UPS announced on Tuesday its second-quarter 2021 consolidated earnings with revenues of $23.4 billion, a 14.5% increase over the second quarter of 2020.
Frankly, the financials are only interesting for investors, and the UPS Investor Relations website has all the relevant Q2 2021 details.
However, we like to dig into the earnings call transcript that accompanies financial reports to learn more about topics that we think are interesting for small businesses and online merchants.
And there were a few interesting topics addressed in the call:
- Parcel Volume
- Saturday Delivery Expansion
- Insurance Claims
- Impact of Small Business Shippers on UPS
- Preparations for Holiday Season
- Impact of Large Shippers on UPS Holiday Season
- B2B Shipping Rebound Due to Retailers Seeing More Foot Traffic
The following quotes are from Carol Tomé, CEO, UPS.
“As we expected, U.S. average daily volume for the quarter was down slightly from one year ago, driven primarily by tough comparisons due to the jump in ecommerce related volume last year.”
Saturday Delivery Expansion
“During the second quarter, Saturday Ground delivery volume grew 13%, as we continued expanding our weekend coverage.”
“We are currently halfway through our efforts to expand our existing centers and turn on Saturday operations in more than 200 additional centers.”
“By the end of October of this year, we will cover about 90% of the U.S. population on Saturdays.”
“We are expanding [Saturday] services in over 500 buildings, existing and new.”
“One of the customer pain points we are addressing is claims. We recently completed a successful pilot that shortened the average claim processing time from 20 days to five.”
“We are rolling out our new claims process to all U.S. SMB customers over the next 12 months.”
Impact of Small Business Shippers on UPS
“Last year, SMBs in the United States made up about 20% of our total revenue. This year, they make up more than 27% of our total revenue.”
Preparations for Holiday Season
“We need to hire a lot of people for peak. And I’m happy to say that even in the face of this tight labor market, we are ahead of where we were a year ago.”
“We are lining up the aircraft that we need to lease to manage the volume. We’re lining up on the rental equipment that we need to have in place to handle the volume.”
Impact of Large Shippers on UPS Holiday Season
“There are about 300 customers, who make up that peak volume surge, and we’re sitting down with each of them, understanding what their projections, what their promotions are, how are they thinking about the holiday season and really trying to work with them so that we provide to them the same outstanding and excellent service that we gave to them last year.”
The following quote is from Brian Newman, CFO, UPS
B2B Shipping Rebound Due to Retailers Seeing More Foot Traffic
“B2B volume increased 25.7%. All industry sectors grew B2B volume, led by retail as more foot traffic returned to the brick-and-mortar locations.”
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