The Tragedy Of Hamlet :: Hamlet William Shakespeare

In Hamlet, by William Shakespeare, the death of a character becomes a frequent event. Although many people lose their lives as a result of their own self-centered wrong-doing, there are others whose deaths are a result of manipulation from the royalty. This is the case of Polonius' family. The real tragedy of Hamlet is not that of Hamlet or his family but of Polonius' family because their deaths were not the consequence of sinful actions of their own but rather by their innocent involvement in the schemes of Claudius and Hamlet. The first character to die in Hamlet is Polonius. Although Polonius often acts in a deceitful manner when dealing with Hamlet, it is only because he is carrying out plans devised by the king or queen to discover the nature of Hamlet's madness. Being the king's Lord Chamberlain, it is his duty to obey the king and queen's wishes and it is this loyalty that eventually proves to be fatal for him. An example of how Polonius' innocent involvement with the royalty results in his death can be found at the beginning of Act III, scene iv, when Hamlet stabs him while he is hiding behind the arras in Gertrude's room. This shows how Polonius, a man unaware of the true nature of the situation he is in, is killed by a member of the royalty during the execution of one of their schemes. This makes Polonius' death a tragedy. The next member of Polonius' family to die is his daughter Ophelia. Ophelia's death is tragic because of her complete innocence in the situation. Some may argue that Polonius deserves his fate because of his deceitfulness in dealing with Hamlet while he is mad, but Ophelia is entirely manipulated and used by Hamlet and the king for their own selfish reasons. An example of how Ophelia is used by Hamlet takes place in Act II, scene i, when Hamlet uses her to convince his family he is mad. Ophelia explains to Polonius how Hamlet has scared her, causing Polonius to draw the conclusion that Hamlet has an "antic disposition". Although this is subject to interpretation and many believe that this is simply Hamlet taking one last look at Ophelia before he becomes engaged in his plan to kill Claudius, the fact that he scares her and does not try to alleviate these fears points to the conclusion that he is simply using her to help word of his madness spread throughout the kingdom via Polonius.

KFC †Marketing Strategy Essay

The purpose of this paper is to critically evaluate the marketing strategies of KFC (Kentucky Fried Chicken). The researcher will analyze how the organization creates superior value and builds strong relationship to capture value from customers in return. The paper explores facts for building and maintaining profitable customer relationship by delivering superior value and satisfaction. The researcher is going to investigate the social obligations of the company to observe the impact organizational  policies on the environment, community, health of the consumer and use of available resource At the end the researcher will suggest how the company can design customer driven marketing strategy for acquiring, retaining and attracting new customers. The paper also focuses on creating superior value and satisfaction through blissful marketing and communication programmes. INTRODUCTION KFC which stands for Kentucky Fried Chicken formed in 1930 and based in Louisville is the world’s famous chicken restaurants chain specializing in original recipe, extra crispy, Kentucky grilled chicken etc. Everyday more than 12 million customers are served in more than 109 countries and regions. KFC operates more than 800 restaurants in UK, more than 5200 restaurants in USA and more than 15,000 restaurants around the globe. KFC is part of YUM brands corporation, the world’s largest restaurant company in terms of system restaurants with more than 36,000 locations around the world. The company is ranked 239# on fortune 500 list, with revenue in excess of $11 billion in 2008. KFC is as committed to the environment as we are to our food and to our customers. We are proud of the steps we have taken so far to reduce our environmental footprint and are committed as a brand to do even more in the in future. It’s an ongoing journey that we’re on and we want to keep you – our customers – informed along the way! KFC introduced first reusable fast food container in 2010. The company replaced plastic plates with paper serving boxes and reduced use of non-renewable resources like styrofoam from the restaurants. By 2011 the company will reduce foam and plastic use by 62% and 11% respectively. Note: You can check the entire history of the corporation at http://www.kfc.com/about/pdf/timeline.pdf MARKETING It is the process by which the company creates value for the customers, builds strong relationship with the consumers and captures value in return. (Kotler, 2007) Let’s use the simple model of marketing process to assess the secrets behind the success of KFC. UNDERSTANDING THE MARKET The basic reason behind the success of KFC is their ability to understand the marketplace and needs of the customers. KFC conducts consumer research to go great length in learning about their market, competitors and customers. Consumer’s wants are satisfied by providing superior value and satisfaction. Other factors behind such a resounding success are the capability of company to understand whom to serve, how to serve by integrating customer driven marketing strategy and how to capture the value in return to build long term profitability. The company has adopted the concept of increasing the share of the customers rather than increasing product market share. CHOOSING A VALUE PROPOSITION After successful segmentation the company decides about how it will serve the customers to differentiate and position itself in the market place. Through value proposition the company creates set of benefits that distinguish itself as a premium brand in the market. the company provides superior food and dining experience to kids, families and visitors in order to discover dinning and to differentiate itself from competitors. The company offers products that offer most in quality, performance and taste. Due to service oriented nature of the hospitality industry; the company maintains customer-centred sense of marketing by developing the right products for their customers instead of finding the right customer for their products. MARKETING STRATEGY The primary goal of developing a customer driven marketing strategy is to build strong and profitable relationship with the customers for accomplishing short and long-term organizational goals. Through market segmentation, targeting and positioning the company divides its overall market into smaller segments to be served effectively. It identifies the needs of the target market by selecting the most promising segments and then delivers premium value in order to foster customer satisfaction and loyalty. In order to design a best marketing strategy and marketing mix; the company makes use of environmental analysis, marketing analysis, planning, implementation and control measures. To survive and be competitive in the market; KFC designs customer oriented strategies to win customers from their competitors and to grow by delivering superior value. The managements is aware about the cost of having dissatisfied customers who disparage the products to other individuals. Therefore they design products and services that are appealing to all the consumers. MARKET SEGMENTATION At first place the company decides whom it will serve? By dividing the target market into different segments like Family, Kids, Visitors, Tourists, Professionals, age, region, culture etc and then developing superior value for specific segments. Market segmentation enables the company to select and serve only those segments offering the best opportunity for achieving the organizational goals and objectives. Consumers are grouped and served based on demographic and geopgraphic factors. The segmentation also enable the company to analyze the behavioural patterns, affordability, best communication and delivery channel. TARGET MARKETING After the careful selection of the segments, the company evaluates the attractiveness and profitability of available segments. Based on such findings the company selects segments pledging for superior customer value, generating more profitability and where it can sustain value over time. MARKET POSITIONING In order to make a clear, distinctive and desirable product image before the target market; KFC makes use of competitive intelligence to get useful information about their competitors for