The Growth of UPS through the Decades

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The Logistics industry is a multi-billion dollar industry and one of the most important industries globally. Servicing companies such as Amazon, Microsoft. A leading name in the logistic industry is the United Parcel Service (UPS).

The UPS brand name is used to denote many of its subsidiaries and divisions, which includes its cargo airline (UPS Airlines), freight-based trucking operation (UPS Freight, formerly Overnite Transportation), and its delivery drone airline (UPS Flight Forward). UPS is a global logistics company that is headquartered in the United State city of Sandy Springs, Georgia, which is a part of the Greater Atlanta metropolitan area.

On August 28, 1907, James Casey founded the American Messenger Company with Claude Ryan in Seattle, Washington, capitalized with $100 in debt. Most deliveries at this time were made on foot and bicycles were used for longer trips.

Looking at the growth of UPS, the American Messenger Company from inception has been focused primarily on package delivery to retail stores. Its largest client is the U.S Post Office. In 1913, the company acquired a Model T Ford as its first delivery vehicle. The founders Casey and Ryan merged with a competitor, Evert McCabe, and formed Merchants Parcel Delivery. 

Subsequently, Consolidated delivery was introduced, combining packages addressed to a certain neighborhood onto one delivery vehicle. 

In 1916, Charlie Soderstrom joined Merchants Parcel Delivery bringing in more vehicles for the growing delivery business. In 1919, the company expanded for the first time beyond Seattle to Oakland, California, and changed its name to United Parcel Service. 

The name change to United Parcel Service was a reminder that the company’s latest expansion operations were still United under the same organization and Parcel identified the type of business offered as part of its Service. 

Common carrier service was acquired in 1922 from a company in Los Angeles, California. UPS became one of the only companies in the United States to offer common carrier service. At first, the common carrier was only limited to a small area around Los Angeles but by 1927 expanded to areas up to 125 miles outside the city. In 1924, a conveyor belt system was debuted for the handling of packages for UPS operations.

As part of its expansion policy, in 2019, UPC announced a partnership with autonomous trucking startup, TuSimple to carry cargo across Phoenix, Arizona, and Tucson, Arizona. And in October 2019, UPS was approved by the Federal Aviation Administration to fly drones. This certification will allow UPS to deliver health care supplies using its fleet of drones. 

Despite the COVID-19 pandemic, UPS shifted its target to smaller customers to boost profits; as a result, UPS recorded a 21% jump in their fourth-quarter sales to $24.9 billion. According to CEO Carol Tomé reported that Amazon paid UPS $11.3 billion in shipping in 2020, accounting for about 13.3% of the company’s total revenue. 

UPS over the years has rebranded itself and carved a niche for itself in the delivery service and logistics industry. And regardless of the various expansions that the company has gone through, the changes in leadership and company’s outlook, and the COVID-19 pandemic, UPS continues to wax stronger as a pioneer and pacesetter in the industry. 

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