World’s largest logistics company and courier service provider. Colombia is one of UPS’s most important markets. Health care and exports are key components of the expansion.
A company’s success depends on its ability to handle logistics tasks such as transport, storage, distribution, and everything else related to logistics.
One of the most important companies in the world in this industry is an international company with more than 100 years of history in Colombia.
I would like to introduce you to UPS (United Parcel Service), which has been operating in the Colombian market for the last three decades.
It is worth noting that UPS was able to sell $61,000 million worldwide in 2016 and had already achieved US $15,000 million in sales in the first quarter of the current year.
Market growth in the logistics and messaging sector is expected to continue
To streamline the administrative, financial, sales, and customer management processes in Bogota, the company began working directly from Colombia (previously through a representative).
Ecuador, Peru, and Bolivia are also served from this location, as well as markets in Ecuador, Peru, and Bolivia.
Among the firm’s most recent commitments to the country has been the construction of the facilities in the San Diego industrial park in Funza, a small town in the country’s center.
As a result of this initiative, there is an expectation that a comprehensive package of services will be consolidated for companies that produce medicines and medical devices that will provide these companies with the services that they need.
This line of business is one of the strongest for UPS in most of the 200 countries in which it operates, according to Francisco J. Ricaurte, general director for Colombia, Ecuador, Peru, and Bolivia at UPS.
Having these facilities in Colombia increases the competitiveness of the contract logistics segment, which means that it can offer inventory management and distribution services that facilitate the management and distribution of inventory.
Additionally, these facilities are available in other markets that do not only cater to pharmaceutical companies but to high-tech firms that have these needs as well.
Furthermore, they can provide services to high-end retail companies and government agencies in other countries as well.
San Diego’s park invests most of its resources in facilities that support health care, medications, and medical devices at the beginning of the project.
Engineering works for the construction of these new facilities began at the end of 2015, and by November 2016, the work in these new facilities had been completed. This new project was launched in May last year, and this is the first step in its development.
As Ricaurte explains, “This implies a huge benefit to our clients in this area (which includes the world’s most important medical laboratories) since Colombians currently do not have access to providers of these services with a global network that applies the same standards to all the countries where it operates”, which is the case in Colombia.
As a result of this, the same laboratory would be able to request UPS to pick up a product from any country in Europe or the United States and deliver it to these new facilities in Colombia.
This implies not only that the product will be transported safely and efficiently, but also that the proper procedures will be followed when it comes to customs and other logistics.
There has not been a simple solution for bringing imported medicines from any region to a local transport company, which had to hire registration land transport in the country of origin, deal with customs procedures and deal with shipping and storage with different agents if it wanted to do so.
Ricaurte continues, “Now, all we have to do is hire those services with us, and we will take care of everything for you.”
It is important to note that UPS currently has these facilities in Puerto Rico, Mexico, Argentina, Chile, and Brazil as well.
There is no doubt that package messaging is the core of UPS’s business. In Colombia, TG Express, a local agent of the company, has been operating for over 30 years.
They changed their policy five years ago, and now they only outsource the collection of parcels and local deliveries to third parties.
The Colombian firm Deprisa was engaged by the company to assist it in this regard.
These types of companies, by offering this type of service, can be used as a good indicator of how foreign trade will behave in the countries where these types of companies are established.
In his comments, Ricaurte points out that Colombia’s export trend has been increasing in recent years, even though the numbers are not yet excessive.
There is a large portion of the flower producers and exporters from Colombia who count on UPS for shipments from Colombia abroad to their clients.
The export of Colombian services is heavily reliant on the sale of perishable goods," he explains, adding that it is interesting to observe the trend that is being observed in certain non-traditional products that are becoming increasingly popular in foreign markets. As an example, he highlighted the use of plant stems, aromatic herbs, buffalo cheeses, and fresh fish in his menu.
Two other aspects of UPS’s service portfolio make up the UPS service portfolio, and they are freight forwarding, also known as freight forwarding, and air cargo transportation. According to Ricaurte, both of these fronts are exhibiting good results, too.
According to him, Colombia is a country with stability and economic growth for decades, with a substantial population, and has had decades of sustained economic growth.
For facilities specializing in pharmaceutical products, Ricaurte explained that there will be greater demand for medicines in Colombia than in most other countries, for two reasons.
It is important to note that there has been significant growth in the elderly portal user population, and this type of user requires more medications.
Another aspect of signing up is that they see Colombia as an important medical tourism destination. Funza’s facilities have expanded because of this.
“There is a lot of optimism in my opinion about the future of Colombia and the history of UPS here is the same. We are expecting to grow by two digits this year after attaining one-digit growth in 2016,” says the company’s director.
A rise in the dollar’s value is the factor that has most changed the balance because the devaluation of the peso has encouraged exports while reducing imports. It is important to note that there has been an impact on the import of high-tech products in the last two years due to the increased cost of bringing in this kind of equipment today as compared to two years ago.
UPS is committing to centralize its operations in Bogota for the next five years and to invest in new facilities that will allow UPS to provide services to the world’s largest pharmaceutical companies, showing how far the country has come in just a short time. A move like this comes at the perfect time.
Comparison of Colombia’s economy with those of other countries
There are four UPS offices in Colombia, Peru, Ecuador, and Bolivia, headed by Francisco Ricaurte. He is in charge of UPS operations in these four countries.
As a result, we can gain a fuller understanding of what goes on with the productive apparatus in those countries. The economy of Colombia is, in his opinion, the most powerful and largest among this group of countries.
There is a need to improve road infrastructure as well as to make some other investments in the modernization of Colombia’s airports and ports even though it is clear that there is still a need for improvement.
There has been an improvement in the country’s services in the area of customs, according to him. Even though Ecuador has a smaller economy than the United States, it is strong because it exports many perishable items, which means there are many business opportunities for UPS in Ecuador.
There has been an impact on import rates in Peru as a result of the devaluation, as there has been in Colombia. As far as UPS is concerned, it still operates through an agent while its cargo unit still has a representative in Bolivia.