gaining competitive advantage in the market, benefiting from first mover advantage (FMA) and for having a competitive prices. The company sustains the competitive advantage by having lower prices than competitors and providing more benefits. The company differentiates itself through by rewarding customer loyalty and appreciating staff’s or customer’s input for customizing their menu. Another useful tactic used by the company is the selection of medium through which the information is distributed (disseminated) to the general public for  maintaining the desirable brand recognition and picture. The company effectively uses all the available media (print, electronic etc) for targeting the potential customers and creating a distinct corporate image. MARKETING MIX It is the set of controllable tactical marketing tools that the company blends in order to get the desired response from the target market (Kotler, 2005). It includes everything that the company aspires to influence demand in the target market. PRODUCT KFC offers tasty and convenient food to customer at nominal prices. The company produces products for family, kids and people of age groups to discover dinning. Although company has done alot for offering quality food to the target market but critics point that hamburgers, friend chicken, fries, and snacks contain high fat and salt. Sometimes meals are â€Å"Super sized† leading to over eating and becoming an evident cause of obesity epidemic. Although the products are wrapped in convenient packaging but raise demands for handling substantial waste and pollution. KFC being the largest fast food supplier generates tons of solid waste every day where significant percentage isn’t recyclable and lasts longer on the landfills. Therefore in the shorter run the company is satisfying consumer needs but creating environmental problems in the longer run. The company has a reputable image and brand name in the world for producing quality food with essential nutritions, healthy ingredients, low calories and drinks containing needed minerals. Customers can easily get the information about the products from the company’s website with guidance on how the product is made, customer can also customize product on their own premises and change the ingredients to their likings. All the burgers are filled with chicken breast only. Recently the company invest The company invests  £1 million per annum to switch to nutritionally superior high oleic rapeseed oil; following that recently company announced to use only high oleic rape seed oil in all products and aborting the use of palm oil. The company has variety of things distinguishing itself from the competitors  operating within the same industry. Some of the defining aspects distinguishing company from its competitors are easy to cook food, elegant packaging and status value. Buyers don’t estimate the product’s values and costs objectively and are only persuaded by perceived image of the company and its food in the market. PRICE The company deploys yield management to come up with competitive prices for their products. The prices are really low due to large number of players penetrating in the same market or industry and satisfying consumer needs. More than anything it’s the â€Å"brand identity† influencing people to acquire the product. The company also uses â€Å"Augmented Product† concept in order to boost the sales, provide special discounts and schemes for rewarding loyalty. The company has s different prices for different segments based on number of servings. PLACEMENTS The company greatly emphasizes on customer convenience for obtaining products/services therefore have designed free standing outlets so that customer’s are not few minutes walk away from the outlet, suburbs, cities or high street. The outlets are positioned at all major shopping malls, train stations, cities, city centres and suburbs so the cost of reaching the market, acquiring and disposing the product is low. Apart from expressing deep concerns for customer health issues; the company directly interacts with the target market by providing toll free number and facility to go online for reserving orders. The company has also adopted the concept of â€Å"Direct Marketing† where consumers can buy virtually anything without going to the outlet by telephone, mail-order catalogue or by visiting online. KFC uses www.kfc.co.uk or www.kfc.com for direct marketing. PROMOTION KFC deploys different activities for communicating the merits of their products and persuading customers to obtain their products/services. The company uses print and electronic media to target the potential customers  and for maintaining a distinctive image of their products/service before the public. KFC has the presence on different social websites such as Facebook, Flickr and Linkedin to promote the products. The company spends considerable amount of money for Advertising and Selling. The marketing experts design different TV Ads for promoting the products, targeting the individuals, disseminating the merits of products and attracting new ones. The company also uses bill boards, sign boards, print publications, brochures, magazines, printing success stories in the newspaper and forming partnership with other famous organizations to boost selling and preserve an elative face before the public. Recently the company was ranked as a Britian Top Employer and recognized as a great place for work on the basis of following catalyst characteristics performance recognition culture, friendliness, team work, career progression, advancement and development opportunities. MANAGING THE MARKETING EFFORT Apart from being good at marketing, KFC pays significant attention to management that includes in depth market analysis, planning, implementation and control. The company gathers lot of information about the market to analyze whether the window of opportunity is opened for their products before actually marketing products to the target market. The company first develops marketing oriented mission statement, then develop strategic plan for products, services, brands and target markets. After thorough consideration and planning the company turns plan into actions. ENVIRONMENTAL ANALYSIS The environmental or PEST analysis is used to assess the industry in which the company is operating and is used in conjunction in SWOT Analysis to find out major opportunities or threats facing company. The company can use such techniques to examine the internal or external forces affecting their ability to provide superior value to customers at a fair price. The pest analysis of the KFC is as under POLITICAL KFC has partnered with several government and non-government organizations to effectively circumvent barriers influencing to deliver premium value to  customer. Many consumers and environmental groups have raised their voice against fast food giants providing junk and unhealthy food to consumers. Critics suggest that hamburgers, French fries, fried chicken etc are high in fat and salt. The government has also restricted the fast food giants not to market the food to under age groups and regulated the companies to modify their product menu that doesn’t contribute to national obesity epidemic. Critics feel that fast food companies are harming consumer health and providing fat food. Recently KFC signed up to the Government’s Public Health Responsibility Deal, promising to include calories on menu boards. The company will also be launching a ‘Lighten Up’ initiative at point of sale by offering customers an opportunity to lighten up their meals for free or by swapping a regular drink to diet, and fries for corn or beans – saving up to 295 calories. The company was also the first QSR to introduce salad to the menu and to stop salting its fries, and eliminated artificial trans fats in 2007 by removing hydrogenated vegetable oils from its menu. Furthermore, a salt reduction programme launched in 2005 has so far cut salt by up to 40% across the menu. The company has adopted fair trade practices e.g having the culture of equal opportunity employment, minority rights, accurately declaring business income, paying taxes. In united states Food and Drug administration, Consumer product safety commission set safety standards for the products and penalize companies failing to meet them. ECONOMIC The management keeps an eye on ongoing economic events so that the company isn’t affected by economic volatilities or uncertainties. The company closely monitors per capita income of consumers in different regions, ongoing inflation affecting buying behaviour and exchange rates limiting their ability to obtain or import material