United Parcel Service Inc.

– 2013
Forest David

A. Case Abstract

Headquartered in Atlanta, Georgia, the United Parcel Service competes as a multinational package
delivery, freight forwarding, and other business services company. The company serves over 220
countries and territories worldwide as well providing extensive shipments to virtually everywhere in
the USA. The company is the world’s largest publically held shipping company that delivers directly
to the consumer with revenues exceeding $50 billion in both 2011 and 2012. The company has
recently agreed to a new labor agreement with their employees that contributed to operating income
falling from $6 billion in 2011 to $1.3 billion in 2012.

B. Vision Statement (proposed)

To become the most recognized shipping brand worldwide.

C. Mission Statement (actual)

We seek to grow our global (3) business by serving the logistics needs (2) of customers (1) offering
excellence and value in all that we do. Maintain a financially strong company (5) with broad employee
ownership (9) that provides a long germ competitive return to our shareholders. Inspire our people and
business partners to do their best, offering opportunities for personal development and success. Lead
by example as a responsible, caring and sustainable company (8) making a difference in the
communities we serve.

(proposed)

We strive to be the most timely and dependable parcel and freight forwarding delivery service (2) in
the world (3). By implementing the latest tracking technology, (4) we are able to profitably grow (5)
our business by offering customers (1) more dependable and accurate delivery times. To maintain our
position as the largest parcel delivery company in the world, (7) we work closely with our employees
(9) promoting from within to improve morale among all employees. Our philosophy (6) is to balance
the need to take care of both our employees and shareholders, while serving the communities (8) in
which we operate in a sustainable and positive manner.

1. Customers
2. Products or services
3. Markets
4. Technology
5. Concern for survival, growth, and profitability
6. Philosophy
7. Self-concept
8. Concern for public image
 9. Concern for employees

D. External Audit
Opportunities

1. Trade across borders to grow much more than growth in the USA resulting in increased trade
among USA and foreign markets.
2. The nature of the industry makes it difficult for startup firms to compete in the market.
3. Joint ventures with firms in emerging markets are available for geographic expansion.
4. Increasing demand outsourcing the supply chain by pharmaceutical companies as drug patents
expire.
5. Firms such as Amazon and EBay promote direct business to consumer shipping.
6. Over 50% of all holiday shopping is expected to be delivered by mail in the next 3 years.
7. Allowed to borrow up to $10 billion in commercial paper from US sources and 1 billion Euros
from European Commercial Paper sources..
8. Obama Administration has the goal to double exports by 2015.
9. High tech shipments of smartphones and similar devices to grow 22+% in India, Middle East,
Africa in the next 3 to 5 years and 15+%in Eastern Europe and South America.
10. Increasing European Union membership streamlines customs and border control in these markets.

Threats

1. The United States Postal Service reports revenues around 20% higher than UPS and is backed by
the US government.
2. FedEx and DHL are top global competitors.
3. European Commission blocked the proposed acquisition of TNT Express, and other foreign
governments could implement similar measures.
4. 250,000 employees are affiliated with Teamsters and 1,600 pilots are members of the Independent
Pilot’s Association.
5. Slowing of world economies reduces demand for products and causes customers to ship more by
standard rather than express shipping.
6. The world is becoming more of a service economy rather than manufacturing based.
7. Jet fuel prices have doubled in the last 5 years.
8. Constant regulations with governments on pollution and maintenance requirements for aircraft and
vehicles.
9. E-mail eroding dramatically into the volume of letter mailing.
Competitive Profile Matrix

