When something becomes a regular part of your environment, like the big brown UPS trucks, it’s easy to stop being curious about them.
However, what do you really know about the company behind those big brown trucks filled with goodies- what is the UPS, and what do you need to know about it? If you’d like to find out, keep reading!
What Is the UPS In [currentyear]?
UPS is a company that specializes in global package delivery, shipping/receiving, and supply chain management that was founded in 1907 and continues strong in [currentyear]. UPS is the world’s premier package delivery company and typically caters to both individuals and large companies, with its biggest customer in 2021 being the shipping giant Amazon, according to CEO Carol Tomé.
There’s so much more to understand about UPS and how it operates, so be sure to keep reading for a deeper dive into the world of UPS!
What Kind of Company Is UPS?
UPS is a package delivery company, that also participates in parts of the shipping industry.
UPS participates in supply chain management and is now a Fortune 500 company after being founded in 1907 by two teenagers.
From its founding in 1907, UPS became the first package delivery company to serve every address in the continental United States in 1975.
During this time, UPS also expanded its services beyond the borders of the United States to Toronto.
Ten years later, UPS also became the first company to offer next-day air delivery to all of the United States while also offering intercontinental services in Europe.
Since then, UPS has grown exponentially and opened its stocks to the public in late 1999, making the largest public offering of the century of over 100,000,000 shares at $50 per stock.
In terms of what the company stands for, UPS operates off of the motto “customer first, people-led, innovation-driven”.
You can break down each of these phrases in different ways, but in UPS’ own words, each phrase means something like this:
- Customer First: “By focusing on what matters most to our customers – speed and ease – we aim to provide the best digital experience powered by our global smart logistics network.”
- People Led: “We’re guided by the purpose of moving our world forward by delivering what matters… we’re modernizing our strong values-based culture and encouraging our people to bring their authentic selves to work.”
- Innovation Driven: “We are using world-class technology and ingenuity to make productivity a virtuous cycle and achieve operational excellence… driving more productivity from our assets and improving U.S. revenue quality to generate better bottom-line results.”
UPS also has an environmental, social, and governance (ESG) program that it’s committed to in order to help improve local communities.
You can read more about UPS’ social commitments, history, and revenue summaries by visiting the company profile page on the UPS website here.
Who Are UPS’ Largest Customers?
While UPS does have a customer base among individual shippers and receivers, a recent pivot in business strategy has led UPS to commit more resources to larger partners.
This pivot in strategy is largely due to UPS’ new CEO, Carol Tomé, incorporating a philosophy of “better, not bigger.”
This philosophy focuses on squeezing more profits out of UPS’ facilities and businesses while scrutinizing areas of lower returns.
This has all led to UPS focusing on its biggest customer of all: Amazon Inc.
Amazon paid UPS $11.3 billion last year for its shipping services, which means that Amazon’s business alone makes up 13.3% of UPS’ total revenue.
To put this into perspective, no other major customers of UPS contribute more than 10% to UPS’ top line.
Amazon is critical to providing the shipping volume UPS needs in order to fill and pay for its huge delivery network, according to Ms. Tomé.
When asked about this shift in focus towards Amazon and other large UPS customers, Tomé said:
“With a network business, with so much capital invested in your fixed assets, we really do need volume… we also look to lean into 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 top customers, plenty of UPS employees are able to give insights into the companies they work with and the brands they see most often.
Other top customers of UPS are as follows:
- Hello Fresh
- Target
- Costco
- Walmart
- QVC
- Macy’s
- Uline
- Zappo’s
If you’re interested in reading more about UPS’ partnership with Amazon and its strategy of focusing on higher-volume customers, you can check out this Wall Street Journal article.
Is UPS Only in the United States?
Given that UPS was created and founded in the United States, and does quite a bit of business in the country, you may wonder if it serves other areas.
Well, UPS, despite having a huge presence in America, is actually a global company.
UPS serves over 220 countries and territories around the world and delivers something to the tune of 24 million packages a day.
Of UPS’ 534,000 member team, approximately 90,000 members (also called UPSers) are employed in countries outside of the United States.
To learn more, you can also read our posts on UPS complaints, does UPS require a signature, and UPS collect on delivery.
Conclusion
The United Parcel Service, most commonly referred to as UPS, is a company that specializes in global package delivery, shipping/receiving, and supply chain management.
UPS was founded in 1907 in the United States and has since grown to be one of the biggest shipping companies in the world, employing 534,000 people worldwide.