from suppliers. The company gathers all that information to exploit from labour market imperfections in the international arena and from expanded opportunity rationale. SOCIAL The company deploys Societal Marketing in order to maintain the equilibrium between consumer short-run wants and long-term welfare; the company has established strict guidelines for portraying a favourable public image and  to sustain brand recognition. KFC is a company that satisfies the needs of the target market by doing what’s best for them in the longer run? To curb the concerns of consumers and environmental groups the company has taken different initiatives to look after health and safety issues of their employees and customers in particular. Recently the company introduced â€Å"Brazer (non-fried, griddled range†, to consistently improve the nutritional profile of their menu (products), to fulfil promises made about health and to cut down the level of saturated fat. The company has also done partnership and signed memorandums with other organizations to look after public health issues. Recently the company was ranked as a Britain top employer and as a pleasant place to work for individuals. The company executive disclosed that the company provides advancement opportunities to individuals on merit and encourages team work and individual participation. The company established environmental leadership council in 2006, became a member of Considerate Contractor Scheme and presently working with Carbon Trust to reduce energy emissions. The company has also taken initiatives for reducing carbon footprints, making efficient use of natural resource e.g water, electricity etc. The company has also formed alliance with environmental defence system to handle solid waste and maintain environmentally favourable image. TECHNOLOGICAL The company is operating in a rapidly changing environment creating new opportunities and posing threats. The new technology creates new opportunities but the of replacing new technology is always high. The company is aware about the cost of ignoring new technology and its side effects as well. KFC is a company that keeps with the technological changes and refines its product menu on regular basis. Such changes have resulted in much higher research and development costs; due to the complex nature of the technology the marketers and consumers must have technical know how. SWOT ANALYSIS SWOT ANALYSIS is the acronym of Strengths, Weakness, Opportunity and threat; is a strategic tools used by the company to analyze the circumstances in which the company is operating. Strengths and Weaknesses are the internal  factors on which the organization has total control where as Opportunities and threats are the external uncontrollable factors. Strengths of KFC * Favourable public image and Brand Equity * Second largest fast food supplier after Macdonalds * Global Existence * Nominal Prices * Customer Convenience * Professional certifications and awards * Proactive management * Britain’s top employer and great place to work * Flexible Franchising bringing considerable revenue * Customer Equity * Organizational culture Weaknesses of KFC * High labour turnover * Junk food * Same taste twice * Lack of innovation * Cultural clash of two titans namely Pepsi and KFC * Hygienic food problems as one of the outlet in America was declared rat infected Opportunities for KFC * Rapidly changing economy and global trends * Increased demand for convenient food * Pursue Conglomerate Diversification for health conscious people * Increased diversity * Global market imperfections * Expanded opportunity rationale Threats for KFC * Saturated Market * Increased Competition * Rapidly changing technology * Legal legislations and political regulations * International political chaos * Low variety * Availability of substitute products * Threat of new entrants * Bargaining Power of Customers * Lack of competitive intelligence * Health and safety concerns * Environmental and Government Regulations ANSOFF’S PRODUCT MARKET EXPANSION GRID It is a portfolio mangement tool for identfying growth opportunities through market penetration, market development, product development and diversification. The model is depicted as Since its inception the company has used different tactics in order to hover around in the international market to market their products to domestic, national and international consumers. DIVERSIFICATION In 1930 the Harland Sanders opened his first restaurant in Corbin in front of gas station. PRODUCT DEVELOPMENT In 1937 Sanders Court & Cafà © added a motel and expanded the restaurant to 142 seats. MARKET PENETRATION, PRODUCT AND MARKET DEVELOPMENT In 1960 Colonel’s hard work on the road begins to pay off and there were 190 KFC franchisees and 400 franchise units in the U.S. and Canada. In 1964 Kentucky Fried Chicken had more than 600 franchised outlets in the United States, Canada and the first overseas outlet, in England. In 1971 the company had more than 3,500 franchises and restaurants worldwide when Heublein Inc. acquired KFC Corporation. At the end of 1979 the company had There are approximately 6,000 restaurants worldwide with sales of more than  $2 billion. PRODUCD DEVELOPMENT AND DIVERSIFICATION In 2007 KFC introduced a new recipe that keeps the Colonel’s 11 herbs and spices and finger-lickin’ flavor, but contains Zero Grams of Trans Fat per serving thanks to new cooking oil. In 2008 The Colonel had a new look! KFC updated one of the most recognized, respected and beloved brand icons with a new logo. The new logo depicted Colonel Sanders with his signature string tie but replaced his classic white double-breasted suit with a red apron symbolizing the home-style culinary heritage of the brand and reminded customers that KFC is always in the kitchen cooking delicious, high-quality, freshly prepared chicken by hand, just the way Colonel Sanders did 50 years ago. MARKET DEVELOPMENT AND DIVERSIFICATION In 2009 KFC introduced Kentucky Grilled Chickenâ„ ¢ – a better option for health conscious consumers to care for their long run welfare in order to capture the entire stream of purchases they would make for the rest of their life. Kentucky Grilled Chicken had less calories, fat and sodium than KFC’s Original Recipe ® chicken, without sacrificing the great taste of KFC. PRODUCT DEVELOPMENT In 2011 the company launched first ever non-fried range the Brazer! that is is a lighter, great-tasting alternative to KFC’s existing menu, and includes three new items; a burger, a Twister (a tortilla wrap) and a salad, each of which are lower in calories (by up to 60%), fat (by up to 87%), saturated fat (by up to 82%) and salt (by up to 45%) than regular menu items. The company has been using the Ansoff’s product market expansion grid by introducing the existing products internationally, providing halaal food to different communities opening new market and needs to be satisfied, by modifying the nutritional profile of their menu and by slightly changing the cooking ingredients at times. CUSTOMER RELATIONSHIP MANAGEMENT (CRM) AT KFC According to Philip Kotler (2007); customer relationship management is an art of building and maintaining profitable customer relationships by delivering superior value and satisfaction. KFC has developed an extensive database  about their customers in order to track touchpoints where they can deliver superior value and maintain profitable relationship with the customers. The major reason for the success of KFC is their ability to offer products having â€Å"highest customer perceived value† and exceeding the â€Å"customer perceived value†. Another reason of such a phenomenol success is the capability to market products whose perceived performance normally exceeds customers expectations. Beyond offering high quality products; the company has designed several customer loyalty and retention programs by rewarding customers on frequent purchases. The company also uses â€Å"Selective Relationship Managment† by undertaking customer profitability analysis where overall motive is to weed out loosing customers and target winning ones for pampering. The company creates profitable customers by providing exceptional quality products and delivering customer oriented superior value. The company knows that losing a single customer means losing the entire stream of purchases the customer would make over the entire lifetime. The firms leverages CRM to offer great variety to customers in order to increase the â€Å"Share of customers† rather than the â€Å"market share†. KFC examines its relationship with social values, responsibilities and the Earth that sustains it. Recently the