With UPS handling distribution, transportation and after-sale services, there are big rewards.
Companies large and small are unlocking strategic and financial gains through UPS logistics. The keys to your competitive advantage: capitalizing on UPS’s expertise, worldwide distribution and service infrastructure, experience and resources.
Grow without putting a lot of capital into building new buildings, hiring people or taking on new risks.
"Growing companies can leverage the infrastructure UPS has in place, whether they are expanding across the country or around the world," says Alan Amling, vice president of global contract logistics marketing. "You can grow without having to dump a lot of capital into building new buildings, hiring people or taking on new risks."
Seattle-based apparel company Cutter & Buck is one example. Ground shipments from its West Coast distribution center took five days to reach the East Coast. Considering that 80 percent of Cutter & Buck's U.S. customers are on the East Coast, the delay compromised competitiveness.
So the company outsourced East Coast distribution to UPS and now ships most of its small-package and East Coast-destined orders from UPS's Hebron, Ky., facility. The fulfillment center can get orders out the same day, shaving days off delivery times and saving a bundle on shipping. Another payoff: Cutter & Buck can easily scale up at the UPS facility during the holiday season and back down for the rest of the year.
Read the full Cutter & Buck case study.
Expanding geographic reach is just one challenge UPS is helping customers meet. UPS is also:
- Developing customized packaging solutions and store-ready displays for high-tech equipment and consumer product manufacturers
- Managing demand spikes from new product launches and seasonal fluctuations
- Improving profitability and the customer experience by managing product returns and repairs efficiently
UPS, a four-time recipient of a United Technologies Corporation Supplier Gold award and an Aerospace AS9120 certified 3PL, works closely with aircraft OEMs and their suppliers. UPS is providing production kitting and global spare parts support for aircraft OEMs and their customers, which enables them to maximize the efficiency of their manufacturing operation, cut costs and improve responsiveness to customers.
More benefits of leaving logistics to the experts
When it comes to patient healthcare, equipment downtime is never an option. Carestream Health, a provider of dental and medical imaging systems, maintains a team of field engineers to service tens of thousands of installed products worldwide. The company turned to UPS for help creating an expedited repairs system.
Now Carestream parts are stored at 70 UPS facilities worldwide and integrated with UPS's global transportation network for reliable, same-day service. Results: Emergency orders from field engineers fell 23 percent, money tied up in inventory dropped 12 percent, and the first-call success rate for equipment repairs rose by 3 percent.
Read the full Carestream Health case study.
Outsourcing is a strategic decision, Amling says, and a lot is at stake when you commit to a long-term relationship. But the overall benefits from a logistics partnership with UPS are well-worth a closer look:
- Financial. You minimize the capital investment required to lease or build, staff and maintain your own distribution and fulfillment operation. Volume-based pricing turns fixed costs to variable ones, since you can scale up or down as needed. That's particularly helpful for growing companies or those with seasonal peaks and valleys.
- Performance. Positioning inventory closer to customers reduces transit time and often overall transportation costs. There's more: Tighter control and visibility of inventory has a high payoff. Integrated UPS warehouse management systems help you track product velocity for more accurate demand forecasts.
- Technology. Customers gain access to all the IT and human resources UPS provides. UPS world-class technologies range from a single global integrated system to on-screen "dashboards" that deliver management information at push-button speeds.
- New markets, which are particularly valuable to growing companies. The most recent addition: two more distribution centers in China, for companies that want to tap into the huge consumer demand there. "China will account for about 23 percent of global consumption growth over the next 10 years," Amling says, referencing a McKinsey Global Institute report.
As the supply chain becomes more global and complex, companies are reducing the number of logistics providers they use and asking them to do more, he says. "What differentiates UPS is that we’re a full-service provider on a global scale. You can conveniently go from source to customer with one company handling distribution, transportation and after-sale service."
Shipping managers, be sure to share this article with your logistics team and help your company reach a new level of professionalism in logistics.
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