UPS elaborates on reasons for acquisition of Mail Boxes Etc
UPS, the USA-based global integrator, has elaborated on the strategic considerations behind its recently announced plan to acquire Mail Boxes Etc. (the-chain, March 5).
The latter, a subsidiary of US Office Products, claims to be the largest franchiser of independently-owned business, communication and shipping centres worldwide. Headquartered in San Diego, California, US, it comprises more than 4,300 retail locations, including nearly 900 overseas. Currently, the company has a presence in 29 countries and is continuing to expand in Asia and Europe.
UPS says the planned purchase of Mail Boxes Etc. (MBE) for $191 million in cash is in line with the company’s overall strategy of facilitating the movement of goods, information and money. “The MBE acquisition makes good sense at the right time,” comments Steve Holmes, a UPS spokesperson.
Subject to the deal being completed, the two companies plan to develop joint products to serve small businesses, e-commerce and financial markets, areas where both have a strong base targeting small business owners, walk-in retail customers and technology-connected workers. For example, says Holmes, there is a plethora of services that a sales agent with a mobile phone and other wireless devices might need. UPS and MBE also both claim to be major players when it comes to shipping and returning goods purchased over the internet in both the B2B and B2C sectors.
Ultimately, the acquisition of MBE will give UPS a significant global channel through which to reach more customers for the movement of goods (from packages to logistics programmes), information (shipment tracking, internet access, etc.) and money (commercial lending). UPS provides free internet access to businesses through its Worldlink Internet browser, while shippers using MBE might need financing to support their international trade activities.
In the latter context, UPS’s financial unit, UPS Capital, announced in January a stock acquisition of bank holding company First International Bancorp. Norm Black, another UPS spokesperson, says this bank has extensive programmes for export financing. The company is not ruling out integrating these types of service with MBE channels.
Holmes denies, though, that the acquisition of MBE is a tactical response to recent moves by FedEx and the US Postal Service to develop a partnership that involves the former placing its drop boxes at thousands of US postal offices (the-chain, March 6). “MBE will continue to operate its stores and continue to offer the full line of products which includes FedEx and other carriers’ shipping,” he states.