company announced to cut the use of plastic by 17% and foam by 62% for the year 2011. The social responsibility and environmental movements have placed even strict demands on the company. As KFC is a forward looking company so it readily accepts the responsibility to the world and people around it. The company views such actions as an opportunity to do well by delivering good (new slogan of the company is â€Å"So Good†). The company compares the â€Å"opportunity cost† of its actions against the long-run interests of the customers and communities. The company has also taken initiatives towards Data Protection and Privacy Issues to curb the misuse, scam or phishing. PUBLIC RELATIONS AT KFC Public relation is an art of managing communication between the organization and the public with an objective to create and maintain favorable public image. KFC uses different communication tools for building awareness about their products and for preserving socially image in the marketplace for their products and services. The company deploys numerous equity or  perceived value and dent the reputation of the organization in the market. All the efforts are aimed at helping the public to understand the company and its products in more depth. The company sends â€Å"mystery shoppers† to different outlets to unveil defects in service or product. The company also gathers a lot of information about the customers and different topics of their interests to leverage relationship for building a strong public image. Apart from using different media in order to influence the public; the comany also deploys lobbying, printing success stories in the newspaper, launching products, posting particular achievements online and by sponsoring UN HUNGER FOOD PROGRAM for providing food to needy people. Recently the company was nominated as the great place to work for individuals and was awarded an award of Britain Top Employer. Such measures play critical role in achieving a competitive edge, attracting high calibre individuals, creating and delivering superior customer value; moreover protecting the well being of the company in the time of crisis. Yum! Brands which is the parent of KFC has formed an Animal Welfare Advisory Council whose role is to get information and advice based on relevant scientific research. The company also obtains positive headlines in the media by showing the commitment to the environment and by productively (efficiently, frugally) using the natural resources. In 2010 the company introduced fast food reusable container. The corporate policy is to reduce the usage of non-renewable resources, cut down the use of Styrofoam and carbon foot prints. In that respect the company is using the concept of â€Å"Subsistence Economy†. The company has also developed guidelines, limitations, and rules (restrictions) for the suppliers in the broiler industry. The company is also proud to be a prominent player in the collaborative effort conducted by National Council of Chain Restaurants and the Food Marketing Institute in developing comprehensive guidelines for all species of farm animals. The company has also i mplemented programs in the area of poultry care and handling. The company has initiated partnership with Barnardo’s, the UK’s biggest charity supporting children and young people to address the issue of youth unemployment. The company is backing the United Nations’ World Food Programme against world hunger by raising over half a million pounds last year – that’s about 3.35 million meals for  children in some of the poorest regions of the world. The company is also implementing the concept of â€Å"product liability† where the manufacturer is responsible for the faulty product or any damages made by the product to the consumer. In the past the companies were sued, dragged in court and evicted on ignoring the product liability obligations. For instance when considering the tragic tampering case in which eight people died from swallowing cyanidelaced capsules of Tylenol; a Johnson & Johnson brand. The company knew that the pills were altered in some stores not in the factory so it decided to recall all of its products. The total recall cost was $240 million in earnings but in the longer run such initiative strengthened customer’s confidence, trust and loyalty in the company. It shows the importance of managing public relations in crisis to preserve the favourable image of the organization. KFC bought the best quality chicken from UK Farms that meet Red Tractor Standards. The company has decided to cut the level of saturated fat by 25%, use of plastic by 17%, use of Styrofoam by 62% and invested  £1 million annually on replacing palm oil with rape seed oil. The company also provides all the nutrition information on the internet so that the consumers are aware about their calorie intake and has reduced the use of salt on menu board. All these initiatives show the dedication of the company towards protecting the long-run welfare of the community and customers. The company was recently conferred with an honorary award of Carbon Trust Standard for continued CO2 reduction. In 2009 the company opened first eco-store with salient energy saving features. CONCLUSION & RECOMMENDATIONS Based on primary and secondary research; it can be deduced that the company has taken best initiatives to build strong public image, influence people buy their products by effectively leveraging the selective relationship management and in improving work place practices from employment and production perspective. As the study suggests that the company knows the overall impact of its operations on Environment, health of the consumer and reputation of the organization. So it has taken measures to curb the environmental pollution by decreasing the use of plastic and Styrofoam,  reducing calories, saturated oil and fats in the food by replacing palm oil with rape seed oil, reducing salt, providing nutrition information to the consumers, obtaining high quality chicken from british farms and by modifying the nutritional profile of the menu on consistent basis. As suggested in earlier part of analysis the company is also funding the United Nations World Food Hunger Program, joined charity in order to help the unemployed youth and reducing the use of non-renewable resources to certain extent by building eco-stores with some energy saving features. The company is making a significant contribution in the well being of the society and in preserving the natural climate by reducing carbon footprints. All these initiatives are the premium examples of how organization’s create and maintain profitable customer relationship by using public relations, societial marketing and customer relationship management. When observed from the business perspective; the company is operating within a highly saturated market not showing any signs growth for the future. The company can increase the share of their customers by closely analyzing the other cultural values and perceptions. As the company is operating worldwide it can add new products to menu board by undertaking global cultural research analysis and consequently creating superior customer values shaped by consumer’s needs, wants and demands by observing culture. Based on my own judgement it seems like company’s policy is to sell everything to everyone. They should focus on particular segment of the market, closely analyze their needs, carefully select the customers and deliver superior customer value to capture back the value in return. As United Kingdom is the country with rich diversity; so all these issues should be taken into consideration when creating superior customer value, selecting the appropriate communication channel for positioning the product or targeting the customer, crafting an effective message for the public for communicating the merits of the product and designing loyalty scheme. In analysis it has been discovered that the company hasn’t been able to develop customer loyalty and retention programs beyond offering consistently high value and satisfaction. Now a days companies offer â€Å"frequency marketing programs† whereby they reward customers for buying more or in bulk. For instance airline companies offer frequent flier programs, hotels provide room upgrades to regular guests and supermarkets give patronage discount to valuable customers. KFC isn’t  implementing such schemes to reward customers for their loyalty and commitment. The company can issue membership cards with certain validity providing special discounts for generating revenue and increasing sales. REFERENCES Valentin, E. K.,†SWOT Analysis from a Resource-Based View,† Journal of Marketing Theory and Practice, Vol. 9, spring, pp. 54-68, 2001. Valentin, E.K. and Jerald T. Storey, â€Å"R.C. 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Relationship Marketing. Prentice Hall. Harvard Business Review (2001) Customer Relationship Management. Harvard Business School Press. Johns, N. (1999). ‘What is this thing called service?’ European Journal of Marketing, 33(9/10), 958-973. Kelly S (2000). ‘Analytical CRM: the fusion of data and intelligence’. Interactive Marketing, (3), 262-267. Peppers, Don, Martha Rogers and Bob Dorf (1999). Is your company ready for one-to-one marketing, Harvard Business Review (Jan-Feb). Steinman, Christine, Rohit Deshpande and John U Farley (2000). ‘Beyond market orientation: When customers and suppliers disagree’. Journal of the Academy of Marketing Science, 28 (1), 109-119. http://www.fundinguniverse.com/company-histories/KFC-Corporation-Company-History.html http://kfc.co.uk/ http://www.kfcdevelopment.co.uk/assets/KFC_Sustainability_EPCs.pdf http://www.youtube.com/watch?v=73H5Bs2pDuQ&feature=player_embedded#at=15 http://www.kfc.com/menu/

