Go to your Shipping Conditions and Methods area and click on "Add Method".

YourDomain.com > Modules > ECommerce: Products (Mx) > Shipping Conditions/Methods

Once you click on "add method" you will see 2 drop down boxes.  Choose the Condition you would like to apply this method to, and Choose UPS in the "Service" drop down box. (click here to see more about "Conditions")

see screenshot:

Next Click "Add"

Then you will be taken to the methods details page.  This is where you can select what type of shipping method you are going to use.

see screenshot:

Next Choose what type of Method you want to use from this service, in the "method" drop down box.  (NOTE when you change the method in the drop down the name will change as well.  You can change the Name that displays for the method if you wish)

You can additionally put customer notes here, and specify a markup if you wish.  Specifying the "Package Type" can change the estimates for your customers.  Try to pick the most accurate package type.  You also need to be sure each of your products reflect an accurate weight so the estimate is as accurate as it can be.

Shipping Markups table allows you to define a markup to be added to the value returned by the real-time shipping calculator. This is especially useful when your shipping expenses exceed the value returned by the calculator (e.g. packing, insurance etc.).

The total shipping cost formula is similar to one above: Total Shipping Cost = Real-Time Shipping Charge + [Real-Time Shipping Charge]*% of Shipping + Flat Markup + [Order Cost]*% of Total + [Number of Items Ordered]*Per Item Markup + [Order Weight]*Per Lb Markup

Real-Time Shipping Charge - shipping cost returned from the real-time shipping calculator.
Flat Markup, % Markup, Per Item Markup and Per Lb Markup are used similarly to Flat, %, Per Item, Per Lb to calculate the Shipping Charge using the formula.