Preview

FedEx Vs UPS

Powerful Essays
Open Document
Open Document
799 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
FedEx Vs UPS
FedEx vs. UPS Investment Recommendations

Cases: The Battle for Value, 2004: FedEx Corp. vs. United Parcel Service, Inc.

Joshua Kellam
M03856832

Dr. Phelps
1/25/14

Executive Summary:

The following document provides a review of FedEx Corp and United Parcel Service from there founding through 2003. The problem presented is whether to invest in FedEx or United Parcel Service before the expected market growth resulting from an air-transportation agreement established between the United States in China to go in effect in 2004. Both companies’ histories of product and service offerings were reviewed from a non-financial historical perspective first. After a thorough knowledge of both companies was attained a performance evaluation was reviewed. The evaluation addressed many metrics for both the individual companies and the market including but not limited to: earnings per share, market values, Returns, Economic Value Added, and Market Value Added. The primary objective when reviewing these materials was to observe historical company and market trends, especially when these companies entered new markets and/or provided new services. The possible outcomes of this review are to invest in FedEx, invest in United Parcel Service, or to invest in neither.

The following options were assessed:

Invest in FedEx: FedEx is a strong company specializing in express air courier services. They already have a dominating presents in China in relation to direct competitors and have a more fixed cost structure

Invest in UPS: UPS is a strong company specializing in courier efficiency more directly with non-air forms of transportation. UPS has a strong value based financial history and notable success with sustainable international expansion.

It is recommended it invest with UPS as it will yield greater shareholder value though it may not be immediate.

Situational Analysis:

UPS and FedEx are two large companies competing for market share in
Continue Reading
View Writing Issues

You May Also Find These Documents Helpful

  • Satisfactory Essays

    Ups Case
    • 299 Words
    • 2 Pages

    Ups Case

    UPS’s business focuses primarily on time-definite delivery of packages across the globe. It ranks amongst the world’s largest package delivery company and is a leading global provider of specialized transportation and logistics services. Also the importance of the tracking system can be listed as follows:…

    • 299 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Powerful Essays

    GSCM 588 - Major Paper Outline UPS
    • 956 Words
    • 4 Pages

    GSCM 588 - Major Paper Outline UPS

    Founded in 1907, UPS is the world's largest package delivery company and a leading global provider of specialized transportation and logistics services. Using advanced technology, access to global resources, and an integrated network of physical, technological, and human assets, UPS provides a powerful competitive advantage that can help you earn repeat customers and grow your business.…

    • 956 Words
    • 4 Pages
    Powerful Essays
    Read More
  • Good Essays

    Fed Ex vs. Ups
    • 703 Words
    • 3 Pages

    Fed Ex vs. Ups

    The two companies I have decided to discuss in this term paper is Federal Express (Fed Ex) and United Parcel Service (UPS). Both of these companies are logistic companies which specialize in delivering freight, cargo, and shipping services. Both of these companies cater to customers by making door to door deliveries locally and internationally. Both companies have both ground and air shipments but their prices do vary. UPS on the other hand allows their employees to form unions and this means employees of the latter have some advantage when it comes to salary increases, retirement benefits and other employee benefits that are enjoyed by other employees from other companies. Both FedEx and UPS have the same shipping options which are done through air and by land. However, when it comes to land transportation, UPS is leading due to the fact that the ground services offered by UPS are 5 times larger than that of FedEx. On the other hand, when it comes to shipment via air, FedEx is the leader. Statistics have shown that FedEx gets 25% more air shipments than UPS does. When it comes to rates, both of these companies vary in prices by just a dollar or a few. Some of the services they offer have the same rates as well. But just recently, both these companies have adjusted their pricing scheme due to increasing fuel prices. FedEx has slowly gained in competition with UPS in terms of revenue. In a year, FedEx averages about $22 billion in sales while UPS averages $30 billion a year. Sometimes you just have to face the fact that a company’s success is best measured by its results of operations. When it comes to the selling rates of their shares in the stock market, UPS is still number one with their stocks valued at $82 billion, while FedEx trails by a large margin selling only $22 billion dollars in stocks.…

