UPS to lay off workers at trade management subsidiary as business declines

Dive Brief:

UPS will lay off employees at a subsidiary providing global trade management services due to declining business, according to a Worker Adjustment and Retraining Notification (WARN) Act notice dated March 24.
Around 82 employees at the Southfield, Michigan, headquarters of Sandler Travis Trade Advisory Services will be laid off. Affected positions including senior customs brokerage representatives and trade management analysts, the notice says.
Separations begin on May 31 and run through Aug. 31, after which the facility will permanently close.

Dive Insight:

The delivery giant determined the move was necessary in order to "create an even stronger UPS" as global demand slows, spokesperson Matthew O’Connor said in an emailed statement.

"We are committed to running a highly efficient and resilient business model, especially in the face of choppy macro conditions," O’Connor said. "With that in mind, we are simplifying our trade advisory portfolio to focus only on core services for our customers, and have made the difficult decision to eliminate some positions."

UPS' Supply Chain Solutions segment, which includes international trade and brokerage services, saw a 5.7% YoY decrease in revenue last year. This was fueled by the divesting of UPS Freight as well as volume and market rate declines in forwarding, according to UPS' annual financial report. Additionally, compensation costs increased in the segment by $95 million due to business growth and inflationary pressures.

The layoff announcement follows the integration of STTAS' trade advisory services into UPS' portfolio on Feb. 27, according to a notice on STAAS' website. The notice said representatives will reach out directly to clients to discuss migration plans as applicable.

UPS acquired STTAS in 2017. A news release at the time said STTAS had 750 trade professionals helping clients comply with international trade regulations throughout the world. Nearly 70% of its employees worked outside the U.S. then.

“UPS customers tell us they are looking for a full suite of brokerage services, including trade management and advisory services, from a partner that can help them on a global basis,” said then-UPS International President Jim Barber in a statement.