UPS As Customsbroker

A Student asks:

I was wondering what you thoughts were on using UPS to function as a customs broker. I was pricing PO Boxes when I noted that they had such services available.

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I recall when UPS was a regional parcel delivery company, which went national when Nixon slightly deregulated parcel delivery in USA. It was a huge change and benefit to business not to be forced into the US Post Office to ship a package across USA.

Fedex followed suit a few years later. With more deregulation in the 1980’s the emphasis switch to 3PL, or third party logistics. As the improvements in communications and transportation got better and cheaper, logistics as a competitive advantage became critical. Have cutomsbrokers and freight forwarders and the actual common carriers under one roof was a benefit to international business.

So UPS bought Fritz & Company customs brokers, Fedex bought The Tower Group brokers... and to make access even easier FEDEX bought Kinko’s to give a street level access to consumers shipping worldwide, and UPS followed suit by buying mailboxes etc.

I expect to see Fedex and Starbucks some day to joint venture in warehouse locations ... wait a minute... you just made me think of something... a business that is a warehouse to pack and ship for people... nothing new there... a coffee shop for people to meet... nothing new there... cubicle space to rent with central office equipment... nothing new there... but all in one place... that would be new... I just outlined the elements of a first-rate “business incubator” ... hmmm....

Anyway, to answer your question...

UPS is first rate... they charge a super-premium to make all the problems go away... but your job is to learn what your competitors do in the way of logistics and copy that... in every way you are the same as your competitors, except design.

And how come you are considering a PO Box...? Why add aggravation and cost? Why not simply work out of your home, and talk to your CPA about writing off part of your house, part of your phone, etc?

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