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UPS Supply Chain Solutions
Atlanta, GA
NYSE: UPS (United Parcel Service)
800-742-5727
Bob Stoffel, President
3PL Turnover: $7.7b Parent $42.5
Service Area: Service to 99% of World GDP; NA locations: 239 U.S., 58 Canada, 11 Mexico
3PL Assets: 25,000 employees
1,238 warehouses
900 tractors, 2,450 trailers
Information Systems: Excellent
TMS - i2
WMS - operates all major systems
Services: Air and ocean freight forwarding, customs brokerage, transportation management, warehousing and distribution, supply chain consulting, dedicated contract carriage, trade finance and insurance, equipment leasing, mail services
Industry Focus/Key Customers: Computers and electronics, telecommunications, healthcare, automotive, retail, consumer goods
Key Customers: Alcatel, Adidas, Cisco, Daimler/Chrysler, Fabricut, General Motors, Honeywell, Hitachi, Kingsdown, Nikon
Armstrong & Associates' Evaluation: UPS SCS grew 11% in 2005. It has become the most well known U.S. 3PL brand name. Revenues for contract warehousing were $1.2 billion in 2005. Freight forwarding net revenues were $3.3 billion. EBIT margin was 3%. UPS SCS' EBITA target is 8%, but it may take two to three more years. In the mean time, it contributes $1 billion per year in package business to its big brother. UPS handles 660,000 TEUs per year as a freight forwarder. UPS Capital Freight and Consulting continue to be important contributors.