UPS 2005 Annual Report Download - page 19

competitors. Our strategy is to increase domestic revenue through cross-selling our existing and new services to
our large and diverse customer base, to limit the rate of expense growth and to employ technology-driven
efficiencies to increase operating profit.
Continued International Expansion. We have built a strong international presence through significant
investments over several decades. The international package delivery market continues to grow at a faster rate
than that of the U.S. We will use our worldwide infrastructure and broad product portfolio to grow high-margin
premium services and to implement cost, process and technology improvements in our international operations.
Europe is our largest region outside the United States – accounting for half of our international revenue.
Both Europe and Asia offer significant opportunities for growth. The expansion of the European Union to include
several Eastern European and Baltic countries will create even greater economic cohesion. Growth in Asia will
be driven by global demand, leading to improved demographic and economic trends throughout the region, with
specific emphasis on China and India.
Provide Comprehensive Supply Chain Solutions. In today’s global economy, entire industries have
outsourced all or part of their supply chains to streamline and gain efficiencies, to strengthen their balance sheets,
to support new business models and to improve service. Companies’ global supply chains are growing
increasingly complex. This is creating further demand for a global service offering that incorporates
transportation, distribution and international trade services with financial and information services. We believe
that we are well positioned to capitalize on this growth for the following reasons:
• We manage supply chains for large and small companies in 186 countries and territories, with about
35 million square feet of distribution space and over 1,000 facilities worldwide.
• We focus on supply chain redesign, freight forwarding, international trade services and management-
based solutions for our customers rather than solely on more traditional asset-based logistics such as
warehouses and vehicle fleets. We have built valuable intellectual capital in specific high growth
industries such as healthcare and technology.
• We provide a broad range of transportation solutions to customers worldwide, including air, ocean and
ground freight, as well as customs brokerage and trade and materials management. We provide
standardized service, IT systems and specialized distribution facilities and services adapted to the
unique supply chains of specific industries such as healthcare, technology, and consumer/retail.
• We offer a portfolio of financial services that provides customers with short- and long-term financing,
secured lending, working capital, government guaranteed lending, letters of credit, global trade
financing, credit cards and equipment leasing.
Leverage Our Leading-Edge Technology and E-Commerce Advantage. Our goal is to provide our
customers with easy-to-use, flexible technology offerings that streamline their shipment processing and integrate
critical transportation information into their business processes, helping them create supply chain efficiencies,
improve their cash flows and better serve their customers. Our leading-edge technology has enabled our
e-commerce partners to integrate our shipping functionality and information solutions into their e-commerce
product suites.
Pursue Strategic Acquisitions and Global Alliances. Strategic acquisitions and global alliances play a
significant role in spurring growth. We look for opportunities that:
• complement our global package business;
• build our global brand;
• enhance our technological capabilities or service offerings;
• lower our costs; or
• expand our geographic presence.
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