Supply Chain weekly wrap-up: 7/29/16 – 8/4/16

Project Wing takes flight

The U.S. Federal Aviation Administration (FAA) announced on Tuesday it will allow Alphabet’s Project Wing to use one of its test sites. They will only be able to fly drones below 400 feet, but this will be the largest test of commercial drones so far. This is a step forward for the drone industry in the U.S. after Amazon had to resort to testing drones in the UK. Amazon’s goal is to be able to safely deliver parcels in 30 minutes and reach those living in rural areas who typically need to wait longer to receive deliveries. However, Project Wing is looking into a different approach. Since Alphabet’s drones are able to carry heavier items, it is exploring business to business rather than business to consumer deliveries.

The introduction of drones could create many questions and headaches for supply chain and logistics processes, changing the way businesses operate to conform to this new technology. This may be something to consider in the near future since Dave Vos, Project Wing’s director, expects to have the drone program functioning by 2017. However much will depend on the FAA’s willingness to allow such practices to take place.

Get some more details here.

Uber-investment for mapping technology & data

This weekend, The Financial Times announced Uber will be investing $500 million into their mapping technology and data. This comes after complications with the use of google maps. In non-western countries google maps are limited, meaning drawbacks for Uber and their customers. In addition, Google has raised its fees, urging Uber to invest in their own mapping system. With this investment, Uber can obtain more precise pickup and drop-off locations, as well as up-to-date traffic patterns.

Working on this technology is one of Google’s former maps engineers, Brian McClendon. Work has already begun after mapping U.S. roads last year with plans to do the same in Mexico and further expand to other countries in the coming years. Uber has already created partnerships with navigation systems such as Tom Tom and Digital Globe. This is an investment which was a long time coming with Uber’s ultimate goal of driverless cars, something which can only be possible with specific and intuitive technology. Uber’s dependence on google maps seems to be deterring them from achieving this goal, so an investment of this size is definitely a big step in the right direction.

Read more here.

Next stop: E-commerce!

Walmart is now rumored to be in talks to acquire Jet.com. This has the potential to vastly improve Walmart’s e-commerce, which has been declining due to ever-growing competition from Amazon. The acquisition could potentially give Walmart access to an innovative pricing software, a network of warehouses as well as customer data. Walmart will then have the opportunity to more successfully rival Amazon and create a bigger online presence.

Jet.com was created to rival Amazon; only established a year ago, it has made many successes since. Their strategy has adapted throughout the year, firstly taking on a similar strategy to Amazon’s annual fee but at only $50. However, after only several months, this was removed in order to focus on a larger customer base.

An acquisition for as much a $3 billion could be made. This comes after Walmart’s ‘acquisition-binge’, with an excess of 15 start-ups being acquired. Now one of Walmart’s prime goals is to rapidly expand their e-commerce. They are dominating the physical market but lacking with internet sales. A slow growth this year in e-commerce has urged Walmart to invest heavily after losing customers to Amazon.

View more on the story here.

Have a great weekend!