When your Sprint cell phone breaks, it is a UPS employee who decides whether the phone should be repaired or tossed out. When you order a specially configured printer from Lexmark, it is a UPS employee in a UPS warehouse who installs the hardware and software. When your company's tech expert orders up service parts for your Compaq PC, a UPS facility in Kentucky ships them.
A few years back, had Ford Motor Co. wanted to cut the number of days it takes to get a new car from factory to customer, it would likely have hired a new machete-wielding manager for its vehicle delivery division. In early 2000, Ford hired UPS instead to do the job. Within a year, customers were receiving their new cars an average of four days sooner, and Ford was saving $240 million a year.
Not all UPS customers live long enough to benefit from all such services. Among the companies that signed up UPS to manage stocks and deliver orders were such dot-com conflagrations as Shaquille O'Neal's dead-on-arrival Dunk.net. And then there was Boo.com, the fashion Web site based in London.
UPS executives remain remarkably sanguine about such failures. One reason is that despite the souring of the economy, the desire by manufacturers to "outsource" such work is still growing.
Another reason is that any facilities that UPS builds to handle one company's operations will soon be available for the operations of other UPS customers. In Kentucky, for instance, the same warehouse encloses the Sprint returns operation, the AND 1 sport shoe shipping, and Nike.com.