UPS SurePost volume shifts away from US Postal Service, Teamsters say

[jsthere723]

Do you know why they went down today?

They decided to cut by 50% the amount of Amazon packages they will accept.
That along with ending SurePost is a cost saving venture projected to save them 1 Billion dollars.
Short term revenue goes down but losses go down or profits go up...
BY WHAT?????
By cutting dependence on Amazon.
Apparently UPS figured out, "Where Going There Anyway" as a rational to make sweetheart deals with Amazon is a stupid policy that costs them money.
And apparently, they expect to be more profitable by reducing reliance on Amazon.
Ancient Chinese Proverb "A journey of a thousand miles begins with a single step"
This is why UPS is always (at least) one step ahead of the post office, they are willing to change and take a step in the right direction

All the Wall Street analysts couldn’t figure it out like you did

 

[MrMagoo]

Investor's Business Daily
Axios
Barrons
Seeking Alpha
Wall Street Journal
Kiplinger
MSN...
All wrote about this.
But you probably know something "ALL the Wall Street analysts couldn't figure out"

 

[MrMagoo]

All the Wall Street analysts couldn’t figure it out like you did

https://www.investors.com/news/ups-stock-ups-earnings-amazon-retreat/

 

[MrMagoo]

All the Wall Street analysts couldn’t figure it out like you did

Why UPS Says It's Cutting Amazon Business​

On an earnings call, UPS CEO Carol Tome explained how the "deliberate" shift away from Amazon would eventually benefit her company and its shareholders.

"Amazon is our largest customer, but it's not our most profitable customer," Tome told analysts. "Its margin is very dilutive to the U.S. domestic business."
She described small packages as a "slow growth" market. Tome said: "The result of this change will be lower overall volume levels but an improved customer mix at a significantly higher revenue per piece."

The move also reduces customer "concentration" risk and will lower fixed costs to support those volumes, Tome said. So when the Amazon contract came up for renewal, the company decided to "accelerate the glide down" of deliveries for the e-commerce giant, a customer for nearly 30 years. "Because if we take no action, it will likely result in diminishing returns," Tome added.

Combined, the Amazon and USPS actions will lead to a more profitable and agile UPS "that is growing in the best parts of the market," Tome said, according to a FactSet transcript of the Q4 earnings call.

 

[jsthere723]

Investor's Business Daily
Axios
Barrons
Seeking Alpha
Wall Street Journal
Kiplinger
MSN...
All wrote about this.
But you probably know something "ALL the Wall Street analysts couldn't figure out"

No I don’t . But proof is in the pudding. More of them sold than bought. Price drop says that

 

[jsthere723]

Why UPS Says It's Cutting Amazon Business​

On an earnings call, UPS CEO Carol Tome explained how the "deliberate" shift away from Amazon would eventually benefit her company and its shareholders.

"Amazon is our largest customer, but it's not our most profitable customer," Tome told analysts. "Its margin is very dilutive to the U.S. domestic business."
She described small packages as a "slow growth" market. Tome said: "The result of this change will be lower overall volume levels but an improved customer mix at a significantly higher revenue per piece."

The move also reduces customer "concentration" risk and will lower fixed costs to support those volumes, Tome said. So when the Amazon contract came up for renewal, the company decided to "accelerate the glide down" of deliveries for the e-commerce giant, a customer for nearly 30 years. "Because if we take no action, it will likely result in diminishing returns," Tome added.

Combined, the Amazon and USPS actions will lead to a more profitable and agile UPS "that is growing in the best parts of the market," Tome said, according to a FactSet transcript of the Q4 earnings call.

And also UPS is claiming that they have cut ties with USPS !! As if nothing to do with USPS cost change . Gimme a break!

 

[MrMagoo]

No I don’t . But proof is in the pudding. More of them sold than bought. Price drop says that

Well they (Wall Street Analysts) all explained it, and the UPS CEO explained it. Short term revenues will drop to in the long term increase per package profits.

