United Parcel Service announced Monday afternoon the adoption of a new operating model and leadership structure aimed at better exploiting its global network to accelerate profit growth as it evolves from a traditional small package carrier to more of an integrated logistics provider.
The timing of the move coincides with the major phase-out of low-margin Amazon business and downsizing of its domestic parcel network, which were largely completed by the end of June.
Under the new approach, UPS (NYSE: UPS) will standardize processes and procedures across geographies while maintaining the flexibility to meet the unique needs of local markets. UPS said it wanted to give customers greater consistency, agility, and scale as the company deemphasizes its traditional status as a small package carrier to focus more on being an integrated logistics provider.
As e-commerce growth normalized following the Covid-fueled boom and low-cost delivery competitors entered the market, UPS parcel volumes have stagnated.
Why It Matters: The company has stressed for two years that it intends to deemphasize last-mile delivery of e-commerce packages and focus more on high-value, premium market segments like healthcare, industrial, and automotive logistics, as well as services for small-and-medium size businesses. Now there is more concrete evidence about the direction UPS is going.
#Growth #package #integrated #provider
The timing of the move coincides with the major phase-out of low-margin Amazon business and downsizing of its domestic parcel network, which were largely completed by the end of June.
Under the new approach, UPS (NYSE: UPS) will standardize processes and procedures across geographies while maintaining the flexibility to meet the unique needs of local markets. UPS said it wanted to give customers greater consistency, agility, and scale as the company deemphasizes its traditional status as a small package carrier to focus more on being an integrated logistics provider.
As e-commerce growth normalized following the Covid-fueled boom and low-cost delivery competitors entered the market, UPS parcel volumes have stagnated.
Why It Matters: The company has stressed for two years that it intends to deemphasize last-mile delivery of e-commerce packages and focus more on high-value, premium market segments like healthcare, industrial, and automotive logistics, as well as services for small-and-medium size businesses. Now there is more concrete evidence about the direction UPS is going.
#Growth #package #integrated #provider
4 days ago