War Crimes Against Harry Truman - 1743 Words

War Crimes against Harry Truman Over the course of time there has always been a debate on whether or not Harry Truman should have been convicted of war crimes after the drop of the atomic bombs on Hiroshima and Nagasaki. People believe Truman was innocent, but at the same time a large amount also believe he should have been punished for his actions. Which side one believes to be true depends on the perspective of the situation. An American might believe President Truman was justified for allowing the atomic bombs to be dropped in order to save hundreds of American soldiers. From the point of view of a Japanese, dropping this massive, deadly, destructive bomb on a town of innocent citizens would be considered inhumane. War crimes are defined by the ICRC as any action that is carried out during war that violates the International Rules of War. It can also be defined as launching an attack knowing that it will cause incidental loss of civilian lives, or inflict injuries on them. Harry Truman violated not one, but man y of the sections to the International Rules of War. Murdering thousands of Japanese, sending others to internment camps, and dropping â€Å"Little Boy† and â€Å"Fat Man† onto a nonmilitary base, and dropping the bomb for his own selfish needs (preventing the spread of Communism) are all reasons Truman could have been convicted. Murder is one of the most obvious sections of war crimes that Truman violated when the atomic bombs were dropped. In the International Rules ofShow MoreRelatedThe Bombing of Hiroshima and Nagasaki700 Words   |  3 PagesThe Bombing of Hiroshima and Nagasaki The United States was completely unjustified in dropping the atomic bomb because it was used so we could have a sense of â€Å"power† over the rest of the world. President Harry Truman had paid no heed to his prior statements as to the intended use of the bomb; and not only had it violated the Hague Convention, but it also caused lifelong repercussions for Japan’s land and people. The United States, nearly 70 years later, has yet to apologize to the victims orRead MorePresident Truman and the First Atomic Bomb Essay1193 Words   |  5 PagesAtomic Bomb Essay In 1945, World War Two was coming to an end. Following Adolf Hitler’s suicide, and Nazi Germany’s unconditional surrender on May 7, 1945, the war in Europe was finally over. The allies began began postwar planning for future, as well as establishment of post-war order and peace treaties issues. America’s war wasn’t done yet as they were still fighting Japan, eventually pushing them back to their main islandRead MoreAntigone Essay1186 Words   |  5 Pagesdecisions by Harry S. Truman and Edward Jenner. There was success but there was also consequences in doing these wrong things. In any event, in some situations, it is right to do the wrong thing for the right reasons. In Sophocles’s play, Antigone, the main character Antigone makes the conscious decision of doing what she thinks is right for her family. After Pericles’ death, Antigone and Ismene are arguing and Antigone exclaims, â€Å"But I will bury him; and if I must die, I say that this crime is holyRead MoreThe Atomic Bomb Of Hiroshima And Nagasaki1364 Words   |  6 Pageswas received and accepted by America on the 15th of August and the war against Japan had ended. Harry S. Truman, the man responsible for dropping the bombs claims it ended the war more efficiently and was in fact the best option but many suspicions arose as news from Japan came to light and the utter destruction of Hiroshima and Nagasaki was revealed. It was never formally called a war crime but it should have been. A war crime as defined by the statue of the International Criminal court are ‘seriousRead MoreThe Dropping Of The Two Atomic Bombs On Japan919 Words   |  4 Pagesinfamy—the United States of America was suddenly and deliberately attacked by naval and air forces of the Empire of Japan.† Before World War II had taken place, Japan and China had started to fight against each other, thus leaving the United States in the middle of the two countries at war. Craving to have relations with China, the United States aided the Chinese against Japan. Japan was not too pleased of the United States backing of China. â€Å"The United States was the main supplier of the oil, steel,Read MoreHarry S. Truman For Defeating Japan s Barbaric Regime And Ending The Bloodiest War1641 Words   |  7 Pagessave many, it may be difficult to discern whether doing so would be moral or not. However, when Harry S. Truman was forced to decide whether or not to drop the atomic bombs on Japan, the moral choice was clear: dropping the bombs was the most viable option available that would end World War II, minimize casualties on both sides of the war, and ensure American victory. Every other option available to Truman would have resulted in a much greater loss for the people of both Japan and the Un ited StatesRead MoreEffects Of The Atomic Bomb On Hiroshima Japan1038 Words   |  5 PagesSawyere Lamontagne December 2nd, 2015 Prof. Richmond Engwr 300 Girls of Atomic City August 6th, 1945 a bomb was dropped on Hiroshima Japan, forever changing the game of war and the lives of all two and a third billion(Alpha Wolfram). The atomic bomb was a new invention in like the world has never seen. This bomb nicknamed Little Boy alone killed or injured over a hundred and fifty thousand people. This followed by another bomb, Fat Man, being dropped on nagasaki, killed or injured anotherRead MoreThe Atomic Bomb Essay1306 Words   |  6 Pageskilling of civilians. But that attack is only a warning of things to come. If Japan does not surrender, bombs will have to be dropped on her war industries and, unfortunately, thousands of civilian lives will be lost. I urge Japanese civilians to leave industrial cities immediately, and save themselves from destruction.† Harry S. Truman appears to be perfectly confident in his radio address to the world on August 9th 1945. Confident that he has made the right decision inRead MoreTruman s Decision On The Dropping Of The Atomic Bomb996 Words   |  4 PagesAldrin Ubaldo HIS 218-03 Atomic Bomb Paper Presidents Harry Truman’s decision on the dropping of the atomic bomb was the best decision he could make because having another land invasion similar to D-Day of June 1944 would risk more resources and soldiers’ lives on either side. Paul Fussell article states that in PFC E. B. Sledge memoir With the Old Breed at Pelieu and Okinawa. As the U.S military fights closely to the mainland of Japan, the fighting in the surrounding islands in Iwo Jima andRead MoreJulius And Ethel Rosenberg Was Spies For The Soviet Union Essay1333 Words   |  6 Pagesespionage. Just nine days after Julius was arrested, United States Forces engaged in the Korean War. It is important to understand not only how the Rosenbergs ended up in Sing Sing Prison but also how the United States came to the swift conclusion of sentencing the Rosenbergs to such a severe degree. This was, at the time, considered the most costly and most consequential act of espionage in the Cold War in the eyes of the public. The media would repeatedly churn out loaded accusations, giving the

Censorship Is A Way Of Regulating Information - 877 Words