UPS FedEx USPS

Critical Success Factors Weight Rating Score Rating Score Rating Score
Advertising 0.08 4 0.32 3 0.24 2 0.16
Market Penetration 0.12 3 0.36 4 0.48 2 0.24
Customer Service 0.05 3 0.15 4 0.20 2 0.10
Store Locations 0.02 2 0.04 1 0.02 4 0.08
Services Offered 0.10 3 0.30 2 0.20 4 0.40
Employee Dedication 0.06 3 0.18 4 0.24 2 0.12
Financial Profit 0.12 2 0.24 4 0.48 1 0.12
Customer Loyalty 0.08 3 0.24 4 0.32 2 0.16
Market Share 0.10 3 0.30 2 0.20 4 0.40
Product Quality 0.06 3 0.18 4 0.24 2 0.12
Top Management 0.06 3 0.18 4 0.24 2 0.12
Price Competitiveness 0.15 3 0.45 2 0.30 4 0.60
Totals 1.00 2.94 3.16 2.62

UPS is well positioned within the CPM Matrix when compared to USPS and competitive with FedEx
The firm should work on improving the relationship with its unions moving forward and continue
internal expansion.

EFE Matrix

Opportunities Weight Rating Weighted Score

1. Trade across borders to grow much more than growth in the 0.10 3 0.30
USA resulting in increased trade among USA and foreign
markets.
2. The nature of the industry makes it difficult for startup firms to 0.01 3 0.03
compete in the market.
3. Joint ventures with firms in emerging markets are available for 0.08 4 0.32
geographic expansion.
4. Increasing demand outsourcing the supply chain by 0.05 4 0.20
pharmaceutical companies as drug patents expire.
5. Firms such as Amazon and EBay promote direct business to 0.06 4 0.24
consumer shipping.
6. Over 50% of all holiday shopping is expected to be delivered by 0.07 4 0.28
mail in the next 3 years.
7. Allowed to borrow up to $10 billion in commercial paper from US 0.05 2 0.10
sources and 1 billion Euros from European Commercial Paper
sources.
8. Obama Administration has the goal to double exports by 2015. 0.06 3 0.18
9. High tech shipments of smartphones and similar devices to grow 0.04 2 0.08
22% in India, Middle East, Africa in the next 3 to 5 years and
15% in Eastern Europe and South America.
10. Increasing European Union membership streamlines customs 0.02 2 0.04
and border control in these markets.
 Threats Weight Rating Weighted Score
1. The United States Postal Service reports revenues around 20%
0.05 3 0.15
higher than UPS and is backed by the US government.
2. FedEx and DHL are top global competitors. 0.10 2 0.20
3. European Commission blocked the proposed acquisition of TNT
Express and other foreign governments could implement similar 0.05 3 0.15
measures.
4. 250,000 employees are affiliated with Teamsters and 1,600 pilots
0.06 2 0.12
are members of the Independent Pilot’s Association.
5. Slowing of world economies reduces demand for products and
causes customers to ship more by standard rather than express 0.06 2 0.12
shipping.
6. The world is becoming more of a service economy rather than
0.07 2 0.14
manufacturing based.
7. Jet fuel prices have doubled in the last 5 years. 0.02 3 0.06
8. Constant regulations with governments on pollution and
0.02 3 0.06
maintenance requirements for aircraft and vehicles.
9. E-mail eroding dramatically into the volume of letter mailing. 0.00 0 0.00
TOTALS 0.97 2.77

UPS’s EFE score of 2.77 is above average. One of the largest threats facing UPS is that the world
is increasingly becoming technology based and less manufacturing based. UPS likely needs to
establish more agreements with technology firms to ship their products, and also form joint
ventures in developing markets.

E. Internal Audit
Strengths

1. UPS is the largest privately-held logistics company in the world providing service to 220 countries.
2. UPS has 40,000 drop boxes, 1,000 customer centers, 4,700 independently owned UPS stores, and
86,300 drivers.
3. New air hubs in Shanghai and Shenzhen.
4. UPS opened 12 new health care facilities on 4 different continents between 2011 and 2012.
5. 40% of full time managers have over 20 years experience with UPS.
6. Top 20 customers account for less than 10% of consolidated revenues.
7. Strong advertising campaign and brand equity.
8. Hubs or major presence in USA, Canada, Germany, Turkey, Hong Kong, China and others.
9. In addition to package delivery, UPS now offers supply chain solutions, freight forwarding, customer’s
brokerage, and even repairs.
10. 40% of 2012 revenues were derived form business to consumer shipments.

