United Parcel Service and Seasonal Christmas Struggles
Christmas is always a time of overload for many American businesses, especially shipping and sourcing companies. Planning for this particular period of market activity is a very complex procedure due to the involvement of a multitude of different factors, especially logistics (Berman, 2017). Unexpected multiple and prolonged delays and paralyzes in various supply chain segments are frequent problems during the season (Bogage & Denham, 2020). Large, medium-sized, and small organizations employ different strategies and tactics to achieve a productive balance of financial, human, and time resources and remain profitable.
UPS adds a surcharge to offset additional costs due to extreme market and infrastructure conditions and generate profits (Franck, 2017). Its major competitor, FedEx, is taking a different approach. They charge extra for shipments that need special packaging and handling. The COVID-19 crisis has significantly boosted the development of e-commerce (Berthene, 2022). It has resulted in even greater overload and profits for business entities such as UPS and FedEx (Evans, 2022). The market has stabilized since the pandemic’s peak and it continues to grow today. These large companies need a strategy to adapt to the already changed and demanding environment.
Analyzing the Mission and Vision of UPS
Like any other market actor, UPS has its unique mission and vision. According to them, its mission is “to provide solutions and world-class customer service by ensuring our retailers are supported in the over 5,000 communities we serve” (Our mission & vision, n.d., para. 1). The wording of it is effective, practical, and explanatory. It shows what product the company offers using simple words. It is the primary function of the mission of any commercial entity (Peek, 2023). It indicates the size of the UPS in exchange for conciseness. Their vision is to “passionately support the small businesses in our neighborhoods because their community is our community” (Our mission & vision, n.d., para. 2). It directly shows UPS’s meaning and purpose while also displaying such principles critical to any supply chain management organization as benevolence and cohesion and, therefore, it serves its function.
SWOT Analysis for UPS
UPS is one of the leaders in the shipping market sector with significant monetary and human resources. The organization is confidently mastering the field of e-commerce using these forces. It also collaborates with Amazon, another big industry player, and together they have the potential to become long-term dominant business actors in the United States and the world. However, their negative qualities, such as inflexibility in finances and insufficient planning for the Christmas season, could lead to their loss of market position with FedEx.
Five Steps for UPS
- UPS is a large company in the shipping sector that has the potential to become a top market player.
- They need flexibility in their financial planning to profit more during November and December.
- The solution is to change the approach to tactical financial management.
- UPS needs to hire experienced managerial experts with a new vision for them.
- Innovation and new people in management positions are what UPS lacks.
A More Specific Recommendation
Among the goals that UPS should pursue, one of the key ones should be the development of a universal compensatory approach to large and unique shipments similar to their addition of surcharge, which would also bring significant strategic profits.
References
Berman, J. (2017). Prospects for peak season appear to be cautiously optimistic. Logistics Management. Web.
Berthene, A. (2022). The coronavirus pandemic adds $219 billion to US e-commerce sales in 2020-2021. Digital Commerce 360. Web.
Bogage, J. & Denham, H. (2020). Millions of Christmas presents may arrive late because of postal service delays. Washington Post. Web.
Evans, K. (2020). Holidays and health concerns continue to drive online sales in December. Digital Commerce 360. Web.
Franck, T. (2017). UPS set to make a boatload on its new surcharges during the holiday season, Citi predicts. CNBC. Web.
Our mission & vision. (n.d.). The UPS Store. Web.
Peek, S. (2023). What Is a Vision Statement? Business News Daily. Web.