Censorship Censorship is a way of regulating and examining various forms of media available to the general public. It occurs in different contexts, including books, films, art plays, radios, television programs, news, internet and communications. Censorship can be achieved by prior restraint, which consists of licensing system where a work has to be submitted before publication or court injunction prohibiting dissemination of information (Cohen 11). This type of censorship prevents certain materials from being published. On the other hand, censorship can also be achieved by suppressing ideas found to be objectionable or offensive (Cohen 11). This indicates that censorship can be practiced in different forms and it can occur either before or after a work’s publication. According to Mark Cohen â€Å"Censorship in Canadian literature†, a censor is one who exercises official supervision over morals and conduct (3). There is always a driving factor behind censorship. One might argue that censors want to control the minds of young, because students who read might learn to think and question them. This might be taken as a tool of government control over its citizens. Throughout history censorship has become an enemy of freedom and democracy (Cohen 5). However according to article 19 of the United Nations Universal Declaration of Human Rights; â€Å"Everyone has the right to freedom of opinion and expression† (United Nations). The First Amendment of the United States Constitution alsoShow MoreRelatedInternet Censorship and Government Regulation Essay1058 Words   |  5 Pagespeople bring up is that whether or not the government should regulate information on the internet. Both sides have valid points which form a reasonable argument. Some p eople would say that they need to because of the dangers lurking around in the cyber world but the reasons for why the government shouldn’t regulate the Internet outnumber the reasons for why they should. The federal government should not regulate or censor information on the internet because doing so violates the first amendment and citizen’sRead More Censorship in American Schools Essay1156 Words   |  5 PagesCensorship in American Schools You may not realize this but our government plays a large role in governing what sort of information America’s children are exposed to. The average American child receives the majority of their knowledge and education from school, so the information that is allowed to be taught is a very delicate and controversial issue. Literature is often altered or banned from public schools and libraries because they contain of vulgar language, excessive violence, or connotationsRead MoreCensorship in the US Essay1136 Words   |  5 Pagesthe Internet. Others believe that it is the parent’s responsibility to control and censor what their children are watching on the Internet and television. Censorship is the suppression of publishing information on the Internet or television (Naik). The government blocks only the content that is proved to be unfit for the public. Censorship is only used to a certain extent in the United States of America, but it is much more widespread in other parts of the world. Many people argue that the FirstRead MoreDo Internet Service Providers Have a Responsibility to Regulate the Content That Is Available on the World Wide Web? Is the Presence and Ease of Availability of Pornography to the General Public a Tribute to Free Speech1116 Words   |  5 PagesOver the years, society has found ways to record sexual experiences via paint, print, film and with recent technology, the Internet. Society has used every technological step forward to portray the sexual act. With each step forward this has increased the pornography forum to a broader audience. This audience is being propelled by a powerful urge to see images of sex. Nowadays pornography and t he Internet, go hand in hand. However who is regulating this material, the website companies want to makeRead MoreCensorship Of The World Wide Web1326 Words   |  6 Pages We live in the age of information, a world that has now been largely digitalized. The World Wide Web is the central component of our era, as it allows people across the globe to share and receive information in an instance. It used to take months before a letter from China could reach the U.S, now it just takes a second with E-Mail. This fast pace information processing has allowed human society to move forward with unprecedented speed, but it also raises many concerns for government authoritiesRead MoreInternet Censorship And The Internet941 Words   |  4 Pageslosing that freedom to government control in the form of Internet censorship. The arguments for and against Internet censorship are equally important and relevant. That is why it is important to remember that Internet censorship and surveillance is never justified, regardless of the issue it is meant to tackle. The arguments regarding this issue range from social issues, like stopping the distribution of child pornography or regulating gambling websites, to political issues, technological, economicRead MoreThe Censorship Of The Government In The Chinese Government1070 Words   |  5 Pagesclosed off to democratic societies. The Chinese government has successfully blocked out information such as the Taiwanese Independence and information of about the 1989 killings in Tiananmen Square (Rauhala 2016). They believe that this creates a â€Å"healthy internet† however this policy only impedes free speech. They believe that this creates a â€Å"healthy internet† however this policy only impedes free speech. The censorship of people was the ultimate goal of the legislation and while they have hired millionsRead MorePosition Paper: Censorship1391 Words   |  6 Pages Every structured society has suffered from some form of censorship of literature, art, or entertainment. Plato, the famous the famous Greek philosopher, was the first to record a method of censorship in a democratic society. In his Republic one of the first guidelines Plato designates is that The first thing will be to establish a censorship of the writers of fiction, and let the censors receive any tale of fiction which is good, and reject the bad; and we will desire mothers and nurses to tellRead MoreCensorship Filters The Media Within The World1574 Words   |  7 PagesDoes censorship filter the media within the world? Censorship has followed the free expressions of men and women like a shadow throughout history. Censorship is a way to filter the media in the world by suppressing unacceptable viewings or hearings by not showing, bleeping out, and covering the distasteful parts. In ancient societies, China for example, censorship was considered a logical tool for regulating the political and moral life of the population. The term censor can be traced to the officeRead MoreSummary Of The Cultural Logic Of Media Convergence1469 Words   |  6 Pagestopics such as regulating media content, there is much up to debate about who is responsible for responding to this culture change. While companies and brands can decide how much to regulate their content to an audience, ultimately the most responsibility is in the involvement of official government agencies. Jenkins mentions specifically the debate regarding the FCC’s actions around these restrictions. The Federal Communications Commission (FCC, for short) is responsible for regulating interstate and

Children With Child Abuse And Neglect - 877 Words

There are different types of programs that are available for youth and families where child abuse and neglect is apparent. Such programs that are available for young people and non-offending family members are Forensic Interviews, Family Services, Therapy Counseling, and Prevention Education. Other programs are available in different areas for families where youth are showing different types of outcries to help non-offending family members and the child get the help that is needed for several of reasons. Such other programs are that which is similar to as a residential treatment program. Each state has programs that are set up in dealing with the crisis of child abuse and neglect. Each state across the nation is looking into the different program in which they have and how the programs need to be adjusted so that the needs of the children and families are a better fit. Through the different programs that have been set up, some states have seen some improvements in the programs for child abuse and neglect while other state’s are seeing failures for the different programs. Through the research on the various programs, some states are seeing a decline in how many youth is having issues after becoming adults with going into the corrections system. While other states are not only seeing a rise on how many children are entering the state s custody due to child abuse and neglect, but the young people are going into the corrections system as adults. With some states seeing aShow