4 Places that Drones May Invade the Supply Chain

The United States moved closer to legalizing the commercial use of drones in February, when the U.S. Federal Aviation Administration (FAA) published proposed regulations. Although some criticized the rules as too restrictive (for example, drones would have to fly only during daylight and within sight of the operator), there is plenty of time for the FAA to change the regulations before they become final, in one to two years.

But regardless of the FAA, drones are already being used commercially, both in the U.S. – where it is still technically illegal – and around the world, where it may or may not be. Indeed, Colin Snow, founder and CEO of the Drone Analyst, estimates that there are already 2,000 to 3,000 illegal operators representing economic activity of $200 million to $350 million in the United States.

Drone vendors say that most Fortune 500 companies are investigating how they can use small drones, or unmanned aerial vehicles (UAVs), in their operations.  Delivery is an obvious application.  Both Google and Amazon Prime Air have tested drones for making deliveries. In fact, Google bought a drone company – Titan Aerospace – last year. And it's not hard to imagine how drones might help move small goods (such as electronics components) within a factory or warehouse. 

Here are some not-quite-so-obvious applications for the supply chain:

Asset monitoring :  Drones are used in agriculture and mining to observe and monitor things. With the right sensors and software, UAVs can record images of fields over time to show farmers how well (or not) crops are growing, or to monitor the moisture and pH levels of the soil, for example. In mining, UAVs are being used help direct operators of mining equipment. While technically such applications could previously be done by helicopter, the combination of cheap drones, wireless communications, and data analysis software is making it much easier and much less expensive. At least one company is already focusing on such applications for the supply chain. PINC Air says its drones can help manufacturers keep accurate and timely inventory records by keeping a count of goods in crowded areas or in highly dispersed areas. “PINC Air provides the ability to efficiently and effectively survey a wide area to autonomously locate and inventory assets,” said the company.

Logistics with a capital “L” : Although the focus today is on small drones, imagine if companies employed large UAVs, rather than cargo ships, manned airplanes, railroads and trucks, to pick up electronics components from one spot in Asia, deliver them directly to a contract manufacturer at another location, and then even deliver the finished products to OEMs or distributors around the world. There is big potential here for reducing costs and speeding time to market.

Industrial espionage : Who wouldn't like to get a look at the goods moving in and out of a competitor's factory or distribution center? While big, noisy helicopters are bound to attract attention, tiny drones with cameras could potentially hover and shoot video unnoticed. For example, take a look at this footage taken by a hobbyist's drone of the new Apple campus being built in Cupertino. In the United States, at least, this sort of activity is legal because the air above a commercial enterprise is usually considered public space.

Warehouse security/theft prevention : On the flip side, drones can be silent watchdogs, monitoring your facilities for theft or disasters. In South Africa, AirShepherd is using drones to catch wildlife poachers in Hluhluwe Imfolozi Park.

 Rather than fly their own drones and analyze the data, companies will turn to new breed of businesses that offer “drones as a service.” Just starting to emerge, these companies provide the drone and whatever sensors the application requires (cameras, gas detectors, thermal imaging, whatever), fly the drone and gather the data, download the data to their servers, analyze it however the customer wants, and then deliver the information to the customer.  With service providers taking on the overhead and the legal liability, if there is any, the use of drones for all sorts of applications could explode.

So next time you hear a buzz from above, look closely. It might just be a drone.

What applications do you foresee for drones in the electronics supply chain? Let us know in the comments section below.

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