UPS 2014 Annual Report Download - page 15

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The combination of rising demand for healthcare services around the globe, new product innovations, increasing
regulatory demands and downward pressure on reimbursement is creating both exciting opportunities and complex challenges
for healthcare and life sciences companies. In today’s environment, healthcare logistics executives are most concerned with
regulatory compliance, product security, supply chain cost management and product damage/spoilage. To address these
challenges, more healthcare and life sciences companies are relying on partnerships with third party logistics providers that can
provide efficient, scalable solutions that enable instant access to healthcare compliant infrastructure, provide options for
temperature-sensitive transportation and storage capabilities and have expertise in the regulatory requirements of the markets
they seek to enter.
UPS is in a unique position to offer our clients such solutions through the combination of our dedicated healthcare
transportation and distribution capabilities which sit atop our vast, global integrated transportation network and are managed by
a team of employees with healthcare logistics expertise. Over the past two years, we opened 15 new dedicated healthcare
facilities on four continents, with our most recent additions in the United Kingdom, Mexico, Brazil and Poland. In total, we
operate nearly seven million square feet of dedicated healthcare distribution space across an integrated network of 49 facilities.
These facilities allow us to provide reliable, secure and cost-effective warehousing and distribution for healthcare and life
sciences firms, which, in turn, allow them to easily navigate across and within borders.
Rapid technology innovation and growing worldwide demand for electronics are driving change in the already-dynamic
high-tech industry. As the technology marketplace becomes more complex, high-tech companies must manage and optimize
their supply chains to remain competitive. Every year, product lifecycles are getting shorter, dictating the need for high-tech
companies to better predict demand and understand their logistics requirements. Increasingly, they are looking to third party
logistics providers for support in product launches, distribution, post-sales support and reverse logistics.
We have the expertise these companies need, as well as, a global transportation network and integrated technology
solutions that can generate supply chain efficiency. This means high-tech companies, large and small, can get their products to
market faster, improve customer service and boost revenue. We offer global sourcing and a significant amount of repair space
to leverage one of the largest networks of post-sales facilities in the world. With more than 950 field stocking locations in 147
countries, we help high-tech companies identify better ways to meet their crucial logistics needs. Our experience and global
capabilities make us a strong partner in the high-tech industry.
We will continue to expand our industry-specific support by growing our physical footprint and enhancing our
technology based on our deepening understanding of industry-specific needs. Our aim is to increase the number of customers
benefiting from these solutions and gain their associated transportation and logistics business.
Logistics Outsourcing
Outsourcing supply chain management is becoming more prevalent, as customers increasingly view professional
management and operation of their supply chains as a strategic advantage. This trend enables companies to focus on what they
do best. We can meet our customers’ needs for outsourced logistics with our global capabilities in customized forwarding,
transportation, warehousing, distribution, delivery and post-sales services. As we move deeper into customers’ supply chains,
we do so with a shared vision on how to best equip our customers with transportation and logistics solutions to better serve
their customers. We integrate our technology for efficiencies, visibility and control to ensure that we execute as promised and to
provide peace of mind for our customers.
Retail e-Commerce Growth
Throughout much of the world, e-commerce growth continues to outpace traditional lines of business. Our integrated
network puts UPS in an ideal position to capitalize on the shift towards residential deliveries. We continue to create new
services, supported by UPS technology, that complement the traditional UPS premium home delivery service and address the
needs of e-commerce shippers and consignees. Our offerings span a broad spectrum that supports retailers across their value
chain, from global sourcing to distribution and returns. We offer cost-sensitive solutions such as UPS SurePost, for shipments
where economy takes precedence over speed, and feature-rich solutions, such as our UPS My Choice service that provides
consignees with revolutionary visibility and control of their inbound shipments.
UPS My Choice keeps members up-to-date on their parcels’ delivery status through proactive alerts, and offers flexible
delivery options to control when and where deliveries occur. Following on the success of UPS My Choice in the U.S. (over 13
million members), we expanded the service to 15 additional countries and territories in the Americas and Europe regions in
2014. With UPS My Choice, consignees may direct the timing and location of their deliveries before a delivery attempt is
made. We strive to give our customers the best delivery experience in the industry---delivery on the first attempt, where and
when their customers want them.