United Parcel Service is reshaping its network and customer mix as it reduces its reliance on Amazon volume — a shift that executives say will allow the carrier to pursue higher-margin B2B shipments, healthcare logistics and small business customers.

During a March 4 presentation at the 47th annual Raymond James Institutional Investor Conference, UPS CFO Brian Dykes described the strategy as a structural pivot toward more profitable freight characteristics rather than a retreat from growth.

“It’s not a shrink-the-company strategy,” Dykes said. “It’s a growth strategy — but it’s a growth strategy in the places where we can drive accretive growth.”

At the center of the move is UPS’ ongoing reduction of Amazon-related package volume. Over a two-year period, UPS expects to shed roughly $5 billion in Amazon revenue and about 2 million packages per day, equivalent to roughly half of the business Amazon represented in 2024.

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UPS executives emphasize the volume reduction is deliberate. Much of the Amazon freight exiting the network consists of warehouse-proximate eCommerce shipments that Amazon increasingly delivers using its own logistics infrastructure.

“The portion of the volume that we’re exiting is really … the vertically integrated retailer, the stuff that’s really in a warehouse probably 50 miles from your house,” Dykes said. “You don’t need an integrated end-to-end network in order to move that kind of volume.”

By exiting that volume, UPS intends to redirect network capacity toward shipments that better fit its integrated transportation network — particularly B2B shipments, healthcare logistics and industrial verticals.

“Our focus is really on growing our enterprise customers, particularly in B2B and healthcare and industrial verticals where we can drive higher revenue per piece and better characteristics for our network,” Dykes emphasized.

Network Reset Underway

The strategic shift comes alongside what UPS describes as the largest network reconfiguration in its 118-year history.

Over the past year, the company closed 93 facilities and reduced significant operational capacity as Amazon volume declined. The effort will continue in 2026, with additional building closures and operational changes aimed at aligning the network with the new mix of shipments.

The goal is to emerge with a smaller but more productive logistics network.

“As we come out of the second quarter, we’ll have a more agile, more profitable network that we can grow off of,” Dykes said, noting the target mix includes “less e-commerce, more SMB, more B2B, more healthcare.”

Automation is also a key part of the reset. UPS is investing in automated sorting facilities and upgrading parts of its logistics infrastructure while reducing excess capacity tied to low-margin residential eCommerce shipments.

The shift is also expected to support improved pricing and margin performance.

In the fourth quarter of 2025, UPS reported 8.3% revenue-per-piece growth, driven partly by pricing and partly by mix improvements as lower-yield shipments exited the network. The company expects full-year revenue-per-piece growth of about 6.5% in 2026, with mix continuing to play a role early in the year.

Executives say the pivot toward B2B freight is central to sustaining that pricing momentum.

Business shipments typically move in higher-density routes and often involve more complex logistics requirements, both of which allow parcel carriers to command higher yields.

Expanding Reach to SMB Shippers

UPS is also investing heavily in tools designed to capture smaller business customers.

A major driver of that effort is the company’s Digital Access Program (DAP), which integrates UPS shipping capabilities into online marketplaces and software platforms used by small businesses.

• The program has grown rapidly — from roughly $150 million in revenue six years ago to more than $4 billion today, according to Dykes
• The initiative is aimed at helping SMBs — including many distributors and industrial sellers — integrate parcel shipping directly into their digital commerce workflows.

“It’s about being where SMB customers need us to be, integrating with their technology stack and helping enable them to punch above their weight,” Dykes said

Internationally, UPS sees SMBs as an even larger opportunity. The company says roughly 55% of its international parcel business now comes from SMBs, giving it a more diversified and margin-friendly shipment base.

What Distributors Should Watch

UPS’ B2B pivot could have meaningful implications for wholesale distributors over the next several years.

First, the carrier’s network optimization may improve service consistency and pricing stability for commercial shipments. As residential eCommerce volume becomes a smaller share of UPS’ mix, distributors could benefit from increased route density and logistics capacity tailored to business deliveries.

Second, UPS’ investments in SMB shipping tools suggest the company is positioning itself more directly inside distributor digital commerce ecosystems. Programs like the Digital Access Program are designed to embed parcel shipping directly into online marketplaces and eCommerce platforms — areas where many distributors are expanding.

Third, the company’s emphasis on healthcare and industrial verticals signals potential growth in specialized logistics services tied to regulated products, critical parts and time-sensitive shipments.

For distributors, the key question will be whether UPS’ network reset ultimately produces measurable advantages for B2B freight — including improved service performance, specialized handling capabilities or pricing advantages relative to competitors.

If the strategy succeeds, distributors could find themselves working with a parcel carrier increasingly designed around commercial shipping rather than consumer eCommerce.