Shipping over 15 million packages a day with over 390,000 part time and full time employees, UPS is the largest shipping company in the world both by volume and revenue. With that many packages, one must wonder, how does a package get from point A to point B? In this section, we will talk about the life of a shipment when it goes through UPS’s Supply Chain and Freight service.
When UPS receives or picks up their last package from any of their 154,000 entry points such as dropboxes or customer centers at 6pm every business day (Monday-Friday), the shipment goes onto a truck to a local hub. The local hub is one of 1800 operating facilities around the world and is used to pre-sort packages. Once pre-sorted, workers load packages onto trucks that needs to be shipped locally through UPS ground or onto planes if it needs to go cross-country or internationally. The planes then take the parcels to WorldPort, which is the heart of their operations. (UPS, 2013)
Worldport is located in Louisville, KT, which is located only 2 hours or less away from 75% of the U.S. population. This is convenient for them because of the overnight shipping service that they began in the 1980’s to compete with competitors that offered the same service. The short time travel also allows them to keep their customers happy because of the speed in receiving their package (Schactman, 2012).
Once the planes arrive Worldport, this is where the magic begins for UPS. This factory is so efficient with time, they’re even able to coordinate the landing of planes in 2.5 minute intervals. This is important especially during peak seasons and to save money on jet fuel. There are 44 loading/unloading terminals that the planes can be taxied in to. Once there, the company emp...
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... and loaders have so that they don’t have to stop package handling in order to scan.
For an outsider looking in, this company is doing very well at managing their technologies used in how they do business. For managers within the company, there is always room for improvements in order to stay on top of the industry. Though UPS is fast at shipping, they can be faster. There have been talks within the company regarding shaving extra time from delivery by spending $70 million in sensors for their trucks that measure engine speed, oil temperature, seatbelt sensor, back up sensor and many others to monitor how the drivers are utilizing the trucks and time. This system will also include a key fob will start/stop the engine and lock/unlock overhead door. This along with being able to walk 2.5 paces per second will allow the company to save 6.5 minutes per driver per day.
Because of its location on the east coast it allows Gulfstream access to sea, air, and land. Gulfstream keeps cost low by contracting out the construction of certain parts of its aircraft and having them sent to Savannah. Gulfstream has suppliers in Holland, Germany, the U.S. and Mexico. The tail sections and floors of the Gulfstream G500 and G550 are made in Holland (Thuermer, 2004). These parts once assembled are then shipped to Amsterdam and then to U.S. to Savannah. For this reason, international shipping access is required. Once they arrive in the states, they are then trucked to the assembly plant on oversized truck loads. This short distance from the port to the plant is key to the success of the chain. It would require a lot of coordination to get these pieces to travel long distances. The engines are flown in from Germany to Atlanta International Airport where they are trucked to the plant in Savannah. Finally, the wings are built in Texas, and then shipped via railway to Savannah. All these connections require their final destination to be centrally located to ports where these parts can be delivered close.
UPS has seven regional hubs in the US with operations worldwide. UPS uses its own hub-and-spoke system to expedite its cargo around the world, but its principal hub is Louisville International Airport. The UPS air hub at Louisville is called Worldport. UPS selected Louisville has their hub for two reasons. First, because of its location as UPS can reach the majority of the US population within two or three...
UPS NEXT DAY AIR- Has the same delivery timing as the UPS 2-DAY after the next business shipment
Montealgre, Ramiro, H. J. Nelson, Carin I. Knoop, and Lynda M. Applegate. BAE Automated Systems (A): Denver International Airport Baggage Handling System. Rep. no. 9-396-311. Boston, MA: Harvard Business School, 1996. Print.
Federal Express is the world’s largest package delivery company today. They have been successful mainly because of their technological advancements. Technology has allowed them to have superior customer service and quality that was unparalleled by any company. No company was able to offer overnight delivery of packages with the speed and precision that Federal Express did. Although Federal Express remains ahead of its competition today, their advantages over other firms in the industry are slowly diminishing.