This was, and still is my opinion even before UPS came to a similar conclusion.

M

Thread 'Can We Be Real'

Dec 29, 2024

Can We?
There was a thread about the idea the Post Office could/should be privatized.

What should really be considered is going back to the Post Office of 40 or 50 years ago with todays automation.

40 to 50 years ago the Post Office wasn't really seeking and definitely not promoting parcel delivery.

The Post Office is a Constitutionally enumerated Government function. I don't believe It was ever intended to subsidize private business with cheap delivery options.

Is it a coincidence the push to be a parcel delivery service, with the advent of Priority Mail got really rolling when the...

• MrMagoo
• Replies: 66
• Forum: General Discussion

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[MrMagoo]

And also UPS is claiming that they have cut ties with USPS !! As if nothing to do with USPS cost change . Gimme a break!

Do you need me to translate?
They no longer want to offer volume discounts that limit their ability to handle full cost customers.
As far as UPS SurePost, UPS handled the package through their entire sorting system and then delivered that package to within miles of it's final destination while losing a percentage of the fee paid to them for the last mile. The article spelled out their plan. They will handle fewer packages BUT COLLECT THE FULL PRICE.

Apparently, the Last Mile nonsense is bad for everyone.
It's killing the post office.
Fed Ex saw the light and ended the last mile relationship with the post office
Amazon has developed it's own delivery service. They never would have done that if the last mile deal with the post office was utopia. We were only a bridge to this point.
Now UPS has ended it's last mile deal with the post office.
Again money talks, and all the Money people have decided Last Mile is a bad deal for all parties involved
I get it this contradicts your world view, but if you FOLLOW THE MONEY, with even a little intelligence you can figure out what is going on.

 

[jsthere723]

Do you need me to translate?
They no longer want to offer volume discounts that limit their ability to handle full cost customers.
As far as UPS SurePost, UPS handled the package through their entire sorting system and then delivered that package to within miles of it's final destination while losing a percentage of the fee paid to them for the last mile. The article spelled out their plan. They will handle fewer packages BUT COLLECT THE FULL PRICE.

Apparently, the Last Mile nonsense is bad for everyone.
It's killing the post office.
Fed Ex saw the light and ended the last mile relationship with the post office
Amazon has developed it's own delivery service. They never would have done that if the last mile deal with the post office was utopia. We were only a bridge to this point.
Now UPS has ended it's last mile deal with the post office.
Again money talks, and all the Money people have decided Last Mile is a bad deal for all parties involved
I get it this contradicts your world view, but if you FOLLOW THE MONEY, with even a little intelligence you can figure out what is going on.

It’s whack a mole situation going on with all parties involved . In my office ( I can’t say for nationwide ) the package volume is about 10% up . It has to come from somewhere with new game plan in place for everyone. As far as I can tell for my office new strategy in place is working. Time will tell for nationwide . I cannot spell it out for you more than this right now

 

[MrMagoo]

It’s whack a mole situation going on with all parties involved .

UPS over 91 Billion Revenue yearly
Amazon over 574 Billion Revenue Yearly
Fed Ex over 87 Billion Revenue Yearly

Sorry these companies don't make policy by "Whack a Mole"

Economic education is not what it used to be!!

 

[jsthere723]

UPS over 91 Billion Revenue yearly
Amazon over 574 Billion Revenue Yearly
Fed Ex over 87 Billion Revenue Yearly

Sorry these companies don't make policy by "Whack a Mole"

Economic education is not what it used to be!!

Sure it’s not

 

[Surprise!]

I'm wondering if a "postagedue" scan wouldn't be warranted. I mean, we have to handle the parcel(s) on the street and the clerk(s) have to figure out the postage rate(s) and then we charge the offending carrier(s) the appropriate rate(s) as postage due. Hmmmmmmmmm.............

In my Post Office the carriers took their sweet time to pick up their mail. I think they also should be charged for storage.