MoreRelatedChild Abuse And Neglect Of Children1670 Words   |  7 PagesChild Abuse and N eglect Are you a child being abused by your parent? Do you need help? Why would any parent do that to their child or children? Child abuse is common, there are many different kinds of abuse. Most of the abuse occurs within the family. Child abuse is more than bruises and broken bones. While physical abuse might be the most visible, other types of abuse such as, emotional abuse and neglect, also leave deep, lasting scars on the children (Smith, M.A, Segal). Studies have shown thatRead MoreChild Abuse And Neglect Of Children Essay1276 Words   |  6 Pages Child Abuse and Neglect Tracy Vargas Arizona State University Child Abuse and Neglect In 2002 child protective service (CPS) agencies investigated more than 2.6 million reports of alleged child abuse and neglect (Harder, 2005, p. 1). The topic I have selected for this paper is child abuse and neglect. In this paper I will provide information of the findings for four different articles, I will include results provided by each article, finding similarities or dissimilarities. TheRead MoreChild Abuse And Neglect Of Children924 Words   |  4 PagesChildren get abused and die everyday of abuse and neglect. In 2005 1,460 died throughout the year of child abuse or neglect. The majority of kids who get abused are mostly 3 years or younger (77 percent ). The United States has one of the worst records, losing on average of 3-7 kids everyday to child abuse or neglect. Throughout the year there are referrals to the state child protective services that involve 6.6 million children, and about 3.2 million of the children are subject to an investigatedRead MoreChild Abuse And Negl ect Of Children1291 Words   |  6 PagesChild abuse and neglect are highly contested concepts, underpinned by and subject to a range of political and cultural factors particular to the society in which they occur. Therefore, child abuse and neglect are not phenomena that lend themselves to easy definition or measurement (Corby, 2006:79). This means that child abuse or neglect cannot be defined unless we take the cultural context into consideration, for what is considered to be abusive or neglectful in one society could be acceptable inRead MoreChild Abuse And Neglect Of Children1400 Words   |  6 PagesChild Abuse and Neglect Child abuse and neglect refers to any way in which someone harms a child. It also includes neglecting to protect a child from harm, potential harm, or allowing a child to witness violence or abuse to others. Harm to the child may or may not be intended. Children of abuse often have no one to turn to for help. Children often feel shame about their abuse or fear their abuser. The abuser may have threatened the child if he or she tells anyone about the abuse. It is up to adultsRead MoreChild Abuse And Neglect Of Children Essay1208 Words   |  5 PagesFrom the time I was a little girl, I’ve wanted a child. I always loved getting new toy baby dolls, and being able to take care of them as if they were really my children. Now, at age seventeen, I still can’t wait to be a mother. I’ve always promised myself that when I have a child of my own, he or she would be my top priority and I would love him or her with everything I have. Because of this mindset, it breaks my heart when I see or hear about children being abused and neglected by their parents. AccordingRead MoreChild Abuse And Neglect Of Children Essay944 Words   |  4 Pages Everyday, approximately 5 children die from abuse and neglect. Child abuse is when a child is physically injured or sexually abused. Sadly, there are many different forms of child abuse and neglect. There is physical abuse, sexual abuse, neglect, substance abuse, and emotional abuse. This abuse is very well known but most people don t realize that the people around you could be in that situation. Imagine being a young child, old enough to understand right from wrong, being abused and having toRead MoreChild Abuse And Neglect Of Children Essay2663 Words   |  11 Pagesâ€Å"There were 3.5 million reports of child maltreatment in the United States involving more than six million children† (Children’s Rights, 2014). In this paper, I will be talking about the various aspects of child abuse and neglect. A report of child abuse and neglect happens every ten seconds here in the United States. I thought about this idea for my paper because I have seen somebody in my family who suffered child abuse. I also thought about it because I used to work at a gymnastics center andRead MoreChild Abuse And Neglect Of Children1486 Words   |  6 PagesChild Abuse Child abuse and neglect is a really big problem in our society. Child abuse is physical maltreatment or sexual molestation of a child. Child abuse can also be emotional which in most cases people don’t notice it unless the child speaks up about it and tells an adult to get help. According to the U.S. Department of Health and Human Services Administration on Children, Youth Families, Child Maltreatment 2000, about three million children in America were involved in child abuse and neglectRead MoreChild Abuse And Neglect Of Children1846 Words   |  8 PagesThroughout history, children have been subjected to extensive abuse and neglect including but not limited to physical, sexual and psychological abuse and neglect alongside being provided with little to no rights. To combat this, individual states within our nation initiated Child Abuse reporting laws starting in 1963 which quickly spread throughout the nation. However, these laws oftentimes failed to adequately address and tr eat the extensive instances of child abuse and neglect due to lack of support

Us Postal Service †Insolvency Free Essays

The United States Postal Service: At the Brink of Insolvency Business 510 – Managerial Economics Final Project Submission February 25, 2012 Executive Summary this report takes a look at the United States Postal Service financial problems, which brought it to the brink of insolvency, after losing more than $25B in the last 5 years. It analyzes factors and performance and postulates corrective actions to bring USPS back to financial solvency. Both microeconomic and macroeconomic factors affecting the firm were analyzed while identifying its strengths, weaknesses, opportunities and threats. We will write a custom essay sample on Us Postal Service – Insolvency or any similar topic only for you Order Now USPS products and services demonstrate its strengths with its monopoly of the mailing industry and as a government franchise with an open line of credit with the Federal Financing Bank of up to $15B. Weaknesses include lack or very little diversity in its products and services, very restrictive delivery schedules and mandated large delivery points. Opportunities for USPS include increasing its product diversity taking advantage of the internet and other developing technologies it can use to improve its operating expenses. USPS is also experiencing external and internal threats. One of these threats is the wider acceptance of digital technology especially with the internet and email, smartphones and mobile internet, skyrocketing operating costs and inability to make timely changes and responses to mitigate continued losses without having to go through the Postal Regulatory Commission and Congress. In view of this, USPS is recommended to take a multi-prong approach to improve its revenues by increasing product pricing with its shipping services while staying competitive, using the theory of price elasticity of demand to appropriately price its mailing services and diversifying its products. Reduce operating costs by reducing numbers of employees, improving its fleet of vehicles to more fuel efficient vehicles or using alternate energy and also by reducing managed facilities and delivery schedules. And finally USPS needs to request Congress to give it authority to effect price changes resulting from out-of-the-ordinary changes in cost of fuel and other materials and resources used in fulfilling its mandate of providing a fundamental postal service to the nation. Overview Establishment and General Business Description Article 1, Section 8, clause 7 of the United States Constitution establishes the U. S. Postal Service. The current post office organization is operating under the provisions of the Postal Reorganization Act of July 1, 1971 designating the US Postal Service (USPS) as an independent establishment of the executive branch of the Government of the United States. The Postal Accountability and Enhancement Act, Public Law 109-435 made further revisions and the governing statute is codified in Title 39 of the United States Code. The same public law created the Postal Regulatory Commission (PRC) bestowing the PRC with regulatory and oversight obligations in the management and operation of the U. S. Postal Service (USPS Annual 10-K Report, 2011). The mandate of the USPS is to offer a â€Å"fundamental postal service† to the entire nation at fair and reasonable rates approved by Congress. This mandate is fulfilled by offering different level of mailing and shipping services throughout the country. As of September 30, 2011, total employees number to 557,251 career employees, down 4. 