Weaknesses

1. Only 25% of 2012 revenues were derived from international markets, with half of these being derived
from Europe.
2. Total operating profit fell from $6 billion in 2011 to $1.3 billion in 2012 largely due to a 20% increase
in compensation and benefits during this period resulting from a new collective bargaining agreement
with the Teamsters.
3. Historically, UPS has not been in a position to raise fuel surcharge rates as fast as fuel prices have
increased.
4. UPS flies 5 different types of aircraft making maintenance and spare inventory parts more costly and
problematic.
5. Goodwill accounts for 45% of all equity.
6. Not serving the Chinese market to the extent necessary.
7. 268 cargo jets compared to FedEx’s 694.
8. Packaging segments in both domestic and international markets have experienced little growth over the
last 5 years.
9. Has a culture of promoting from within, possibly limiting new knowledge from entering the company.
10. Debt to equity ratio of 3.0

Financial Ratio Analysis

Profit Margin Percent UPS Industry

Gross Margin 76.72 58.57
Pre-Tax Margin 1.69 4.21
Net Profit Margin 1.52 2.78

Liquidity Ratios
Debt/Equity Ratio 3 0.64
Current Ratio 1.84 1.83
Quick Ratio 1.62 1.63

Profitability Ratios
Return On Equity 14.72 12.98
Return On Assets 2.24 4.48
Return On Capital 2.59 8

Efficiency Ratios
Income/Employee 2,077.69 6,160.23
Revenue/Employee 136,799.5 219,293.87
Receivable Turnover 9.94 8.72
Inventory Turnover NA 29.69
Asset Turnover 1.48 1.61

UPS is not doing as well as the industry at large and struggles with excess debt.

Net Worth Analysis (in millions)

UPS Company Worth Analysis

Stockholders' Equity - (Goodwill + Intangibles) $1,877
Net Income x 5 $4,035
(Share Price/EPS) x Net Income $85,317
Number of Shares Outstanding x Share Price $85,283
Method Average $44,128
 FedEx Company Worth Analysis
Stockholders' Equity - (Goodwill + Intangibles) $14,643
Net Income x 5 $7,805
(Share Price/EPS) x Net Income $35,528
Number of Shares Outstanding x Share Price $36,002
Method Average $23,494

UPS is worth considerably more than FedEx based on the last two methods. However, after a poor year in
2012, FedEx is worth considerably more than UPS on the first two methods.

IFE Matrix

Strengths Weight Rating Weighted Score

1. UPS is the largest privately-held logistics company in the world
0.08 4 0.32
providing service to 220 countries.
2. UPS has 40,000 drop boxes, 1,000 customer centers, 4,700
0.05 4 0.20
independently owned UPS stores, and 86,300 drivers.
3. New air hubs in Shanghai and Shenzhen. 0.05 4 0.20
4. UPS opened 12 new health care facilities on 4 different
0.05 4 0.20
continents between 2011 and 2012.
5. 40% of full time managers have over 20 years experience with
0.03 4 0.12
UPS.
6. Top 20 customers account for less than 10% of consolidated
0.05 4 0.20
revenues.
7. Strong advertising campaign and brand equity. 0.05 4 0.20
8. Hubs or major presence in USA, Canada, Germany, Turkey,
0.05 4 0.20
Hong Kong, China and others.
9. In addition to package delivery, UPS now offers supply chain
solutions, freight forwarding, customer’s brokerage, and even 0.04 4 0.16
repairs.
10. 40% of 2012 revenues were derived form business to consumer
0.04 4 0.16
shipments.

