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Fedex Vs Ups Case Study

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Thomas Carper (D-DE), Chairman addresses the comparison between USPS pricing and their competitors FedEx and UPS. The USPS carries a similar amount of product as FedEx, yet continues to earn half the revenue as FedEx on an annual basis. James E. Millstein stated that the dominant package deliverer is UPS, the key is that the USPS maintains a network that reaches all delivery points whereas UPS and Fed Ex can pick their locations of point of delivery. Megan J. Brennan noted that the business that makes upv76 percent of their revenue is a capped price, legislation would be necessary to remove these price caps. Thomas Carper (D-DE) clarified that there is a misunderstanding between the long and shorty term liability when it comes to the health …show more content…

The Honorable David C. Williams stated “ there is not”. Megan J. Brennan stated that if proper legislation was passed the USPS would be liquid and would be able to manage the debts it will inherit. Senator Jon Tester (D-MT) asked the panel if anyone has looked at the contracts and addressed the “last mile” and “ Universal Service Agreements to see if they are appropriate? The Honorable Robert G. Taub stated that all competitive products have to cover their costs. James E. Millstein stated that other counties allow their postal services to engage in other lines of business in order to provide the resources to supply all delivery point, the regulations have greatly affected the USPS business model, creating a burden “ if you want it to be self-sustaining, you have to give it the ability to be self-sustaining to fulfil that Universal Service Agreement obligation”. Senator Cory Booker (D-NJ) expressed concern to modernize equipment and invest in …show more content…

He also asked if there are other countries who have privatized their postal service and if a Universal Service Obligation exists ? Jim Milstein stated that although many countries do this however these PS that become profitable are countries where regulations are lifted for the PS and allowing them to offer other services. Tom Coburn (R-OK), Ranking Member stated that he is not interested in USPS owning a bank or operating as one, he is also not interested in hearting about the USPS becoming an insurance company. Megan J. Brennan expressed the concern to innovate at the core, such as grocery delivering which has already taken place in several markets. Senator Heidi Heitkamp (D-ND) expressed concerns on what “ the last mile” means for rural America and how can we begin to put our faith in PS in rural America again and that service standards are not what they use to be. The Honorable David C. Williams noted that USPS moral is extremely low, after continued losses and cut backs, the time to pass legislation has long

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