In its bid to expand its full supply chain services, UPS recently finalized the purchase of freight brokerage company Coyote Logistics. Founded in 2006, Coyote Logistics reported an annual revenue of $2.1 billion last year, with sales growing at a 50% pace annually over the past six years. Previously, the only truckload brokerage offered by UPS was handled through services at its freight department.
With this acquisition, UPS will now have access to Coyote’s 12,000-plus customers, as well as the company’s strong management team and large carrier network, which includes over 35,000 trucking companies. This will enable UPS to expand its freight footprint without having to make costly capital investments, such as the purchasing of buildings and truck fleets, normally associated with such aggressive industrial expansion. The shipping giant can now move some of its customers out of the traditional UPS freight network and into a more brokered environment without sacrificing capital or quality of service.
With its enlarged infrastructure, UPS now has an optimum opportunity to fill up its freight network with profitable packages, and thus, the company is eagerly targeting businesses that can utilize its newly expanded freight network capabilities. UPS wants to be a full supply chain service business. Acquiring Coyote means UPS is tapped into brokerage and full management, strengthening two important pieces of the supply chain service and helping UPS break free from being seen as merely a small parcel shipping company.
But what does this mean for shippers? Well, this could mean a great savings opportunity.
If you ship freight and LTL across all modes and in large volume, you’re just the sort of customer UPS is looking to reign in, and UPS is prepared to offer very competitive rates to gain your profitable business. You can get pricing leverage on your small parcel delivery based on the scale of freight and LTL shipping you conduct with UPS. As the leader in transportation audit and recovery solutions, Intelligent Audit will help you manage that scale by analyzing your entire supply chain and finding ways to leverage UPS’s expansion to improve your overall freight spend. If you’ve been brokering somewhere else, or even with Coyote, now is the time to contact the spend management consultants at Intelligent Audit. Contact us today!
Intelligent Audit provides its clients with a global, all-mode transportation audit, recovery, freight payment, and business intelligence reporting partner.