The world’s first fully autonomous drone delivery service launched in Reykjavik, Iceland this week, with online marketplace AHA partnering with drone company Flytrex to deliver food and products on demand across the capital city.

Food delivery has soared due to online ordering, according to a video posted by Flytrex. But in Reykjavik, delivery can take up to 25 minutes due to the city’s landscape, which includes a wide river running through it. The drone delivery service–the first ever deployed in an urban environment–can cut down delivery time to just four minutes, with a 60% reduction per delivery cost, Flytrex said.

“If we think about what the future of retail will look like, shops will still exist, but I think the delivery infrastructure will totally change shopping as we know it today,” said Maron Kristófersson, CEO at AHA, in a video announcement.

AHA does deliveries for more than 100 stores, restaurants, and grocery stores every day of the week. “We started looking into new technology for deliveries in 2014, and quickly realized drones were a viable option,” Kristófersson said in the video. To deliver something from point A to point B might only be 2 km by air, but 7 km by car, he added. For that particular route, drone delivery can save 20 minutes of work per delivery, as well as salary costs for the company, Kristófersson said.

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Flytrex’s system will operate alongside AHA’s existing vehicle-based delivery network, increasing its daily delivery capacity, without increasing manpower, according to the Flytrex website.

“Now that we’ve seen the system in operation, I realize the most important part is aviation safety and autonomous control of the drone,” Kristófersson said in the video. “It allows us to use different drones for different products or delivery services.”

The drones can carry packages that weigh up to 3 kg, and are slightly larger than a shoebox, TechCrunch reported. As a start, Flytrex will fly one drone that will make 20 deliveries per day, before adding more in the coming weeks. The ultimate goal is to make hundreds of deliveries per day, directly to customer’s yards.

Several companies have experimented with drone delivery in recent months. UPS recently tested autonomous drone delivery for its packages, and last year, Domino’s successfully completed the delivery of a pizza to a customer in New Zealand via drone.

It’s likely that drone delivery services will continue to expand across many nations. And businesses using drones can even purchase comprehensive insurance coverage, thanks to a recent partnership from 3DR and Harpenau Insurance.

The 3 big takeaways for TechRepublic readers

1. Online marketplace AHA partnered with drone company Flytrex on the world’s first fully autonomous drone service, launching this week in Reykjavik, Iceland.

2. The drone delivery service can cut down delivery time from 25 minutes to four minutes, with a 60% reduction per delivery cost.

3. It’s likely that drone delivery services will continue to grow worldwide.