Pro-Forma Financial Statements The various Pro-forma financial statements are highlighted in the appendix below. Net Present Value The Net Present Value (NPV) for the difference between the proposed new strategy versus the current strategy of UPS is calculated as $5,814,526,352. This calculation is based on the estimated cash flows between 2015 through 2017, utilizing the difference between initial liabilities and new strategy liabilities as the initial investment. These values were calculated in the aforementioned section. In this case, the federal funds rate was utilized as the rate of return (the interest rate in the calculation). The new strategy produced cost savings in terms of liabilities and additionally lower cash flows. Although marketing …show more content…
India is a technical workforce and believes they are on a sustained path of high growth which creates the perfect opportunity for UPS to penetrate the market (Arthaud-Day, Banerjee, & Rothaermel, 2016). The specific strategy recommended for UPS to utilize would be to purchase two smaller logistics companies operating in two different locations. The reason for two different locations is because India is a large country with numerous rural areas that have not yet been developed. This means for growth potential it is important for UPS to consider two separate locations so they are able to penetrate the market through the acquisition of two smaller firms. From the acquisition UPS will be able to improve and expand the coverage and the breadth of services offered to those rural …show more content…
UPS has the infrastructure, employee engagement, and financial capacity to make this proposed model a success. The approach UPS should strive to achieve would be two-dimensional: one being in terms of stronger international presence (China and India specifically) in order to remain a key player in the package delivery market globally, and the other being to market and refine customer service efforts (timeliness, quality assurance, etc.). In terms of international presence, foreign markets may have a presence of their own companies for such services in the delivery market. Accordingly, UPS must remain diplomatic and utilize such relationships to partner and/or acquire smaller, yet reliable, delivery service carriers abroad. In doing so, UPS can ensure immediate customer retention as well as loyalty build up. The short and long term actions below will allow UPS to ensure sufficient growth and power within the industry. Additional strategies to be considered are part of the previously referenced Bivariate Strategy Matrix Short Term