UPS 2009 Annual Report Download - page 21

Leading-edge Technology. We are a global leader in developing technology that helps our customers
optimize their shipping and logistics business processes to lower costs, improve service and increase efficiency.
Technology powers virtually every service we offer and every operation we perform. Our technology
initiatives are driven by our customers’ needs. We offer a variety of on-line service options that enable our
customers to integrate UPS functionality into their own businesses not only to conveniently send, manage and
track their shipments, but also to provide their customers with better information services. We provide the
infrastructure for an Internet presence that extends to tens of thousands of customers who have integrated UPS
tools directly into their own web sites.
Broad Portfolio of Services. Our portfolio of services enables customers to choose the delivery option that
is most appropriate for their requirements. Increasingly, our customers benefit from business solutions that
integrate many UPS services in addition to package delivery. For example, our supply chain services—such as
freight forwarding, customs brokerage, order fulfillment, and returns management—help improve the efficiency
of the supply chain management process.
Customer Relationships. We focus on building and maintaining long-term customer relationships. We
serve 1.8 million pick-up customers and 6.1 million delivery customers daily. Cross-selling small package,
supply chain and freight services across our customer base is an important growth mechanism for UPS.
Brand Equity. We have built a leading and trusted brand that stands for quality service, reliability and
product innovation. The distinctive appearance of our vehicles and the friendliness and helpfulness of our drivers
are major contributors to our brand equity.
Distinctive Culture. We believe that the dedication of our employees results in large part from our
distinctive “employee-owner” concept. Our employee stock ownership tradition dates from 1927, when our
founders, who believed that employee stock ownership was a vital foundation for successful business, first
offered stock to employees. To facilitate employee stock ownership, we maintain several stock-based
compensation programs.
Our long-standing policy of “promotion from within” complements our tradition of employee ownership,
and this policy reduces the need for us to hire managers and executive officers from outside UPS. The majority
of our management team began their careers as full-time or part-time hourly UPS employees, and have spent
their entire careers with us. Many of our executive officers have more than 30 years of service with UPS and
have accumulated a meaningful ownership stake in our company. Therefore, our executive officers have a strong
incentive to effectively manage UPS, which benefits all our shareowners.
Financial Strength. Our balance sheet reflects financial strength that few companies can match. As of
December 31, 2009, we had a balance of cash and marketable securities of approximately $2.100 billion and
shareowners’ equity of $7.696 billion. Our Moody’s and Standard & Poor’s (“S&P”) short-term credit ratings are
P-1 and A-1+, respectively, and our Moody’s and S&P long-term credit ratings are Aa3 and AA-, respectively.
We have a stable outlook from Moody’s, however subsequent to year-end, S&P changed its outlook for the
company from stable to negative. We have a strong capacity to service our obligations. Our financial strength
gives us the resources to achieve global scale; to invest in employee development, technology, transportation
equipment and buildings; to pursue strategic opportunities that facilitate our growth; and to return value to our
shareowners in the form of dividends and share repurchases.
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