UPS Timeline from a Major Shipper's POV

Discussion in 'UPS Union Issues' started by Hoaxster, Jun 2, 2013.

  1. Monkey Butt

    Monkey Butt You can call me Chappy Staff Member

    I was shooting a retirement party and I noticed this sequence of this major shipper's Point Of View of UPS.
    They had 6 or 7 categories and these were on the Transportation timeline.

    There were only 4 "snapshots" of UPS and there were 5 of FedEx - a bit disconcerting from a UPS centric POV.
    ​I remember, prior to 1997, that we considered all 100% to be our packages.

    UPS Timeline_web.jpg
  2. CharleyHustle

    CharleyHustle Active Member

    The '97 strike is what the company will always reference when it comes to market share. Just my opinion, but the strike and other factors made UPS realize that a large percentage of packages are money losers. Most innovations and processes since then have had the express purpose of eliminating those money losing packages and maximizing profit on the ones that we still deliver.
  3. TimeForChange

    TimeForChange Active Member

    I don't know if those percentages are accurate. But even if they are, since that 1997 strike, the amount of packages shipped in the US and worldwide has increased drastically due to people buying things at home, using home shopping networks on TV, and of course, the internet. The proof is in UPS's profits, which keep going up. 50% of 8 billion packages per year, (UPS DOES ship over 4 billion packages a year) is much better than, say, for example 90% of 3 billion packages.
  4. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    90% of 8 billion is 7.2 billion.

    You can rationalize it anyway that you like but the bottom line is that we are losing market share due, in part, to our price point. The wage differential, which was partially addressed with the new 4 year progression, will need to be fully addressed in 2018.
  5. oldngray

    oldngray nowhere special

    Ground residential packages were never a big money maker. Now ground just provides the infrastructure and the big profits come from air and international. And possibly logistics.
  6. How many packages have we lost due to routes being cut?....Plenty..Its real hard to get a new customer but it is very easy to lose them!!
  7. Monkey Butt

    Monkey Butt You can call me Chappy Staff Member

    To clarify, this is not a UPS produced timeline or percentages.

    I was at a company that is a major customer of UPS with several distribution locations around the US.

    ​The impression I got was that this company was proud they had diversified their transportation small package carriers after the 1997 strike.
    UPS Timeline_web.jpg
  8. CharleyHustle

    CharleyHustle Active Member

    Market share can be overrated. If you have 100% of the market but lose money on 40% of it, why not get rid of that losing 40%. UPS has systematically gotten rid of customers and packages that they lose money on. Orion is simply the next example of this. Will Orion result in lost customers? Certainly. But will UPS make more money on the packages that are left? More than likely.
  9. Coldworld

    Coldworld Well-Known Member

    Did ups really think about the ramifications of market share being lost before they gave the union the best, final offer?? Knowing how they overly micromanage everything I'm surprised they didn't already have thought of 100 different senerios that could have happen before they got down to zero hour before the strike..
  10. PiedmontSteward

    PiedmontSteward RTW-4-Less

    This is a very valid point and one Jim Kelly should have considered more carefully before pushing his bull:censored2::censored2::censored2::censored2: last, best, and final offer to the IBT negotiating committee in 1997.
  11. Monkey Butt

    Monkey Butt You can call me Chappy Staff Member

    From what I have heard around the halls of Corporate:

    1) Top management never understood the revengeful nature of Ron's relationship with UPS.
    He was a petty person in many ways that was only understood after the fact.
    I only learned after the strike that Ron had his customers coming down to his package car to get their packages while he sheeted them up as if he went to their apartments and offices.
    UPS found out about this and changed his time study to reflect actual conditions.
    He vowed at that time that he would get even with UPS and he certainly did.

    2) UPS thought the drivers were more loyal to UPS than to the Teamsters especially since the reason for the strike was that UPS was going to take over the "cash" cow of the Central States pension fund. Which, by the way, UPS did less than a decade later.
    Prior to 1997, UPS had a paternalistic attitude towards their employees.
    I think we all understand the relationship is not the same since.

    3) Based on the above, UPS never thought there would be a strike,
    Definitely a miscalculation by the 1997 Management Committee and in particular Jim Kelley who knew Carey before coming to Corporate.
    ​So, yep, I agree with you.
  12. Monkey Butt

    Monkey Butt You can call me Chappy Staff Member

    Agreed but at the same time, a watershed moment for UPS which has since, decreased it's reliance on Teamster UPSers and the US Ground market.
    It will be interesting to see what UPS US operations looks like in 20 years.
    ​Hopefully, I'll still be alive to see that future status.
  13. Hopefully the company will be there in 20 years!!!The titanic was supposed to be a perfect ship!!I just hope the big brown corporate iceberg don't s(T)ink us!!!!...................P.S. this was not a shot a stink219 in anyway shape or form!!
  14. Bagels

    Bagels Family Leave Fridays!!!

    While I appreciate and acknowledge the viewpoint you're getting at, I think it's somewhat short sighted:

    1) In 1997, e-commerce was in its infancy but its potential was universally recognized. This was a new, emerging market from shippers primarily with no or limited shipping relationship - the first truly open door for competition to UPS. It'd be naive - to say the least - to think that without the 1997 strike, UPS would've continued to carry this volume at a high market clip.

