Dell drops UPS, will use rivals

Discussion in 'UPS Discussions' started by Channahon, May 14, 2007.

  1. Channahon

    Channahon New Member

    Interesting article on Dell and UPS. And the green lined words are part of the article.
    And positive recognition for service providers. (package, hub, feeders and air)

    By Matt Kempner
    The Atlanta Journal-Constitution
    Published on: 05/12/07

    Dell, the nation's biggest maker of personal computers, has stopped relying on UPS, the world's biggest package deliverer, to handle its box deliveries in the United States.
    Instead, Dell is turning to UPS shipping rivals DHL and FedEx. The move cuts into Sandy Springs-based UPS' dealings with one of its biggest customers. But it is a boost for DHL's efforts to grow its presence in the U.S.

    UPS spokesman Norman Black said Dell and UPS "were simply unable to reach an agreement for pricing for renewal of this particular contract."

    None of the companies involved would disclose the dollar value of the deals. Dell shipped 20.5 million personal computers for the U.S. market last year, according to IDC, which tracks data about the technology industry. That represented just over half Dell's worldwide shipment of PCs.

    But Dell's market share has been slipping, and it has been looking for ways to streamline its operations and shave costs for everything from manufacturing to logistics.

    UPS had been the carrier for virtually all of Dell's U.S. package deliveries, Black said. While that ended effective April 1, UPS remains Dell's primary package deliverer outside the U.S. and will continue to handle logistics issues for the computer maker, he said.
    "They are still one of our largest customers," Black said.

    He declined to say where Dell had ranked among UPS' largest clients. He said the reduction in business between the companies is not a material event from a regulatory financial accounting standpoint.

    Ed Wolfe, a Bear Stearns analyst who follows UPS, earlier issued a report suggesting that the lost business is valued at about $150 million a year.

    Black said Dell's decision "has absolutely nothing to do with our level of service."
    DHL and FedEx declined to comment on their agreements with Dell. Amy King, a spokeswoman for the computer maker, also declined to comment on contracts.
    "We are always looking at ways to maximize our logistics and supply chain processes to provide better value for our customers," she said.

    Dell has stepped away from UPS before. In 2003, the computer company dropped UPS and jumped to FedEx. A few months later, it switched back. And in 2005, Dell negotiated what turned out to be a short-lived program for a contractor to ship some computers to U.S. post offices for customer pickup, rather than having UPS deliver them to the homes of consumers.
  2. outamyway

    outamyway New Member

    I doubt Fedex or DHL could handle that kind of jump for very long.
  3. scratch

    scratch Least Best Moderator Staff Member

    I remember when they used Fedex Ground. In my area, UPS would deliver them two days after they were ordered. It took Fedex Ground two to three weeks. We got them back soon after. Dell has been using DHL for a while to deliver accessories. I think they will be back.
  4. Overpaid Union Thug

    Overpaid Union Thug Well-Known Member

    I guess the old saying "you get what you pay for" comes to mind. It holds true with the bigger accounts anyway. Our higher rates are killing us. Our superior service usually brings the customers back but many customers are willing to take a step down in service to save money. Management blames the high union wages for our higher shipping rates. I'm not so sure that is the only reason though.
  5. browniehound

    browniehound Well-Known Member

    I would think this not such a bad loss. Does UPS even make money from delivery Dells? They are primarily res. deliveries and most take to the 2nd attempt to get them delivered. I for one, are happy to see them go.
  6. BCFan

    BCFan Active Member

    Hate to lose any business but our account reps don't need to give away the entire farm to keep the account....These large shippers think that UPS is supposed to bow and scrap and take a monetary lose for the priviledge of delivering their POS computers then so be it....Like buddy said ya get what ya pay for....:thumbup1: BC
  7. local804

    local804 Well-Known Member

    I see its dated yesterday but our center manager told us last month it was lost. They really suck to deliver but packages=more jobs
  8. dragracer66

    dragracer66 Active Member

    I found out the hard way just 4 week's ago. I went to and ordered a dell computer online using our discount, I entered the "special number" and half of the computer came Fed Ex and the rest came DHL 2 1/2 week's later. Then to top it off I wasn't home when DHL came so insted of them doing a 2'nd attempt they told me to call some 800 number to arrange for a pickup!! Never again!!!
  9. outamyway

    outamyway New Member

    Wow, now that's service:lol:
  10. Griff

    Griff Active Member

    I'll deliver a truck full of Dell's over Pottery Barn anyday of the week. I hope every night that we lose the Pottery Barn account. It makes my blood boil when I have to haul 6 149lb boxes up 3 stories because UPS is too stupid to put the stuff on our freight trucks.

    P.S. -- Dell will be back.
  11. moreluck

    moreluck golden ticket member

    Maybe Vegas has odds as to whether Dell will return to UPS. They bet on just about everything. I bet they return once they get disgusted with the non-service from FedEx & DHell.
  12. we (preloaders) don't like putting them on your truck pottery barn = the suck :lol:
  13. swing_drv

    swing_drv Member

    They will be back!!! DHL's Service sucks!!!!! UPS has alot of employee's next time any of you order a Dell demand them to ship it via UPS AND TELL THEM IF THEY DON'T YOU WILL REFUSE IT!!!!
    Last edited: May 14, 2007
  14. swing_drv

    swing_drv Member

  15. brownslave

    brownslave Guest

    Good no more killing my back with those danged boxes
  16. ImpactedTSG

    ImpactedTSG New Member

    HAHAHA.....most admired??? No wonder the stock price keeps tanking. I need it to get back up to around $80 so I can dump the rest of what I own.
  17. over9five

    over9five Moderator Staff Member

    "were simply unable to reach an agreement for pricing for renewal of this particular contract."

    Isn't that exactly what was said last time they dropped us? I'm not sure how long it lasted, but they came back because our service couldn't be beat. i hope to see Dells again onboard my car.
  18. Channahon

    Channahon New Member

    I don't think we should underestimate DHL. I ordered a 42" plasma and DHL called ahead of time to ensure I would be home for the delivery. And time in transit was comparable to UPS. If I had a choice of carriers, I would have chosen UPS. Driver was very polite, although not too many packages in his car.

    Now FedEx ground has the lawsuit pending, unhappy ground delivery, so not sure what FedEx may have offered to get the business.

    BLACKBOX Life is a Highway...

    I agree with Giff, I remember when FDX had Pottery Barn, I used to laugh at the driver lugging those tables and chairs up the driveway. Can't stand the way it takes so much space in your truck and now he's probably laughing at me. The article says the Dell contract if worth about 150 mil a year, if thats all we're making get rid of them until we can make some real money for our labor.
  20. the_hobbit

    the_hobbit Professional Box Thrower

    And yet i still sort alot of dell boxes, granted not as much as before, but still quite a few...