The rise of ecommerce has truly shrunk supply chain timelines, speeding up consumer expectations in its wake. Deliveries to a consumer’s door that took a week a decade ago take only two days today, courtesy of the tight delivery schedules that have now become the norm.
Chinese ecommerce behemoth JD.com is turning delivery schedules up a notch by introducing delivery drones in Indonesia and completing its first “government approved” drone delivery earlier this month.
“The test flight took place on January 8, 2019, in West Java, Indonesia, where the drone flew from Jagabita Village, Parung Panjang to MIS Nurul Falah Leles Elementary School to deliver backpacks and books to students. The items delivered by drone were part of a larger donation of supplies from JD.com to the school,” said JD.com in a statement released today.
Because of consumer demand, the logistics industry meets difficult last-mile delivery schedules of next-day and even same-day when necessary. Businesses realize the significance of delivery timeframes for consumer retention and brand loyalty. Expectations drive results; companies are working under ever-tighter schedules, or lose market share to others who do.
Though Amazon pioneered many innovative techniques at both the warehouse level and the last-mile stretch, JD.com has been busy with automating lynchpin nodes along its supply chain to expedite cargo movement. For instance, the company runs an automated warehouse in Kunshan, China, that is entirely managed by a swarm of robots. The warehouse can handle 200,000 orders a day and employs only four people – whose role is to service the robots.
JD.com banks on a robust last-mile delivery system in China, allowing it to deliver goods on the same day they are ordered – even to the remotest corner of the country. The only requirement that JD.com sets to ensure same-day delivery is that it receives the order before 11:00 a.m. To keep up the delivery pace and to expand its range beyond the reach of last-mile delivery vans, the company oversees an armada of delivery drones that have been in use for the past couple of years.
JD.com’s foray into Indonesia should arouse considerable interest, as the country presents the challenges of a large population and a unique terrain. Indonesia is the world’s largest archipelago; 260 million Indonesians live across 17,000 islands. This makes it difficult for last-mile logistics companies to deliver by road; not all the islands are well connected by bridges. Drone delivery could be a perfect fit, as it not only negates the need for expensive infrastructure to be in place for movement, but also drastically cuts down delivery times.
To bring high-quality e-commerce to Indonesia, JD.com has partnered with JD.id, its Indonesian counterpart. Since its launch in 2016, JD.id has grown rapidly, serving 20 million consumers across the country, delivering in 483 cities and 6,500 counties. JD.id has set some ambitious goals relating to delivery times, looking to fulfill 85 percent of its orders either on the same day as an order or the next day. Adding delivery drones to its last-mile fleet would go a long way to achieving its target.
Last year, JD.com unveiled its first unmanned store in Indonesia (and incidentally its first such store outside of China). Called X-Mart, the brick-and-mortar storefront is similar to Amazon Go stores in the U.S. Customers walk in, pick items off the shelf, and leave the store without waiting in checkout lanes to bill the products. The AI-powered store will automatically add the selected items to customers’ accounts, letting them pay for them through their JD.com accounts.
Revamping the way ecommerce works is critical to gaining favor among consumers and to repeatedly earn their business. Like Amazon and Alibaba, JD.com is constantly innovating and disrupting its supply chain to hold its place in its heavily contested markets. Its involvement in drone delivery is in-line with those ambitions.