United Parcel Service - Term Paper Example

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United Parcel Service is a global package delivery service and delivers packages to over 220 countries. Delivering over 15 million parcels every day to more than 6 million customers indicate that UPS has been one of the leading package delivery services across the whole world…
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United Parcel Service
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Download file to see previous pages It is however, critical to note that the market trends may be more volatile in future to continue to offer unprecedented services. Changing consumer preferences, new technology etc can have a significant influence over the way business may perform in future. The very nature of the industry indicates that it is dominated by very few but large players which control much of the market however; smaller companies operate too to offer low cost solutions.
Though the industry is having higher government regulations because of checks and balances however, the overall competition is still concentrated. Due to lack of larger players in other countries, UPS, FedEx and DHL are the major global players in this industry. This report will provide a strategic review of UPS and will also make a comparison of its activities with other players in other countries. More specifically, this report will offer an strategic insight into different factors associated with UPS. Nature of the Product or Service As discussed above, UPS offers parcel delivery service however, over the period of time, it has been able to diversify its product ranges and is now offering a comprehensive package of logistic and supply chain services along with its basic primary service of package delivery. The overall range of services now not only includes general logistics solutions but it now offers very specific and niche market services to hospitality industry also. (Niemann, 2007) It is important to note that technology plays an important role in offering these products and services. Integrated tracking services for parcels are now an important part of the overall product life cycle of the product. It is important to note that alternative or substitute products have been in the market due to technological advancements. Earlier technologies such as fax machines have reduced the need for sending documents especially through courier services. Introduction of email has further reduced the need for sending physical documents. However, the need for other logistics and supply chain services exists but these services are not typically offered to the general consumers and are mostly B2B. It is also important to note that these services are highly price elastic in nature as presence of other players in the market more specifically makes the price competition more sensitive to the changes. Mushrooming of smaller players in the market specially those service smaller localities and communities also tend to add more to the competition and resultantly prices remain low and more sensitive to the changes across the whole market. In other countries, similar firms are mostly concentrated into the one segment of the business i.e. parcel delivery and are into the supply chain management services for the local or international firms. Market Trends One of the key parameters of consumer behavior for UPS is the seamless integration of technology with parcel and package delivery services. Consumers prefer to have their goods and packages reach at the right destination, in right time and also require real time tracking of their shipments. E-commerce and technology therefore are the biggest drivers of change in the consumer behavior in this industry. (Strategic Direction, 2003) There has been a continuous growth for the B2C market in what is called free shipping services especially in US. UPS along with other players, in order to attract online customers, continue to offer free shipping ser ...Download file to see next pagesRead More
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