The trucking industry over the years have changed the type of services and the quality that it has provides to its customers. In today’s industry the focus is on efficiency with the overall beneficiary being the American consumer. Majority of today’s freight is being transported by truck during sometime in the distribution chain. Some of factors the trucking industry is facing today include hours and earnings and safety issues.
Furthermore, this was kind of funny, because as a kid I was amazed at how Amazon ships customers’ packages in the fastest and the most cost-effective way. As a kid, I remember asking my parents “How does Amazon do this?” and I remember them saying that I will need to major in a topic that will help me understand this process. Every time I ordered an item from them, I would think about the process of obtaining the packages using robots, packing the items safely, and then shipping them off to customers. This is an example of logistics and efficiency at its finest. As a junior, I still do not understand this process fully, since I am currently taking IDIS 240. But, by the time I graduate, I hope to fully understand this process.
The Home Depot Supply Chain Management model is based on integrated inventory management through a centralized network of 20 distribution centers, called Rapid Deployment Centers (RDCs) and three Direct Fulfillment Centers (DFCs) aimed at the e-commerce market (Bond, 2015). Orders are processed and managed to meet current and forecasted demands, sent to the regional RDCs, which service approximately 100 stores each, and sent to retail outlets to meet stock requirements (Bond, 2015). Direct Fulfillment Centers are e-commerce distribution systems. Home Depot delivers within a two-day timeframe to 90% of US based customers, and the system also leverages in store stock for same day pick-up (Bond,
UPS and FedEx are the leading parcel carriers in the U.S. FedEx has significantly expanded their capability to compete with UPS’s dominant ground delivery service. UPS has continued its strong marketing efforts in overnight and deferred air services. Both of these carriers have introduced information systems, which include user-friendly Internet interfaces. The carriers have also expanded logistical services and improved integration with customer supply chains.
Typical users of airfreight were producers of time-sensitive, high priced, finished goods such as valuable architecture and confidential documents. But in 1976, a spring survey shows that only 24% customers used both Courier Pak and Priority One services while less than 1% of them used only Courier Pak. Moreover, the cap...
Cost cutting; Technology plays a significant part in package delivery companies capability to assist customers in cutting their inventories which UPS owns. The UPS system processes packages using advanced information technology and are transported by the companies’ own aircraft, fleet or delivery vehicle so UPS does not rely on other companies.
FedEx Express invented express distribution as early as 1973 and till today remains the leader on the market providing rapid, reliable and time-definite delivery of packages, documents and freight within one to three business days. FedEx works in more than 214 countries serving more than 90% of the world gross domestic product through customer-cleared and door-to-door delivery. FedEx's extensive air route authorities and transportation infrastructure combined with leading-edge information technologies makes it the largest transportation company in the world. Currently, FedEx employs more than 134,000 employees operating in approximately 53,500 drop-off loc...
Business depends very critically upon Fed Ex. If Fed Ex had a major disruption to their delivery system, flowers would not be delivered on time, resulting in dissatisfied customers. For example, if Fed Ex employees went on strike, there would be no alternative equivalent to Fed Ex to deliver flowers to customers. UPS, although an alternative, did not deliver perishable products in the same timely fashion as Fed Ex.
Sustainability of the supply chain has increasingly become a crucial aspect of corporate responsibility. Apart from being good for business, management of social, economic, and environmental effects of supply chain remains the right thing to do. Constantly changing markets have created complex landscapes that businesses must navigate to build sustainable supply chains. Sustainable supply chains aim at creating social, economic, and environmental value for all stakeholders throughout the supply chain. Building sustainable supply chains not only benefits the stakeholders but also aims at safeguarding business interests. Businesses can easily become sustainable by understanding who they are and working closely with people. Nestle is company that has been at the forefront in advocating for sustainable supply through the ‘creating shared value’ platform. The report makes recommendation on the role of supply chain management in attaining sustainability.
1. Every organisation in both the public and private sector is in varying degrees dependent on materials and services supplied by other organizations (Johnson and Flynn, 2015:36-37). In your view, what role can supply play in determining an organization's strategic growth?