    • 703 Words
    • 3 Pages
    Good Essays
    Read More
  • Better Essays

    BUS 599 Nadine Gilles Week 6 Assignment 2
    • 1386 Words
    • 4 Pages

    BUS 599 Nadine Gilles Week 6 Assignment 2

    This paper is to compare and analyze FedEx’s value creation frontier and execution strategies. I will also take a look at the four building blocks that FedEx needs for a competitive advantage to stay ahead and maintain above-average profitability. I will assess FedEx’s current business model and recommend a strategy on a business level to also give them an advantage over their competitors. I must also assess in what manner the overall global competition may impact FedEx’s new business strategy. I will also suggest one significant way that FedEx may confront the global…

    • 1386 Words
    • 4 Pages
    Better Essays
    Read More
  • Good Essays

    "United Parcel Service: Basic management structure."
    • 1525 Words
    • 5 Pages

    "United Parcel Service: Basic management structure."

    The United Parcel Service has taken steps to restructure itself from an operations-oriented company into a market driven industry. Recent findings suggested the need to achieve better external customer satisfaction. The steps taken were to improve the overall of all customers that utilize the services at UPS. Other key areas that need improvement are volume logistics and customer logistics. The main priority at UPS is to deliver the package on time. They provide a much-anticipated alternative to the monopoly of the United States Postal Service. This competitor has been unreliable on…

    • 1525 Words
    • 5 Pages
    Good Essays
    Read More
  • Good Essays

    Ups a Global Company
    • 928 Words
    • 4 Pages

    Ups a Global Company

    Companies which handle packaging services must be able to provide a variety of options to their consumers. They must be able to meet consumer demands when parcels need to be shipped and received within a designated timeframe. UPS is a global company which meets all of these needs.…

    • 928 Words
    • 4 Pages
    Good Essays
    Read More
  • Good Essays

    UPS IPO Case
    • 846 Words
    • 3 Pages

    UPS IPO Case

    UPS has grown from modest beginnings to an organization that ships for that 15 million packages a day with over 6.1 million customer in more than 200 counties as well as an estimated 54 billion dollars in revenue. UPS has had some ups and down, but for the most part have maintained strong. For example, UPS is a strong brand with a great market setting, cost and logistical advantage. They have built a strong supply chain management, distribution network and work force. One thing that really stuck out about the company, and as noted in the case is that many had joined the firm as part time workers while at college, and then stayed after graduation. It was not uncommon for employees to spend their entire working career at UPS. This really spoke volumes for the company and showed the faith that employees placed in the company. Some factors I believed needed improvement would be the customer satisfaction which was not on par with their competitors, and could have possibly looked at how management handled the finances of the company. Overall, I believe that UPS is a high performing organization that has built a brand and a successful organization from the bottom-up. When looking at financial ratio analysis for UPS, we must look at what set them apart from everyone else. If we look at the Profitability rations, we see the following reporting’s. From 1994-1998, we see Total Revenues increasing from $19,576 to 24,788, Total Operating Expenses increasing from $18,020 to $21,696 and Total Profit increasing from $1556 to $3090. These findings can easily justify why UPS is a best-of-breed company.…

    • 846 Words
    • 3 Pages
    Good Essays
    Read More
  • Better Essays

    Mgt 401 Business Model Comparison
    • 1057 Words
    • 5 Pages

    Mgt 401 Business Model Comparison

    When people think of transportation delivery services there are two names that come to mind and that is UPS and FedEx. These two brands are leaders and competitors in the transportation industry and have built a sustainable competitive advantage. When looking at these…

    • 1057 Words
    • 5 Pages
    Better Essays
    Read More
  • Powerful Essays

    UPS Vs FedEx
    • 1115 Words
    • 4 Pages

    UPS Vs FedEx

    This report will analyze the fierce on-going competition between the two companies that have dominated the package delivery service, FedEx Corporation and United Parcel Service, Incorporated. The situational analysis will explain the back and forth battle between in both popularity and profitability as these two companies try to gain market dominance. This part will also analyze the agreement between the United States and China regarding the new air-transportation agreement. Financial analysis will also be used to show that UPS, at the time the case was written, is financially superior to FedEx.…

