Inc. (UPS) United Parcel Service - Early Information Technology Efforts

In 1986, to compete with technology developed by Federal Express, UPS launched efforts to automate door-to-door package tracking. The new technology took five years to put in place and cost roughly $1.5 billion. Throughout the late 1980s, ground shipping operations at UPS grew nearly 8 percent each year, and air shipping sales increased at an even higher rate. By 1988, sales had jumped to $11 billion; more than 2.2 billion packages were shipped that year. International sales accounted for 6 percent of annual revenues in 1989, compared to 2 percent the previous year; this growth in international activity stemmed from the addition of several countries to UPS shipping routes. The firm's tracking technology proved increasingly valuable as its reach extended across the globe.

UPS paid $11.3 million for a 9.5 percent stake in rival Mailboxes, Etc. in 1990. Service in Eastern Europe was broadened to include cities in Poland, Czechoslovakia, Hungary, Yugoslavia, Rumania, and the USSR. The firm ventured into the Japanese package delivery and air freight markets for the first time via a joint venture with Yamato Transport. Despite international losses of $200 million, total revenues reached $13.6 billion. By 1991, the firm had increased its share of the overnight delivery market to 30 percent. The following year, UPS added to its international holdings with the purchase of Beemsterboer, a Dutch package delivery company, and Star Air Parcel Service an Austrian package carrier. Next-day air services were offered to nearly all addresses in the ten provinces of Canada. In 1994, UPS established UPS logistics to offer logistics management services to businesses; this unit would prove to be a cornerstone in the e-commerce efforts undertaken by UPS in the late 1990s. The firm made its largest purchase to date in 1995 when it bought SonicAir in an effort to move into the same-day delivery market.