Technology and innovation are indispensable with the increased competition of business entities globally. Consequently, companies are embracing different innovative technologies in a bid to gain competitive advantage. The use of drones in business endeavors is one such technology. Pundits argue that drones, also referred to as unmanned aerial vehicles (UAVs), have the potential to become game changers in the business world. This is highly likely given the increased popularity of drones in the recent years. For example, in the 12-month duration ending April 2016, the percentage of drone sale rose by 224% compared to the previous year grossing at $200 million. This figure shows that drones are becoming popular in a wide variety of industries and sectors. Drones can influence various aspects of a business operation. This essay is aimed at exploring how the use of drones will affect inventory management and logistics/stock-outs in business enterprises.
Amazon is one of the most notable companies that have incorporated the use of drones in their business operations. Through Amazon Prime Air, the company seeks to reinvent its delivery service. The company plans to deliver packages to customers within thirty minutes or less using drones. Thus, use of drones will help enhance parcel delivery by making it more rapid. Besides this, Amazon hopes to make its transportation system safe and efficient. This implies that the firm will be capable of deploying packages from its warehouses to the customers faster than it has been doing previously. Undoubtedly, this will have a profound impact on its inventory management and logistics/ stock outs. Commercial use of drones is bound to affect a company's inventory management in several ways. Firstly, it will result in the automation of the process. This will fuel an unprecedented shift in the warehouse workforces. Companies have to automate their inventory to operationalize the use of drones. This would imply that once an order is received, the goods are immediately prepared for shipment. Employees would need to work both smarter and faster to keep up with drones. As a result, as opposed to printing picking lists, firms would be expected to make profound improvements to their picking, packing and shipping processes. They also would require them to use mobile technology and well-defined maps in guiding their employees through the process of picking. Other notable improvements to the inventory system would be the use of inventory management software amongst other advanced technologies.
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The use of drones may also affect a company’s supply chain. Due to shortened shipping times, companies would be required to make sure that products reach their warehouses much faster. This is aimed at ensuring that there are no stock-outs. Likewise, the distributors would be needed to work more closely with local suppliers as opposed to relying solely on a central hub for delivery of goods. Through this approach, the distributors would become more flexible, particularly in their response to shortages. This strategy would be a good starting point for eliminating shortages. Nevertheless, it would be difficult for companies to find the right inventory balance. This is mainly due to the reduced warning time. Consequently, companies are likely to overstock in a bid to avoid stock-outs. The firms would need to rely on and invest heavily in sales data to counter this. This would be aimed at ensuring that the firms can identify trends and find areas needing improvement in their supply chains and order fulfillment.
Through the use of drones, warehouses can better coordinate and update their inventory management database. For instance, heavy duty drones can be used to transport packages from one warehouse to another. This would ensure that a company can meet both local and regional demand without over-relying on trucking. On the other hand, drones fitted with barcode scanners can be used in the warehouses to scan barcodes on products and shelves. In doing this, the drones would aid in updating the inventory database within a short period compared to humans and informing the company when the supply is running low. This would also help the company in determining whether the supply has over-stayed in the warehouse, in which case its quality would be an issue of concern. Another notable area of contribution is customer claims and returns. In this case, when a client is dissatisfied with an item, he or she may no longer need to send the item back via courier services or request for a truck to pick it at his or her home. Instead, a drone will be dispatched to the customer's home to pick the product. Heavy duty drones can also be used by retailers to ferry entire damaged pallets.
Competition is inevitable in the future of business, particularly with globalization. Thus, the use of drones is expected to intensify. Adoption and use of drones will revolutionize not only warehouses but also entire businesses. Thus, it would be prudent for business entities to embrace this innovation to enhance their inventory management and logistics. Currently, the widespread use of drones is limited by lack of clarity in their regulations, permits and licensing. However, as the drone industry and its regulation mature, the use of UAVs will become an integral part of business operations across industries and sectors. Moreover, with the emergence of numerous drone makers, the prices of drones are likely to fall as the technology used advances. When this happens, affordability and utility of drones will be significantly addressed, resulting in an extensive use of drones in business.