Weaknesses Weight Rating Weighted Score

1. Only 25% of 2012 revenues were derived from international
0.07 2 0.14
markets with half of these being derived from Europe.
2. Total operating profit fell from $6 billion in 2011 to $1.3 billion in
2012 largely due to a 20% increase in compensation and benefits
0.05 2 0.10
during this period resulting from a new collective bargaining
agreement with the Teamsters.
3. Historically, UPS has not been in a position to raise fuel
0.03 2 0.06
surcharge rates as fast as fuel prices have increased.
4. UPS flies 5 different types of aircraft making maintenance and
0.03 2 0.06
spare inventory parts more costly and problematic.
5. Goodwill accounts for 45% of all equity. 0.05 1 0.05
6. Not serving the Chinese market to the extent necessary. 0.06 1 0.06
7. 268 cargo jets compared to FedEx’s 694. 0.06 1 0.06
8. Packaging segments in both domestic and international markets
0.06 1 0.06
have experienced little growth over the last 5 years.
9. Has a culture of promoting from within, possibly limiting new
0.03 2 0.06
knowledge from entering the company.
10. Debt to equity ratio of 3.0 0.07 1 0.07
TOTALS 1.00 2.68
 UPS is doing above average on internal issues. However, the firm needs to work on improving their
financial situation and form more joint ventures with firms outside the USA.

F. SWOT
SO Strategies

1. Build a new hub in Germany to better serve the European market and compete directly with DHL (S1,
S8, S9, O1, O7, O8, O9).
2. Open 12 additional new health care facilities to aid the transport of medical supplies and products (S4,
O1, O4).
3. Spend an additional $50 million on advertising in Europe (S7, O1, O6, O7, O8, O9).
4. Invest $500 million in expanding supply chain solutions, freight forwarding, and customers' brokerage
world wide over the next 3 years (S9, O1, O4, O6).

WO Strategies

1. Build a new hub in Germany to better serve the European market and compete directly with DHL (W1,
W8, O1, O7, O8, O9).
2. Spend an additional $50 million on advertising in Europe (W1, W8, O1, O6, O7, O8, O9).
3. Purchase another 50 cargo jets of the same make and model (W1, W4, W6, W7, O1, O6, O8).
4. Identify 5 new major joint venture opportunities to help expansion in new markets (W1, W2, W6, O1,
O3).
5. Hire 3 new executives from outside the company to help facilitate the growing demand of
pharmaceutical companies have of managing their supply chain (W9, O4).

ST Strategies

1. Work with Amazon to ensure exclusive shipping of all products purchased (S1, S6, S7, S10, T1, T2).
2. Increase freight forwarding and supply chain management services by 50% over the next 3 years (S1,
S9, T5, T6, T9).
3. Increase advertising in markets dominated by FedEx and DHL by 50% over the next 3 years (S7, T2).

WT Strategies

1. Build a new hub in San Paulo, Brazil to better serve the South American market (W1, W8, T2, T3)
2. Increase fuel futures contracts by 100% (W3, T8).
G. SPACE Matrix

FP
Conservative Aggressive
7

4
X = 2.6
3 Y = 0.2

CP IP
-7 -6 -5 -4 -3 -2 -1 1 2 3 4 5 6 7
-1

-2

-3

-4

-5

-6

-7
Defensive Competitive
SP

Internal Analysis: External Analysis:

Financial Position (FP) Stability Position (SP)
Net Income 3 Rate of Inflation -2
Revenue 7 Technological Changes -2
Liquidity 2 Fuel Prices -5
Working Capital 6 Competitive Pressure -7
Goodwill 2 Barriers to Entry into Market -3
Financial Position (FP) Average 4.0 Stability Position (SP) Average -3.8

Internal Analysis: External Analysis:

Competitive Position (CP) Industry Position (IP)
Market Share -2 Growth Potential 5
Service Quality -2 Financial Stability 5
Customer Loyalty -2 Ease of Entry into Market 6
Diversification -2 Regulations 4
Aircraft Fleet Size -4 Profit Potential 5
Competitive Position (CP) Average -2.4 Industry Position (IP) Average 5.0

