UPS intensifies effort to attract small businesses

United Parcel Service continues to invest in winning and retaining small-and-medium businesses, a key market constituency it has targeted over two years as a profit center as it deemphasizes low-margin, final-mile deliveries for large e-commerce shippers.

On Thursday, the Atlanta-based parcel logistics giant unveiled several digital tools aimed at enhancing and simplifying the shipping experience for sole proprietorships. The updates include a new online dashboard for more control over pickups, faster label creation and a refreshed mobile app that integrates with The UPS Store.

The new pickup dashboard centralizes pickup scheduling, management and tracking in one location and allows customers to adjust pickup schedules based on when shipments are ready, rather than having a fixed schedule. With the “Smart Pickups” feature, businesses can save up to 50% over the cost of a daily pickup, UPS said in a news release.

A single-view of shipment details and service options simplifies label creation to help reduce repetitive data entry and speed fulfillment.

UPS management has centered its growth strategy around industry verticals — small businesses, healthcare, automotive, B2B — that require more complex logistics services for which they can charge a premium compared to simply transporting an online order from a local warehouse to a residential doorstep.

Towards that end, it relinquished the handling of 2 million packages per day from Amazon and is in the process of downsizing its delivery network to align with lower volumes. Small-business package volumes grew 4. 3% during the second quarter, year over year, the company said Tuesday in an earnings report.

In the first quarter, when average daily volume increased 1. 6%, SMBs made up 34. 5% of total U. S. domestic volume, marking the highest small business penetration in the company’s history, and 60% of volume in Canada. “SMBs are critical to UPS.

Often the revenue per piece is higher and helps optimize daily van capacity with smaller pickup areas in the driver’s return route,” said parcel consultant Mark Waverek, in an email exchange. Smaller companies often are unable to get deep shipping discounts that large shippers negotiate with carriers, making UPS a default choice for many of them.

Reducing common friction points and providing reliable nationwide service helps UPS attract smaller firms, he explained. The digital shipping upgrades “are table stakes for modern shipping platforms.

Every major carrier and most multi-carrier shipping software providers have been investing in similar capabilities for years,” but they demonstrate UPS strategy for customer acquisition, said Gerryann Agovino, head of marketing and strategic partnerships at LJM Group.

Why It Matters: UPS and FedEx have made small enterprises a strategic focus because they represent higher quality revenue than e-commerce last-mile deliveries.

RELATED STORIES: UPS shift away from Amazon shows bigger payoff New UPS tool helps online shoppers calculate import fees before buying FedEx to implement single pricing structure for express, standard pickups The post UPS intensifies effort to attract small businesses appeared first on FreightWaves.