UPS Adopts Control Tower Process to Cope With Holidays

United Parcel Service Inc. (UPS) is anticipating an 11 percent spike in shipments during the December crunch and said this time it’s ready to handle it.

The world’s largest package-delivery
company said it will keep a closer watch on its biggest customers and will even impose a surcharge for excessive volumes.

UPS is trying to avoid a repeat of last year, when unseasonably cold and snowy weather combined with a surge in late, online orders and overwhelmed its ability to process packages, leading to missed deliveries on Christmas. It vowed to perform better.

Measures Atlanta-based UPS is taking include implementing a “control tower” process, which entails comparing big retail customers’ actual shipping volumes to those they originally projected, and going back to them to “mute” their demands if volumes get too high, Myron Gray, president of U.S. operations, told analysts on a conference call.

UPS’s forecast for December deliveries follows FedEx’s prediction this week of record shipments of packages between Black Friday and Christmas Eve. Memphis, Tennessee-based FedEx sees an 8.8 percent increase from last year, as e-commerce hits a peak.

UPS plans to spend $175 million on improving its operations during the holiday rush. It’s opening 14 temporary shipping facilities to help expedite deliveries, upgrading its Orion software to plot the best route for drivers, and is hiring as many as 95,000 seasonal workers to field packages.

Supply Chain Control Tower
Supply Chain Control Tower

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