UPS is in the aggressive quadrant but is hampered by excessive Goodwill on the Balance Sheet and reduced Net
Income resulting in unfavorable outcomes with negotiations with employees and their respective labor unions.
H. Grand Strategy Matrix

Rapid Market Growth

Quadrant II Quadrant I

Weak Strong
Competitive Competitive
Position Position

Quadrant III Quadrant IV

Slow Market Growth

UPS has a Strong Competitive Position in the industry but should attempt to grow the freight forwarding
and non-shipping services businesses as the industry is growing slowly in traditional shipping and losing
growth in express shipping.
 I. The Internal-External (IE) Matrix

The Total IFE Weighted Scores

Strong Average Weak
4.0 to 3.0 2.99 to 2.0 1.99 to 1.0
4.0 I II III

High

3.0 IV V VI
International Package

Domestic Package

Medium
Weighted

2.0 VII VIII IX

Supply Chain & Freight

Low

1.0

2012
Segment Total Sales (in millions) Profit
US Domestic Package $32,856 $459
International Package 12,124 869
Supply Chain & Freight 9,147 15
Total 54,127 1,343
 The International Package segment reported the largest profits in 2012, despite having around 1/3 the
revenues of the International Package segment. This could be partly explained by the new collective
bargaining agreement with the Teamsters. Supply Chain & Freight, while reporting respectable revenues
only, reported profits of $15 million.

J. QSPM

Expand
Expand
Supply Chain
Package
& Freight
Segment
Segment
Opportunities Weight AS TAS AS TAS
1. Trade across borders to grow much more than growth in the
USA resulting in increased trade among USA and foreign 0.10 4 0.40 2 0.20
markets.
2. The nature of the industry makes it difficult for startup firms to
0.01 4 0.04 2 0.02
compete in the market.
3. Joint ventures with firms in emerging markets are available for
0.08 4 0.32 2 0.16
geographic expansion.
4. Increasing demand outsourcing the supply chain by
0.05 1 0.05 4 0.20
pharmaceutical companies as drug patents expire.
5. Firms such as Amazon and EBay promote direct business to
0.06 4 0.24 1 0.06
consumer shipping.
6. Over 50% of all holiday shopping is expected to be delivered by
0.07 4 0.28 1 0.07
mail in the next 3 years.
7. Allowed to borrow up to $10 billion in commercial paper from US
sources and 1 billion Euros from European Commercial Paper 0.05 0 0.00 0 0.00
sources.
8. Obama Administration has the goal to double exports by 2015. 0.06 3 0.18 1 0.06
9. High tech shipments of smartphones and similar devices to grow
22% in India, Middle East, Africa in the next 3 to 5 years and 0.04 3 0.12 1 0.04
15% in Eastern Europe and South America.

10. Increasing European Union membership streamlines customs

and border control in these markets. 0.02 3 0.06 1 0.02
 Threats Weight AS TAS AS TAS
1. The United States Postal Service reports revenues around 20%
0.05 0 0.00 0 0.00
higher than UPS and is backed by the US government.
2. FedEx and DHL are top global competitors. 0.10 2 0.20 4 0.40
3. European Commission blocked the proposed acquisition of TNT
Express and other foreign governments could implement similar 0.05 0 0.00 0 0.00
measures.
4. 250,000 employees are affiliated with Teamsters and 1,600 pilots
0.06 0 0.00 0 0.00
are members of the Independent Pilot’s Association.
5. Slowing of world economies reduces demand for products and
causes customers to ship more by standard rather than express 0.06 2 0.12 4 0.24
shipping.
6. The world is becoming more of a service economy rather than
0.07 1 0.07 4 0.28
manufacturing based.
7. Jet fuel prices have doubled in the last 5 years. 0.03 2 0.06 4 0.12
8. Constant regulations with governments on pollution and
0.02 1 0.02 4 0.08
maintenance requirements for aircraft and vehicles.
9. E-mail eroding dramatically into the volume of letter mailing. 0.02 0 0.00 0 0.00

