The complexity of the operation is daunting. SEMCO manufactures more than 100 different components for everything from cell phones to televisions to audio systems to computers in plants located across Asia, the Americas, and Europe, as well as Korea. The company sells more than 80 percent of its products outside of Korea.
When the system is completed, UPS subsidiaries will handle SEMCO’s housing, air transport, express services, and customs brokerage activities for all of its electro-mechanic division products, whether they are computer monitors, cell phone keypads, car speakers, or the heads that read the tape in VCRs. In all, Samsung will pay UPS up to $500 million over the next five years to do so.
Samsung is a good illustration of how UPS strives, in Pyne’s words, to “touch the customer in multiple points, to be a solutions provider versus a mere vendor of transport services.”
Indeed, as part of the deal, UPS promised Samsung that it will move shipments via the best transport link available, even if that link is run by one of UPS’ archrivals such as FedEx or BAX Global. —