    • 1115 Words
    • 4 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Fedex vs Ups
    • 4116 Words
    • 17 Pages

    Fedex vs Ups

    The air express segment was a $25bn portion of the US package-delivert industry, and was concentrated in letters and packages, overnight and deferred, and air or air and ground. Virtually all FedEx business activities were in the air express segment of the package delivery industry, only 22% of UPS’s revenues were derived from its next day air business. FedEx and UPS’s competition for the dominance of the $25bn domestic air express delivery market foreshadowed in an unusually challenging future…

    • 4116 Words
    • 17 Pages
    Powerful Essays
    Read More
  • Better Essays

    Fedex vs Ups competitive advantage
    • 974 Words
    • 4 Pages

    Fedex vs Ups competitive advantage

    Attaining a competitive advantage in package delivery business appears to be a challenging task. The main reason is that it is an easy-to- duplicate business both for the competitors and any new entrants. This is obvious in FedEx's case: the company always has distinguished itself through technologically advanced services, expanding in many places and new products over other competitors, especially UPS. UPS was the main choice for low-priced ground delivery services however being a market follower in the air delivery sector could negatively affect its reputation and cause loss of market in the long term.…

    • 974 Words
    • 4 Pages
    Better Essays
    Read More
  • Good Essays

    Financial Analysis-Ups
    • 6764 Words
    • 28 Pages

    Financial Analysis-Ups

    UPS implement unprecedented and comprehensive cost management initiatives in 2009, such as network changes and organizational and structural realignments, which lead to a better financial performance than its competitors in 2010 (UPS, 2010b). This paper will analyze UPS financial performance for the past three year and compare them with industry average and it closet rival-FedEx, from profitability ratios, liquidity ratios, leverage ratios, activity ratios, valuation ratios and growth rate.…

    • 6764 Words
    • 28 Pages
    Good Essays
    Read More
  • Satisfactory Essays

    Ups/Fedex Package Wars
    • 349 Words
    • 2 Pages

    Ups/Fedex Package Wars

    FedEx also has many strengths which keep the company extremely competitive in the industry. FedEx is a very entrepreneurial company, fostering creativity and innovative ideas. The fostering of innovation is important in order to differentiate from competitors and offering new and improved services to customers. FedEx is also a first mover in overnight delivery, grabbing a large portion of the market. FedEx also uses their innovative technologies to surpass competitors and differentiate themselves. Furthermore, the strategic alliance with Kinko’s gives FedEx a retail presence, attracting a different customer base with different needs. This partnering expanded the services FedEx offers.…

    • 349 Words
    • 2 Pages
    Satisfactory Essays
    Read More
  • Powerful Essays

    Ratio Analysis (Ups vs Fdx)
    • 7619 Words
    • 31 Pages

    Ratio Analysis (Ups vs Fdx)

    This analysis investigates the management policies of the two primary competitors of the Air Delivery & Freight Services industry. I use ratio analysis to peek under the covers of profitability to understand how management, investment and financial management activities impact the overall performance of FedEx and UPS and study how the ratios change over time for FedEx.…

    • 7619 Words
    • 31 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Ups Research Paper
    • 3990 Words
    • 16 Pages

    Ups Research Paper

    In 1907, a 19 year old entrepreneur James E. Casey and his partner developed a business for the Seattle, Washington area that provided quality messenger services. Within a century, the company managed to globalize the industry of delivery services along with a name many have come to know - UPS. Although their primary business is the time-definite delivery of packages and documents, they have also extended their capabilities in recent years to encompass the broader spectrum of services known as supply chain solutions, such as freight forwarding, customs brokerage, fulfillment, returns, financial transaction and even repairs. UPS is also the leading provider of less-than-truckload transportation services. The inner workings and strive for success shows how this fortune five hundred company strategically built this empire from the ground up, and in the process cloned the famous marketing slogan: “What can brown do for you?”…

    • 3990 Words
    • 16 Pages
    Powerful Essays
    Read More

Related Topics