3 reasons to implement delivery robots into your last-mile delivery strategy

Delivery robots

The COVID-19 pandemic has challenged companies and customers to adapt to new realities. For companies, the virus has pushed executives to rethink most aspects of their business model to accommodate trends and consumer behavior. On the customer-facing side, the extended lockdown periods proved that shoppers modified their spending habits and revealed the growing popularity of online shopping and home deliveries. Consumers expect fast, reliable, safe purchasing experiences in the new normal, and businesses must cater to these new expectations. Thus, both corporates and smaller business are at a crossroads for incorporating new technologies to fight the effects of the virus and increase their overall competitiveness at the same time. Many of these new strategies focus on last-mile delivery.

One of the newest and more stylish solutions in last-mile delivery are delivery robots. Delivery robots have made quite a splash after the pandemic, especially as demand for food delivery grows. And, contrary to what might be expected, delivery robots have become increasingly affordable, autonomous, and represent an invaluable opportunity for any firm wanting to take its business strategy to the next level. Delivery robots can be the perfect solution for distribution challenges regardless of the company size, operation type, and customer base. Why? Here, we present you three reasons to implement delivery robots into your company today:

1. The solution to labor shortages

The integration of delivery robots into a firm’s distribution strategy can alleviate the effects of a global labor shortage that has no end in sight. Following extended lockdown periods, companies’ pain points revolve around operational capacity. However, reaching pre-pandemic efficiency has not been an easy task in some industries. Labor shortages have puzzled managers to seek new alternatives to reach full operating capacity in the last few months. In this context, companies are now choosing automation to resolve their most urgent issues in last-mile delivery.

Therefore, delivery robots represent the perfect complement to human deliveries, as they close the labor gap required to fulfill ever-growing home deliveries. Their flexibility, easy handling and scalability have made them an attractive option for food delivery platforms, restaurant chains and supermarkets, which saw higher demand for autonomous delivery robots during 2020. It is not hard to see why:

• Companies do not require complex operational training to kick-start their robot deliveries. The robots are designed for ease of operation in fast-paced environments. It is as simple as preparing an order, loading it into the robot and waving goodbye.

• Autonomous delivery robots can operate on a 24-hour delivery basis once they have reached full autonomy, requiring intervention from operators only while performing certain maneuvers at intersections or crossroads.

• A delivery robot allows any firm to keep track of all their orders through the seamless integration of previous CMS or order system through the robot’s APIs and SDKs. In this way, companies are not spreading themselves too thin when it comes to delivery.

In addition, delivery robots have proven to be a pandemic-proof option, which also guarantees contactless deliveries.

2. Increased value at lower prices

Delivery in COVID times has proven to be rewarding but also challenging. Supermarkets, restaurants, and retail stores began overhauling their delivery strategies to keep up with consumers’ demands during lockdown periods. Some opted to launch their in-house delivery solutions or extend their offering into other delivery platforms to cope with growing orders from homebound customers with plenty of free time and money to spend. With a plethora of options available in the market, implementing third-party delivery solutions might seem like the obvious alternative. However, employing such companies bring additional costs. The prices for the customer include fees that keep stacking up, in some cases adding markups of 7% up to 90% for food deliveries. These hefty amounts of fees might end up discouraging clients who desire faster home deliveries but remain highly price sensitive.

Therefore, in the face of rising pricing schemes for last-mile distribution, delivery robots ensure a modern, hygienic, automatized alternative for transporting goods at a lower cost. Delivery robots add value to last-mile delivery by introducing customers to a new and exciting approach to receiving their goods. Customers place their orders from their smartphone and receive their favorite dishes or groceries directly from an autonomous robot, which initially are remotely operated. In times where sanitation and contactless interactions are a requirement for the sake of public health, delivery robots represent the apparent solution for the future of delivery.

Moreover, these autonomous robots require a minimal capital investment that guarantees lower distribution costs when compared to the salary of a full-time delivery employee. Fulfillment costs could go to 2 euros per delivery or lower. As robots achieve full autonomy, it allows the company to expand its robot fleet and operate several delivery robots with minimum supervision, which enlarges the number of deliveries and improves unit economics, as shown in Figure 1.

Figure 1. The eventual autonomy of the delivery robot rely on the efficient handling of sensor data at the edge, which feed the AI algorithms that trains the delivery robot to achieve greater autonomy over time.

Figure 1. The eventual autonomy of the delivery robot rely on the efficient handling of sensor data at the edge, which feed the AI algorithms that trains the delivery robot to achieve greater autonomy over time.

3. Eye-catching branding

The delivery robot market is expected to keep increasing in the forthcoming years. To some estimates, 85% of last-mile deliveries will be performed using autonomous vehicles. Considering the number of autonomous delivery robots filling up sidewalks and bike lanes in the near future, one should look to the branding potential these robots have. Delivery robots represent a unique opportunity to elevate any brand to new heights of out-of-home advertising. By customizing delivery robots, this eye-catching, moving robot will be seen thousands of customers per day, turning looks at every block. Unlike other traditional advertising methods, a delivery robot will never go unnoticed. Besides, considering the exorbitant prices of production and rental of outdoor advertising space, a delivery robot imprinted with your brand colors and logos will bring a higher return on investment.

Figure 2. Picture with illustrative purposes.

Figure 2. Picture with illustrative purposes.

Bonus - Environmentally friendly

Another reason to implement delivery robots into your distribution strategy is their low carbon footprint compared to other traditional delivery methods. As they drive through the sidewalks, delivery robots can take other more polluting delivery methods out of the streets and reduce energy consumption and CO2 emissions in urban areas.

The future of delivery, today

With every new technology comes an initial resistance to embrace the disruptions it brings. There is even a classification for those who decide to innovate and adopt the technology during the early stages and those who lag behind. In the case of delivery robots, the market is now mature and every day more organizations decide to complement their delivery strategies with autonomous delivery robots. Regardless of business type, customer base or available resources, the incorporation of delivery robots into any delivery strategy will support managers and business owners to create value, reduce costs, improve efficiency, and enhance their brand (while being environmentally responsible). In the long run, it is just a matter of time until the widespread adoption of autonomous delivery robots becomes the norm.

At Teraki, we have worked extensively for more than six years hand in hand with automotive and semiconductor companies to develop autonomous driving systems through the efficient collection and processing of sensor data at the edge. Today, we have leveraged all that know-how to offer our customers genuinely autonomous delivery robots tailored to the realities of their business and geographic locations. At Teraki, we believe that the future of delivery is today.

Contact us at info@teraki.com to learn more about our delivery robots and start your autonomous journey today.

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