What is a UPS? (company type, client + more)
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When something becomes a regular part of your environment, like a big brown UPS truck, it’s easy to stop being curious about them.
But how much do you really know about the companies behind those big brown trucks full of goodies – what is UPS and what do you need to know? If you want to know, keep reading!
What is the UPS of 2022?
UPS is a company focused on global package delivery, shipping/receiving and supply chain management, founded in 1907 and continuing to grow in 2022. Carol Tomé, chief executive of UPS, the world’s premier package delivery company that typically caters to both individuals and large corporations, said its biggest customer in 2021 is shipping giant Amazon.
There’s still a lot to learn about UPS and how it works, so be sure to keep reading to learn more about the world of UPS!
What kind of company is UPS?
UPS is a package delivery company that is also involved in parts of the shipping industry.
Involved in supply chain management, UPS was founded by two teenagers in 1907 and is now a Fortune 500 company.
Founded in 1907, UPS became the first package delivery company to serve all addresses in the continental United States in 1975.
During this time, UPS also expanded its service to Toronto outside the United States.
Ten years later, UPS also became the first company to offer next-day air freight to the entire United States, as well as intercontinental service in Europe.
Since then, UPS has grown exponentially and opened its stock to the public in late 1999, in the largest public offering of more than 100,000,000 shares of the century at $50 per share.
As far as the company’s philosophy is concerned, UPS’s business philosophy is “customer first, people first, innovation driven”.
You can break down each of these phrases in different ways, but in UPS’s own words, each phrase means the following:
- Customer First: “By focusing on what matters most to our customers – speed and convenience – we aim to deliver the best digital experience powered by our global network of smart logistics.”
- People First: “Our purpose is to move our world forward by delivering what matters… We are modernizing our strong values-based culture and encouraging our people to be their true selves at work.”
- Innovation Driven: “We’re leveraging world-class technology and ingenuity to turn productivity into a virtuous circle and achieve operational excellence…improving productivity from our assets and improving the quality of revenue in America to generate better bottom-line results.”
UPS also works on Environmental, Social and Governance (ESG) programs to help improve local communities.
You can learn more about UPS’s social commitment, history and revenue summary by visiting the company profile page on the UPS website here.
Who is UPS’s largest customer?
While UPS does have a customer base across shippers and consignees, recent shifts in business strategy have led UPS to devote more resources to larger partners.
This strategic focus is largely due to UPS’s new CEO, Carol Tomé, embracing a “better, not bigger” philosophy.
The philosophy focuses on extracting more profit from UPS’s facilities and operations, while examining areas where returns are lower.
This all led UPS to focus on its biggest customer: Amazon.com.
Amazon paid $11.3 billion for its shipping services last year, meaning Amazon’s business alone accounted for 13.3 percent of UPS’s total revenue.
From this perspective, UPS’s other major customers contribute no more than 10% of UPS’s revenue.
Ms. Tomei said Amazon is critical to providing the shipping volume UPS needs to fill and pay for its vast delivery network.
When asked about this shift in focus on Amazon and other large UPS customers, Tomé said:
“For the network business, with so much money invested in fixed assets, we really need volume… We also want to attract a customer base that values the end-to-end experience and is willing to spend more.”
While UPS doesn’t necessarily disclose a full list of its key customers, many UPS employees are able to gain insight into the companies they work with and the brands they see most often.
Other top UPS customers are as follows:
- hello fresh
- Target
- Costco
- walmart
- QVC
- Macy’s
- Ulin
- Zappo
If you’re interested in reading more about UPS’s partnership with Amazon and its strategy to focus on bulk customers, you can check out this Wall Street Journal article.
Is UPS only in the US?
Given that UPS was created and established in the United States, and has done a lot of business in the country, you might wonder if it serves other regions.
Well, even though UPS has a huge presence in the US, it’s actually a global company.
UPS serves more than 220 countries and territories around the world, delivering 24 million packages a day.
Of UPS’s 534,000-member team, approximately 90,000 members (also known as UPS employees) are employed outside the United States.
To learn more, you can also read our posts on UPS Complaints, Does UPS Need a Signature, and UPS Cash on Delivery.
in conclusion
United Parcel Service, commonly known as UPS, is a company specializing in global package delivery, shipping/receiving, and supply chain management.
Founded in the United States in 1907, UPS has grown into one of the world’s largest shipping companies with 534,000 employees worldwide.
