposes. It might also be very difficult to control cargos that are shipped by autonomous delivery machines or stored in different types of delivery lockers.

To sum up – the innovation in last mile delivery in cold chain and pharma supply chain is definitely on its way, but we still need to understand the consequences and prepare for it well as a society. 

While delivery convenience is king in 2020, we still have to decide under what circumstances it is worth more than our safety, privacy and peaceful environment.

If you are interested in other uses of drones and UAVs in business and want to learn more about the system we developed for a franchise of drone services, check our Pix4d case study.

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