Abstract
Drone delivery services (DDS) are an upcoming reality. Companies such as Amazon, DHL and Google are investing in developments in this area. German’s parcel delivery company DHL has begun applying them commercially. This emphasises the importance to have insights in the economic benefits of drone delivery services. This study compares drone delivery services with traditional delivery services. It looks at the cost effectiveness of integrating drones into a delivery services’ operations. The study identifies and categorise factors that control the delivery operations. It develops a mathematical model that compares 3D flight paths of a fleet of drones with a fleet of 2D van routes. The developed method can be seen as an extension of the Vehicle Routing Problem (VRP). Efficiency savings of drone services of real world rural postcode sectors are analysed. The study limits itself to the use of small unmanned aerial vehicles (UAVs) with a low payload, which are GPS controlled and autonomous. The case study shows time, distance and cost savings when using drones rather than delivery vans. The model reveals efficiency factors to operate DDS. The study shows the economic necessity for delivering low weight goods via DDS. The primary methodological novelty of this study is a model that integrates factors relevant to drones into the VRP.