The future of United Parcel Service

UPS Future

The Future of UPS

UPS was founded in 1907 as the by American Messenger Company. It was found by 19-year-old Jim Casey as a private messenger service that employed local teenagers in Seattle. Shortly after, starting in 1913, the company began a move from messages to packages, used automobiles to deliver the packages, and focused on retailers. UPS offered parcel delivery services between the 48 contiguous United States by 1975. In the 1980s, UPS began flying packages on its own airplanes to avoid the risk associated with relying on commercial airlines. UPS is now the 9th largest airline in the world (Wikinvest, 2013).

10-Year Stock History (Wikinvest, 2013)

UPS has performed significantly better than its public sector counterpart, the USPS. The Postal Service, which lost $15.9 billion last year and exhausted its $15 billion borrowing limit, should consider expanding partnerships with the private sector, a report released Thursday by a National Academy of Public Administration panel said. The post office already partners with companies including FedEx Corp. And United Parcel Service Inc. (Keane, 2013). UPS is already a customer and a vendor to USPS. UPS uses the USPS to deliver packages in remote areas and the USPS uses UPS's planes to move many of its packages.

If the USPS does use contractors then it is likely that UPS will pick up a substantial domestic load. However, the biggest growth opportunity for UPS is in foreign markets. The company already operates in 175 different countries and territories and the company is further expanding logistics capabilities to become more integrated as a supply chain partner. Therefore, UPS basically has two options to continue its remarkable growth. It can continue developing foreign markets or it can expand horizontally and offer clients more comprehensive services (UPS, N.d.). The company has been following both growth strategies simultaneously.