Fedex vs Ups

4116 Words17 Pages
QUESTIONS 1. If you had to identify one of those companies as excellent, which company would you choose? On what basis did you make your decision? More generally, what is excellence in business? 2. Prepare to describe in class the competition in the overnight package delivery industry, and the strategies by which those two firms are meeting the competition. What are the enabling and inhibiting factors facing the two firms as they pursue their goals? Do you think that either firm can attain a sustainable competitive advantage in this business? Competition in the express delivery Market The $45billion US domestic delivery market could be categorized into 2 segments. These consisted of letters weighing 0 to 2 pounds,…show more content…
The small-package market in the US is about $60bn market. The worldwide supply chain market is about $3.2 trillion. By 2003, UPS offered package delivery services throughout the US and in more than 200 countries and territories, and moved 13 million packages and documents throughout its network everyday. Domestic package operations accounted for 76% of revenues in 2002; international(15%); non package (9%). In the U, it was estimated that the company’s delivery system carried goods having a value in excess of 6% of the US Gross domestic product. The company employs 360 000 people (of whom 64% is unionized) and owned 88000 ground vehicles and 583 aircraft. At the end of 2003 UPS reported assets, revenues and profits of $28.9bn, $33bn and $2.9bn. 1. Why did FedEx’s stock price outstrip UPS’s during the initiation(Feb to June 2004) of talks over liberalized air cargo routes between the U.S. and China? Assuming a perfectly efficient stock market, how might one interpret a 14% increase in FedEx’s market value of equity? On June 18 2004 the US and China reached a landmark air transportation agreement that quintupled the number of commercial cargo flights between the two countries. At that time Fedex and UPS were the only 2 carriers then permitted to serve the vast Chinese market. News of the agreement did not come as a major surprise to most observers as the negotiations had been in place since February. The stock prices of both companies had been

More about Fedex vs Ups

Get Access