Expand
Expand
Supply Chain
Package
& Freight
Segment
Segment
Strengths Weight AS TAS AS TAS
1. UPS is the largest privately-held logistics company in the world
0.08 4 0.32 3 0.24
providing service to 220 countries.
2. UPS has 40,000 drop boxes, 1,000 customer centers, 4,700
0.05 4 0.20 3 0.15
independently owned UPS stores, and 86,300 drivers.
3. New air hubs in Shanghai and Shenzhen. 0.05 4 0.20 3 0.15
4. UPS opened 12 new health care facilities on 4 different
0.05 2 0.10 4 0.20
continents between 2011 and 2012.
5. 40% of full time managers have over 20 years experience with
0.03 0 0.00 0 0.00
UPS.
6. Top 20 customers account for less than 10% of consolidated
0.05 0 0.00 0 0.00
revenues.
7. Strong advertising campaign and brand equity. 0.05 0 0.00 0 0.00
8. Hubs or major presence in USA, Canada, Germany, Turkey,
0.05 3 0.15 2 0.10
Hong Kong, China and others.
9. In addition to package delivery, UPS now offers supply chain
solutions, freight forwarding, customer’s brokerage, and even 0.04 1 0.04 4 0.16
repairs.
10. 40% of 2012 revenues were derived form business to consumer
0.04 3 0.12 1 0.04
shipments.
 Weaknesses Weight AS TAS AS TAS
1. Only 25% of 2012 revenues were derived from international
0.07 0 0.00 0 0.00
markets with half of these being derived from Europe.
2. Total operating profit fell from $6 billion in 2011 to $1.3 billion in
2012 largely due to a 20% increase in compensation and benefits
0.05 3 0.15 0 0.00
during this period resulting from a new collective bargaining
agreement with the Teamsters.
3. Historically, UPS has not been in a position to raise fuel
0.03 3 0.09 0 0.00
surcharge rates as fast as fuel prices have increased.
4. UPS flies 5 different types of aircraft making maintenance and
0.03 0 0.00 2 0.06
spare inventory parts more costly and problematic.
5. Goodwill accounts for 45% of all equity. 0.05 0 0.00 2 0.10
6. Not serving the Chinese market to the extent necessary. 0.06 0 0.00 2 0.12
7. 268 cargo jets compared to FedEx’s 694. 0.06 0 0.00 2 0.12
8. Packaging segments in both domestic and international markets
0.06 0 0.00 2 0.12
have experienced little growth over the last 5 years.
9. Has a culture of promoting from within, possibly limiting new
0.03 0 0.00 2 0.06
knowledge from entering the company.
10. Debt to equity ratio of 3.0 0.07 2 0.14 2 0.14
TOTALS 3.67 3.71

The QSPM reveals each broad strategy is relatively equal in desirability. UPS should continue both
domestic and international packaging expansion as well as penetrating new markets and developing
existing markets for its Freight Forwarding and Supply Chain management.

K. Recommendations
1. Build a new hub in Germany to better serve the European market and compete directly with DHL for
$250M.
2. Open 12 additional new healthcare facilities to aid the transport of medical supplies and products for
$200M.
3. Spend an additional $50 million on advertising in Europe.
4. Invest $500 million in expanding supply chain solutions, freight forwarding and customers brokerage
world wide over the next 3 years.
5. Hire 3 new executives from outside the company to help facilitate the growing demand of
pharmaceutical companies have of managing their supply chain for $500k.