    2) While FedEx credits the strike for its entrance into the ground arena, it had explored entering the market for many years & was already courting RPS - but was weary of its reputation. At best, the strike was a catalyst. FedEx may have otherwise built an operation from the ground up (no pun intended) ... but I'd bet that it wouldn't had made much difference in its 2013 market share. Given FedEx's disdain fro unions, you can bet they would've modeled their operation on RPS, Airborne, etc.'s incumbent independent contractor models.

    3) The strike also presented an opportunity for UPS: e-commerce grew much faster than anticipated, and RPS-FedEx Ground took on more volume than it could handle (a combination of shippers upset over the strike and willing to switch, an FedEx's aggressive pricing). As you recall, in 2000, this lead to a disastrous Holiday season for FedEx, in which thousands of people (mostly children) would up receiving their gifts after the Holidays were over ... and UPS received an incredible, last-minute volume push. Unfortunately, they did not hold onto it. The misery continued for FedEx; for example, it could not handle NewEgg's volume (which didn't grow until after 2002), which pushed NewEgg to UPS. NewEgg openly acknowledges that it's loyal to UPS because UPS took care of them, thus they'll stick with UPS even though they could get better rates elsewhere. Kinda sad that UPS wasn't able to develop such relationship elsewhere.

    4) UPS was preparing to go public when the strike occurred. UPS didn't go public to reward its employees -- it did so to reward its management. Its relationship with its employees was already changing for the worse.

    - - -

    While I'm not saying this is the case that you witnessed... there will always be companies that blame everyday business decisions on events with little to no effect just to drive a political point, especially when it involves unions.
  15. 'Lord Brown's bidding'

    'Lord Brown's bidding' Well-Known Member

    Companies don't go public to reward management anymore than they go public to reward employees. They go public to grow, and grown UPS has. Management is just in a better position to catch more of the benefits. Thus, they do more to "grow the business" in the ways that management does, trying to create and maintain an efficient operation. Management-even the CEO-are all "employees", too.

    Drivers and even PT hub workers have benefits, too, because UPS went public, they just aren't perceived as such. However, while the Union is necessary to make sure we get our fair share of the pie, the pie is there, in part, because of UPS going public and the money it generated allowing UPS to do what it felt to improve the company. EDD, PAS, MyChoice-while we drivers disdain them, I do see how they have made the company better. The acquisition of Overnight, even the attempted acquisition of TNT, are things made possible by going public.

    The benefit to me is the company stays profitable and atractive, and in no danger of drastically reducing it's workforce, to say nothing of going out of business. Thus, at the height of the recession, I had a deep sense of security knowing that while work loads were light my job wasn't in danger. I have had to have several conversations with my wife about why I am not as afraid as she thinks I should be when it comes to looking for a new house or some other big purchase. Her brother-in-law was laid off from his job, and thus his family is always worried about the possibility of being "downsized", so they are hesitant about big purchases. Myself, the only reason I have to worry-at this time, anyway-is when I do stupid things that can lead to discipline. That assurance is in large part due to UPS going public many years ago. Conditions haven't necessarily improved work-wise, but the company is making big profits, and should be around long enough for me to do what I need to set myself up for retirement, another two decades at least.
  16. BCFan

    BCFan Active Member

    Prior to 1997, UPS had a paternalistic attitude towards their employees.I think we all understand the relationship is not the same since.

    Paternal my rear end , oh yeah paternal like a abusive father that continually beat the snot out of their kids. UPS only wants to mistreat and abuse the hourly the way upper management cursed lower management on conference calls every flipping day......BC (BETTER CONTRACT)
  17. Xexys

    Xexys Retired and Happy

    I remember watching Jim Kelley on CNBC and the interviewer was asking him when and if UPS would go public. Jim vehemenently denied that UPS would ever go public. Four or five months later we let 10% of our stock out to the public in IPO. Might I add that that was around the same time that the stock split. Can't remember if it was before or after the IPO. I'm getting old...:(
  18. 'Lord Brown's bidding'

    'Lord Brown's bidding' Well-Known Member

    The assertion that UPS is losing customers in large part because of "poor service" and letting good customers go is not an entirely acurate one. I have many of my customers, or rather my customers' shipping and receiving managers, tell me they'd rather use us, or don't know why we were stopped being used in the first place, as the relationship was solid with no problems. They just received a memo one day from upper mgmt stating they were going to use FedEx. That's because of price, not reputation or stuffing as many stops down a driver's throat and thus getting deliveries later in the day. It can also be pointed out that FedEx can afford to put more drivers on the road-and thus offer somewhat better delivery times-in part because their drivers cost less, so they can use more of them. However, I really don't think that is a big issue as much as price. I know many drivers don't want to hear that, but that is mainly it.
  19. 'Lord Brown's bidding'

    'Lord Brown's bidding' Well-Known Member

    Many of the longer-tenured employees on this site beg to differ. I have been employed long enough at UPS to see a marked decline in the relationship in the years since UPS has gone public, a decline I didn't quite understand until getting much of the back story on Brown Cafe. Like any father-child relationship, there were gripes along the way, but UPS was not viewed as abusive.
  20. Anonymous 10

    Anonymous 10 Guest

    I bet the stuff ups is doing with medical logistics blows everything out of the water in five years. Watch for this.