Flytrex wants to prove that drones are a realistic option for on-demand logistics with a new delivery program that took flight in Iceland’s capital today. While other companies, including Amazon, have tested drone deliveries, Flytrex says this is the first time a fully operational on-demand drone delivery service has launched in an urban area. Drones will take orders from online marketplace AHA’s headquarters in Reykjavik to a destination two miles away during the project’s first phase.

Headquartered in Tel Aviv, Flytrex raised a $3 million Series A earlier this year for its drone technology. Its drones were approved by the Icelandic Transport Authority to pick up orders from restaurants and stores on one side of Reykjavik and fly them to a designated drop-off point in the suburb of Grafarvogur.

Flytrex CEO and co-founder Yariv Bash says Reykjavik is a good place to test the efficiency of drone deliveries because parts of the city are separated by a bay. Drivers often need to navigate around the shoreline, but drones can just fly over the water. Deliveries that would usually take 25 minutes by car in Reykjavik can be completed by a Flytrex drone in only four minutes, the company claims. Not only are deliveries faster, but they can also more cost-efficient. Bash says AHA has already seen a 60 percent in cost per delivery by using drones.

Drones can handle packages that weigh up to 3 kg and are a bit larger than a shoebox, so deliveries are currently best suited for smaller orders or restaurant food. During the first part of the Reykjavik program, Flytrex will fly one drone that will make 20 deliveries per day for AHA, before adding more over the next few weeks. Its goal is to make hundreds of deliveries per day directly to customers’ yards within a few months.

Backyard deliveries are possible in Reykjavik because much of the city is suburban. Flytrex’s drones use smart mapping to adapt to other environments and operate at about 50 meters in the air, which means they can clear most obstacles. Bash says Flytrex is already working on a project in an area with many high-rise buildings and is currently seeking approval from regulators in European, South American and Central American countries.

“In high-rise environments like Manhattan, the most likely scenario is to have drones deliver packages at the entrance to buildings or on rooftops, which our system is already capable of doing technologically speaking,” he says. “We believe that regulators approving city-wide drone delivery in high-rise urban environments is just around the corner.”