Uline’s mission is to offer its customers the finest quality and best selection of products with the quickest service in the industry.
Couple Richard and Elizabeth Uihlein were residents of Wisconsin who felt that their neighborhood needed a distributor of shipping supplies such as boxes. So in 1980 they founded a company for this purpose from their basement, called Uline. Its first product was a carton sizer called the H-101. It was their only product for some time, but it was a huge success, selling far beyond their expectations.
The strong performance of the offering encouraged the team to expand their portfolio by adding many more shipping supplies. They then diversified by moving into various other product lines. With their progress they added more staff, growing to 5,000+ people. Uline now distributes a wide range of shipping, packaging, industrial, and janitorial items, including the H-101, which is still on shelves.
Business model of Uline
Uline has a mass market business model, with no significant differentiation between customer segments. The company distributes products to companies across industries and sizes.
Uline offers five primary value propositions: accessibility, convenience, pricing, risk reduction, and brand/status.
The company creates accessibility by offering a wide variety of options. It publishes a catalog with 600+ pages that lists its portfolio of over 31,000 products in several categories. The catalog reaches firms nationwide. Uline increases access to products themselves by maintaining 11 distribution centers across the United States, Canada, and Mexico that offer quick delivery. Lastly, the company provides more than 1,400 box sizes at each location, accommodating different product types.
The company offers convenience through its shipping practices. If customers order by 6:00 p.m., their orders ship the same day. Approximately 99.5% of its orders ship same-day with no back orders.
The company offers a pricing value proposition. Its buyers conduct worldwide searches for product varieties with competitive prices. Also, it keeps shipping costs low through fast delivery, which minimizes freight costs. Lastly, Uline’s websites offers free products (e.g., sports apparel and appliances) to customers who spend above a certain amount, and offers many regular discounts.
The company reduces risk through a policy it calls the “Uline Guarantee.“ It allows customers to try any item it distributes for a full 30 days. If customers are not 100% satisfied, they can return it to Uline for credit or a no-hassle refund.
The company has established a strong brand due to its success. It bills itself as the top distributor of industrial, shipping, and packaging materials to businesses in North America. It has over 5,000 employees working in distribution centers in the United States, Canada, and Mexico. Lastly, it has won a number of honors, including recognition as one of America’s Best Mid-Size Employers by Forbes (2016) and a Vertex Innovation Award recognizing its technology innovation (2015).
Uline’s main channels are its website and its mail-order catalog. The company promotes its offering through its social media pages and advertising.
Uline’s customer relationship is primarily of a self-service nature. Customers use its products while having limited interaction with employees. The company’s website provides answers to frequently asked questions. That said, there is a personal assistance component in the form of 24x7x365 phone and e-mail support.
Uline’s business model entails distributing a wide range of products to consumers.
Uline’s key partners are the suppliers who provide the products for its portfolio. The company maintains a portal called “Uline Partners” through which they can monitor their business.
Uline’s main resources are its network of distribution/shipping centers throughout North America. There are 11 in total, situated in the following locations:
- Atlanta, GA
- Chicago, IL
- Dallas, TX
- Edmonton, AB
- Los Angeles, CA
- Mexicali, MX
- Minneapolis, MN
- Monterrey, MX
- NYC / Phila
- Seattle, WA
- Toronto, ON
Uline’s has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions.
Its biggest cost driver is likely cost of revenues, a variable expense. Other major drivers are in the areas of sales/marketing and customer support/operations, both fixed costs.
Uline has one revenue stream: revenues generated from fees it charges suppliers for the delivery of their products to its customers.