How autonomous delivery vehicles could impact online grocery sooner than expected

Pickup and delivery have experienced strong growth in the last year, but delivery’s significance in a retailer’s fulfillment strategy and dynamics could look very different in the not-so-distant future. The change will be driven by reduced delivery costs from the use of robots and autonomous vehicles – because when it doesn’t cost a lot more, many customers prefer delivery.

More than half a dozen autonomous delivery innovations are in pilots or already at work in various countries around the world, they take different approaches to solving the last-mile problem for products including grocery.

• Autonomous Robotics vs Vehicle. Robotics like Amazon Scout , Eliport and Fedex's Roxo are small enough to travel on the sidewalk. Larger autonomous vehicles like Nuro , AutoX , and Robomart are required to travel on city streets.
• There’s also a difference when it comes to inherent safety. The robots move at walking speed, while the larger vehicles run at 20 to 25 mph; some are fully autonomous, while others are driven “remotely.”

One of these approaches stands out because it doesn't need need a person to accept the delivery. Eliport can be loaded without human involvement, and upon arriving at the destination, it can transfer the products to a locker without any human involvement (see video below).

BMC POV

While it will be some time before a significant portion of grocery deliveries are made by autonomous vehicles, there are several good reasons to expect the shift will be faster than many now expect.

• Even with their limited range, these vehicles can serve all the customers in the primary trading area of many supermarkets.
• The majority of autonomous vehicles are environmentally friendly, i.e., they are electric powered and eliminate many “trips to the store.”
• Most important, retailers need to find ways to make their online business profitable, and this is a way to significantly remove labor costs.

The growth of autonomous grocery delivery vehicles will also be driven by competitive pressure from companies like Amazon, which has prioritized delivery in its Prime program and in the growth of its Amazon Fresh initiative.

Bottom line, grocers will need to find a way to match this capability or let Amazon dominate this increasingly important segment of the business.