Known as the world’s largest package delivery company, United Parcel Services (UPS) is a leading global provider of specialized transportation and logistics services. Commonly referred to as UPS, this Georgia based company delivers more than 15 million packages a day to 6.1 million customers in 200 or more countries and territories around the globe. Well known for its brown trucks, UPS also operates its own airline: the IATA: 5X, ICAO: UPS and Callsign: UPS. The company’s airline is based in Louisville, Kentucky where the UPS Worldport air hub is also located.
Time-definite delivery of packages and documents is what UPS is all about. The company has been extending their services for the past years and included less than truckload transportation and supply chain services. The company’s operations are divided into three segments: Supply Chain and Freight Operations, International Package operations and U.S. Domestic Package operations.
The domestic package operations include the on-time delivery of documents, letters, and packages around United States. The International Package operations on the other hand is responsible of on-time delivery to more than 200 countries and territories around the globe, including shipments outside the U.S. and shipments with either origin or distribution outside of the U.S. The Supply Chain and Freight services include the company’s forwarding and contract logistics operations, UPS Freight and other related business units. Providing services in more than 175 countries and territories worldwide, the UPS forwarding and logistics business is one of the company’s strength. This service includes worldwide supply chain design, execution and management, freight forwarding and distribution, customs brokerage, mail and consulting services. UPS is known for offering freight services that comes in variety of less than truckload (“LTL”) and truckload (“TL”) services for North American customers. Mail Boxes Etc. and UPS Capital are the two business units under this segment.
The company’s humble beginning started in 1907 when there was a great need for private messenger and delivery services. A teenager by the name of James E. Casey or better known as Jim saw this need as a business opportunity and started his own American Messenger Company in Seattle, Washington. The newly formed company focuses on package delivery for retail stores and began using motorcycles to keep up with competition. For about two years, the company was servicing the United States Post Office by helping them deliver all special delivery mail entering Seattle. For the next years the company made significant changes including the use of consolidated delivery and by partnering to its competitor. The merge brought tremendous success to the company which made them score their biggest customer, three of Seattle’s largest department stores.
By the year 1919 the company expanded its business outside Seattle and changed its name to United Parcel Service. UPS was one of the few companies in the country that offers common carrier service at the time. The decision to continue with its common carrier service even with an acquisition has somehow influenced the growth of UPS for years to come. The development of the first conveyor belt system for handling packages is one of UPS technological innovations that made a difference in the Postal industry.
Becoming a leader in global supply chain management is not easy and it requires the full commitment of the company. Presently, UPS is upholding its global distribution and logistics, and managing not only the movement of goods but also the information and funds that go with those goods. The company is also doing its share in environment by using electric vehicles and by developing water conservation techniques. Gaining wider access to various markets is the key for the company’s success, and more acquisition is the way to do it.
UPS Common Carrier
The expansion of the company’s services started when they acquired the “common carrier” rights to deliver packages between all customers, both private and commercial. This company move placed UPS in direct competition with USPS and in direct opposition to the regulations of the Interstate Commerce Commission (ICC). In 1952 UPS decided to extend their services in cities where they could use their common carrier operations without the authority of state commerce commissions and ICC. Chicago is the first city outside California where they offered the common service carrier.
Although the company is working for better access to ground routes, another part of the company is establishing the UPS access to the air. The year 1929 made UPS the first package delivery company to provide air service via privately operated airlines. But because of the Great Depression the service ends in the same year. The company’s air operations resumed in 1953 and started offering two-day service to major cities both in east and west coasts. By 1978, the UPS Blue Label Air was available in every state, including Alaska and Hawaii.
The increasing demand for air parcel delivery made UPS one of the most in demand Delivery Company in the country. Due to federal deregulation of the airline industry, UPS began to assemble its own jet cargo fleet. The company also included the overnight air delivery business and Next Day Air service which was available in all 48 states including Puerto Rico, Alaska and Hawaii. 1985 is the year where UPS entered a new era with international air package and document service. This new service links the U.S. and six European countries and by 1988 UPS received its authorization from the Federal Aviation Administration (FAA) to operate its own aircraft. Officially becoming an airline, UPS managed to merge a number of cultures and procedures to create a seamless operation called UPS airline.
Known as the fastest-growing airline in FAA history, the UPS airline was formed in more than a year with all the necessary support systems and current technology. Today, the airline managed to stay on top of its game as one of the 10 largest airlines in the United States. This airline features some of the most highly-advanced information system and airline technology including the Computerized Operations Monitoring, Planning and Scheduling System (COMPASS), a state of the art system that provides information for flight planning, load handling and scheduling. This system is very unique for it can plan optimum flight schedules for up to six years in advance.