World Trade - November 2008 - (Page 33)

TRADE FINANCE Marrying Trade Finance and Transportation into a Single Transaction Launch of Cargo Finance product is the ‘Holy Grail’ for UPS Capital. BY NEIL SHISTER, EDITORIAL DIRECTOR I t is early afternoon in the late days of summer at UPS Capital headquarters, in suburban Atlanta. Outside, the creek bed winding through the lushly wooded corporate campus runs dry, evidence of the multi-year draught plaguing the southeast. Inside, Bob Bernabucci, the President of UPS Capital, seems oblivious to the weather as he chats with a visitor in his unexpectedly spartan ofﬁce (although, upon further reﬂection, I decide that within UPS Capital culture ‘utilitarian’ is probably the supreme compliment). lon We’re discussing the long awaited, m much much heralded Cargo F Finance serv vice vice that UPS Capita has been Capital l launching—admitte launching—admittedly in fitsa and-starts—over th and-starts—over the past year. i “How important is it to UPS Wi Capital?” I ask. Without pausing to consider his answer, he decisive responds decisively: “It’s the Holy Grail!” In evolving from the AmerCo ican Messenger Company into globa a $50 billion global giant, UPS cu morphed into its current iteration tion a while back. While the co company continue to make continued its t its money delivering packages, it was its was re-positioning itself to be in th ‘synchr the business of ‘synchronizing’ the supp sup ly chain. “As UPS mansupply agement saw it,” reads ag Chris Vukas, Senior Managing Director of Global Supply Chain Finance the ofﬁcial history for the decade of the ‘90s, “the company’s expertise in shipping and tracking positioned it to become an enabler of global commerce, and a facilitator of the three ﬂows that make up commerce: goods, information, and capital.” One result of this strategic vision was the formation of UPS Capital, founded in 1998 with a mission to provide a comprehensive menu of integrated ﬁnancial products and services that enable customers to grow their business (and thus ship more). With global commerce continuing to expand exponentially—and with it, UPS international shipments—trade ﬁnance plays an increasingly important role in the mix. Which is why I’ve come to Atlanta, to spend ‘a day in the life of a trade ﬁnance banker’ at UPS Capital in the trade ﬁnance space. The thing you pick up quickly, getting a guided tour of the UPS corporate headquarters elegant stone-and-glass corporate lobby complete with a model of the founder’s original Model T, is that UPS is a company that puts a huge stake in its history. In self-conscious contrast to the glitz of razzle-dazzle branding that distinguishes most corporate marketing these days, the image projected here is as stolid as the signature brown of their package delivery cars. The future, as it were, is made up here not of quantum leaps but rather steady, incremental, measured steps. Cargo Finance, on the other hand, is nothing if not a radical proposition. In its essence, it offers UPS customers the possibility of a unique trade ﬁnance solution in return for (what UPS hopes will prove) a sustained relationship in which shipping transportation becomes, instead of a price-driven commodity, the cornerstone in a collaborative ‘ecology’ of vendor, buyer and UPS. “What we really believe is that global trade has been optimized to the physical movement of goods. It’s gotten better and better.” Chris Vukas is speaking, Sr. Managing Director of Global Supply Chain Finance, the man responsible for launching Cargo Finance. A New Jerseybased banker before transplanting to UPS Capital in Atlanta some half-dozen years ago, Vukas presides over a multi-disciplinary team—sales, legal, credit, IT—charged with taking the service from concept to market. “But there’s a huge opportunity on the ﬁnance side. Why is WWW.WORLDTRADEMAG.COM 33 http://WWW.WORLDTRADEMAG.COM

Table of Contents Feed for the Digital Edition of World Trade - November 2008

World Trade - November 2008 Contents Unexpected Responses to Unanticipated Change Reading the States of Risk in Today’s Global Economy Supply Chain Watch Tradewinds Failed Promise: Mexico and NAFTA, 15 Years Later The Short Tale Marrying Trade Finance and Transportation into a Single Transaction Trucking Gets a Double Whammy Are We Safe Yet? Logistics Resurrects the Rust Belt Keep on Compressing

World Trade - November 2008

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