L. EPS/EBIT Analysis (in millions expect for EPS and Share Price)
Amount Needed: $1,000M
Stock Price: $90.92
Shares Outstanding: 938
Interest Rate: 5%
Tax Rate: 17%
 Common Stock Financing Debt Financing
Recession Normal Boom Recession Normal Boom
EBIT $1,000 $5,000 $7,000 $1,000 $5,000 $7,000
Interest 0 0 0 50 50 50
EBT 1,000 5,000 7,000 950 4,950 6,950
Taxes 170 850 1,190 162 842 1,182
EAT 830 4,150 5,810 789 4,109 5,769
# Shares 949 949 949 938 938 938
EPS 0.87 4.37 6.12 0.84 4.38 6.15

20 Percent Stock 80 Percent Stock

Recession Normal Boom Recession Normal Boom
EBIT $1,000 $5,000 $7,000 $1,000 $5,000 $7,000
Interest 40 40 40 10 10 10
EBT 960 4,960 6,960 990 4,990 6,990
Taxes 163 843 1,183 168 848 1,188
EAT 797 4,117 5,777 822 4,142 5,802
# Shares 940 940 940 947 947 947
EPS 0.85 4.38 6.14 0.87 4.37 6.13

The estimated EBIT is difficult to predict for UPS, considering historically, it is around $5 to $6 billion but
was only $1.3 billion in 2012, based largely on the additional salary and benefits paid to employees. Debt
financing maximizes EPS during prosperous times; however, it is unclear just how much capital UPS can
acquire with its current highly leveraged debt situation.

M. Epilogue
UPS in June 2013 increased its freight rates by 5.9 percent on shipments in the U.S., Canada and Mexico
that were less-than-truckload (LTL) and truckload (TL) rates. UPS also raised its rates by 4.5 percent on
UPS Air and International Services products of the domestic package business. Ground Services rates,
Express rates, and Airfreight (including Next Day Air, 2nd Day Air and 3 Day Freight between U.S.
Canada and Puerto Rico) rates were increased by 4.9 percent.

In May 2013, UPS opened a new healthcare facility in Hangzhou, Zhejiang Province, China, significantly
expanding its Asia healthcare distribution network. The high-tech facility is designed to offer seamless,
global solutions to healthcare companies looking to expand into, transport within, and export from China.
The facility consists of 22,000 square meters of dedicated healthcare space, and is designed to meet the
specific storage and distribution needs of pharmaceutical companies. “With many healthcare companies
demanding rigorous supply chain solutions in China, we are seeing increasing opportunities,” said Richard
Loi, President of UPS China. “The UPS Hangzhou facility, along with our existing Shanghai medical
device facility, will speed products to key markets within China, and underscores UPS’s commitment to
strengthening our China network.” The new Hangzhou facility is part of UPS’s global healthcare
expansion strategy. The company opened its first Asia healthcare facility in Singapore in 2011, and
followed rapidly with opening three additional facilities in Q3 of 2012, located in Hangzhou and Shanghai,
China, and Sydney, Australia. UPS provides healthcare companies specialized freight and small package
transportation and distribution services through a global healthcare network of 41 dedicated healthcare
facilities encompassing 595,000 square meters. The network offers temperature-sensitive handling,
geographic-specific regulatory compliance, monitoring and security, kitting and labeling.

Also in May 2013, UPS was awarded the International Standardization Organization (ISO) 13485:2003 and
 ISO 9001:2008 certifications recognizing its quality management system across its global healthcare
logistics network. “Our ISO certification substantiates UPS’s commitment to quality on a global scale,”
said Craig Foster, senior vice president, supply chain and healthcare logistics, UPS Asia Pacific Region.
“Our dedicated healthcare facilities in the APAC region enable comprehensive and compliant services to
customers in the pharmaceutical, biotech and medical device industries.”

Chapter 10: UPS

10 Basic Questions

1: A

2: B

3 C
4: D

5: C

6: C

7: A

8: D

9: C

10: C

15 Applied Questions

Boston Consulting Group (BCG) and Internal-External (IE) Matrices

1: C

2: B

3: B

4: B

5: A

Grand Strategy Matrix and Quantitative Strategic Planning Matrix (QSPM)

1: A

2: C

3: D

4: A

5: C
Business Ethics

1: A

2: B

3: A

4: C

5: B