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United Parcel Service (UPS) Insights for Parcel Delivery Business

By Akshat Bansal 7th August 2018

United Parcel Services (UPS) is one of the world’s biggest courier and package delivery service. UPS was established in Seattle, Washington in 1907 bearing the name “American Messenger Company.” The organization would later experience a difference in the name in 1919 after it extended its tasks outside of Seattle. The organization has since developed to becomes the world’s largest package delivery service with more than 454,000 representatives worldwide and income of more than 65.8 billion U.S. dollars in 2017 alone.

In 2017, the organization’s domestic parcel revenue added up to around 40.7 billion U.S. dollars. In that same year, income produced from international parcel delivery remained at around 13.4 billion U.S. dollars. UPS’s local rivals incorporate the United Postal Service (USPS) and FedEx Corporation, while a portion of its global rivals incorporates, Canada Post, the Royal Mail, and Deutsche Post.

UPS Founders, Investments, and Timeline:

Founders: James E. Casey

Founded Date: 28 August 1907

Headquarter: Atlanta, Georgia, United States

Number of Investments: 11

Number of Acquisitions: 18

IPO Date: Nov 10, 1999

IPO Share Price: $50.00

Money Raised at IPO: $5.5B

Timeline of UPS

United Parcel Service

Regardless of how far you are from your closest neighbor, in the event that you live in the United States or Europe, UPS can deliver to your address. UPS can deliver to 80 percent of the planet inside 48 hours, so in the event that you live elsewhere, it’s still truly likely that UPS can discover you to drop off or get bundles.

Delivering packages to every buyers’ doorsteps is more expensive than delivering various shipments in the meantime to one area, similar to the case for shipments between organizations. That alleged last mile delivery is the most costly leg of the excursion: more individual packages bound to more individual delivers implies more weight to edges, a risk that once again materialized in UPS’ results.

UPS Business Segment

UPS gives a variety of products and services to its clients through its three primary fragments.

US Domestic Package – This portion offers clients a full range of US local ensured ground and air package delivery.

International Package Delivery – This portion comprises of package delivery activities in Europe, Asia, Canada, Latin America, the Indian subcontinent, the Middle East, and Africa.

Supply chain and Freight segment – The company’s logistics and supply chain expertise provide financial, trade, transportation and distribution services.

Growing Markets

Europe represents more than 50% portion of UPS’s International Package fragment. One is that a noteworthy piece of Europe’s GDP (total national output) incorporates export of various products. The business sectors in Europe are profoundly divided, which gives higher opportunities for delivery service providers. Other significant delivery service specialist organizations in Europe incorporate TNT Express (TNTE) and Deutsche Post (DPSGY). Yamato Holdings (YATRY) is a noteworthy player in Japan.

The organization is hoping to see new open doors in Asia-Pacific, the United Kingdom, Germany, Italy, France, Spain, and the Netherlands.

UPS Revenue Drivers

There are three fundamental drivers of revenue for United Parcel Service (UPS): volumes, Price, and fuel additional charges. Volumes, price, and additional charges are thusly determined by financial development.


US local volumes were driven mostly by expanded retail deals and web-based business request in the nation. Development in international volumes was because of an expansion in trades, which was driven by the retail, automobile and healthcare sector.


Pricing is influenced by base rates, normal weight per parcel, and product mix. While both base rates and normal weight per parcel expanded for UPS, changes or modification in client requirements from UPS’s premium to standard ones lowers the pricing. Worldwide costs were additionally influenced by the unfavorable money effect.

Fuel additional charges

UPS applies a fuel additional charge on local air and ground parcel delivery services. Fuel extra charge income diminished for the household fragment, while it enhanced marginally for the worldwide delivery services. However, the impact of fuel additional charges remains the same in both segments.

Get in touch with us if you are interested in starting your own branded business in Parcel Delivery Industry.


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