UPS testing new bare-bones service that will use U.S. mail system

<p>United Parcel Service Inc. later this month will test a bare-bones service catered to select companies, including direct marketers, that will in some cases use the U.S. Postal Service to deliver packages to rural locations.</p><p>The worlds largest shipping carrier said Thursday UPS Basic is its attempt to draw in new customers _ people who generally dont use its services to deliver 1- to 5-pound packages and are interested simply in a low price. UPS Basic will not include any of the extra services that the company generally offers, like tracking and a guaranteed delivery day.</p><p>The initiative will take advantage of a U.S. Postal Service program called Parcel Select that offers sharp discounts to people or companies that sort and deliver items to the post office nearest to the items final destination, at which a U.S. Postal Service mail carrier delivers it the rest of the way.</p><p>UPS rival FedEx Corp. has been testing a similar service on a limited basis, FedEx spokesman Eric Jackson said.</p><p>Atlanta-based UPS actually plans to deliver most of the UPS Basic packages directly to the recipient, but in some cases will act as the middleman, or consolidator, in the U.S. Postal Service discount program, spokesman Norman Black said.</p><p>This is not ever going to be a general offering, Black said. Its a specialized contract-only service that were testing to see if it allows us to attract business that today escapes us.</p><p>Black said UPS for some time now has had a subsidiary, UPS Mail Innovations, that has acted as a consolidator.</p><p>What were trying to test is whether or not we can develop a product that is inexpensive enough that the customer will give us a try knowing most of the volume will be delivered by UPS, Black said. A small percentage will go into the postal system.</p><p>UPS would not say how much its new service will cost, but Black indicated it will not necessarily be less than what current consolidators charge.</p><p>We dont know if this is going to go anywhere, Black said. This is an innovative way to attract new business doing exactly what were allowed to do under the post offices work-share programs.</p><p>U.S. Postal Service spokesman Gerald McKiernan said it is too early to tell if it will lose customers to the UPS Basic service. But, he said, theres nothing wrong with what UPS is doing.</p><p>It really doesnt matter, by that I mean we deliver for everyone, McKiernan said. What could we do about it if we had concerns? We service all customers who provide mail to us.</p><p>McKiernan said the U.S. Postal Services Parcel Select program started five or six years ago. At the time, there were two consolidators and today there are 21, he said.</p><p>One group that isnt happy about the new UPS initiative is the companys own Teamsters union.</p><p>The International Brotherhood of Teamsters recently filed a notice of its intent to pursue a grievance against UPS, Teamsters spokesman Bret Caldwell said. The Teamsters say the UPS Basic program would use nonunion workers to pick up and deliver packages. They say that violates their union subcontracting agreement with UPS.</p><p>___</p><p>On the Net:</p><p>HASH(0x2870778)</p>

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