6% from the year before of 583,908 and 88,700 non-career employees (Annual Report to Congress, 2011). More than 85% of career employees are covered by collective bargaining agreements through one of the following four management organizations: American Postal Workers Union (APWU), National Association of Letter Carriers (NALC), National Postal Mail Handlers (NPMHU) and National Rural Letter Carriers (NRLCA). Products and Services The United States Postal Service divides their services into two broad categories: Market dominant mailing services and competitive shipping services. Mailing services include First Class Mail, Standard Mail, Periodicals and Package Services. Shipping Services include but not limited to Priority Mail, Express Mail, Bulk, Parcel Post and Bulk International Mail. Mailing services have set floor prices but generally doesn’t have any set ceiling price up to the allowed maximum size and weight limits (usually 70 pounds for each package). The same holds true for shipping services. All these services are offered through a network of more than 32,000 Post Offices, stations and branches, plus thousands of contract post units, Community Post Offices, Village Post Offices, retail establishments selling postage stamps and other services including the internet, www. sps. com. Additional services offered are sale of Postal Money Orders, leasing of Post Office boxes and sale of post cards or greeting cards. International mail and package services are also available to more than 190 countries (Annual Report to Congress, 2011). The current First-Class Mail stamp costs $0. 45 increased 2. 1% starting in January 2012 that was announc ed in October 18, 2011. Postal Service Mail pricing is set by the Board of Governors and approved by the PRC. Shipping services pricing is set by law covering both the institutional costs allocation and attributable costs. The institutional cost allocation is determined by the PRC and is currently set at 5. 5%. Thus the shipping cost is the sum of 5. 5% institutional costs (comparable to transaction costs) and attributable cost, representing the direct cost of the mailing or shipping services based from the weight and size of the package (USPS Annual 10-K Report, 2011). Current Financial Statement For the fiscal year ending September 30, 2011, the United States Postal Service reported a net loss of $5. 067B from their operation, an improvement compare to the previous year’s loss of $8. 505B. This is despite a reduction of 4. % in the number of its career employees from 583,908 to 557,251 (USPS Annual 10K Report, 2011). Just like any other private businesses, the USPS was also greatly impacted by the global economy especially the deep and prolonged economic recession of 2008. Additionally, with improvement in technology, wider availability of internet broadband services, lower cost of personal co mputers, prevalent use of online banking and also surge in offering of online funds transfers, which not only offers convenience and speed but virtually free, has directly compete and won over some of the mailing services of the USPS. Mail volume deliveries have decreased by 5% in the last two years, 2011 and 2010 and the year before, in 2009, the decrease was a staggering 12. 8% (USPS Annual 10K Report, 2011). The expansion of mobile internet coupled with smart phones will only worsen USPS declining mail volume in the future. Finally, one of the biggest operating expenses of USPS besides transportation costs and plant equipment and facilities is employee wages and retiree benefits. USPS employment costs makes up approximately 80% of its total operating costs (Kosar, 2012). Employee wages and retiree benefits costs are significantly impacted by wage inflation, health benefit premium increases, retirement and workers’ compensation programs, and cost-of-living allowances. In the last 5 years, the USPS suffered a total net loss of more than $25 billion including $21 billion of expenses for the pre-funding of the Postal Service Retiree Health Benefits Fund (PSRHBF) mandated by Public Law 109-435 (USPS Annual 10K Report, 2011). USPS current total debt as of September 2011 is at $13B which is only $2B from its statutory limit of $15B set by 39 U. S. C 2005(a) (Kosar, 2012). Financial statements reported to Congress for the fiscal year ending September 30, 2011: Years ended Sept. 30, 2011Percent change from preceding year (dollars in millions) 2011 2010 2009 2011 2010 2009 Operating revenue $ 65,711 67,052 $ 68,090 (2. 0%) (1. 5%) (9. 1%) Operating expenses * $ 70,634 $ 75,426 $ 71,830 (6. 4%) 5. 0% (7. 6%) Loss from operations $ (4,923) $ (8,374) $ (3,740) Operating margin (7. 5%) (12. 5%) (5. 5%) Net loss $ (5,067) $ (8,505) $ (3,794) Purchases of capital $ 1,190 $ 1,393 $ 1,839 (14. 6%) (24. 3%) (7. %) Property and equipment Debt $ 13,000 $ 12,000 $ 10,200 Interest expense $ 172 $ 156 $ 80 Capital contributions of $ 3,132 $ 3,132 $ 3,087 U. S. Government Deficit since reorganization $ (22,072) $ (17,005) $ (8,500) Total net deficiency $ (18,940) $ (13,873) $ (5,413) Number of career employees 557,251 583,908 623,128 (4. 6%) (6. 3%) (6. 0%) Mail volume (pieces in millions) 167,934 170,860 176,744 (1. 7%) (3. 3%) (12. 8%) New delivery points served 636,530 739,580 923,595 *P. L. 112-33 had a net impact of a $5. 5 billion reduction of expenses in 2011. P. L. 111-68 had a net impact of a $4. 0 billion reduction of expense in 2009. Graphical representation of USPS operating revenues and expenses from FY 2004 – FY 2011 Market Structure Monopoly Salvatore D. (2012) defined a monopoly market as â€Å"an organization in which a single firm sells a product for which there are no close substitutes† (p. 388). And of the four sources of monopoly cited (Salvatore, p. 390) is one established by a government franchise like the United States Postal Service. Not all of USPS products and services are monopolized. USPS monopoly is only in their mailing service referring to as its â€Å"dominant mailing service†. No other delivery service company in the industry is allowed to deliver mail. And this includes delivery service companies like UPS and FedEx. Mailing services includes First Class Mail, Standard Mail, Periodicals and Package Services. The USPS’s has monopoly over letter delivery, mailbox monopoly and the ability to suspend the delivery in certain areas. It enforces this monopoly with its armed postal inspectors who can conduct searches and seizures if it suspects breach of its monopoly. The only exceptions to this monopoly are â€Å"letters accompanying cargo† and â€Å"letters of the carrier† (interoffice correspondence) including bicycle messengers and overnight deliveries (Giddens, 2003). Monopolistic Competition Is defined, â€Å"as the form of market organization wherein there are many sellers of a heterogeneous or differentiated product and entry into and exit from the industry are rather easy in the long run† (Salvatore, D. , p. 396). Although the United State Postal Service does have a monopoly on â€Å"mailing services† it however does not have monopoly over â€Å"shipping services† which it shares with FedEx and UPS. However, this non-monopolized â€Å"shipping service† cannot be classified as â€Å"Monopolistic Competitive† market as there are only few sellers offering the products or services. Additionally, the same products and services are basically homogeneous. Instead it is classified as an oligopolistic market. Oligopoly Is defined, â€Å"as the form of market organization in which there are few sellers of a homogeneous or differentiated product† (Salvatore, D. , p. 412). Products and services offered by the U. S. Postal Service in its â€Å"Shipping Services† division is classified as an oligopoly market. It shares this â€Å"shipping services† market with United Parcel Service and FedEx. With very few firms in the shipping industry, all three (USPS, UPS, and FEDEX) seems to operate more like interdependence firms rather than rivalries. This is evidence by the collaborating services of USPS and UPS called â€Å"UPS Basic† while the one between USPS and FEDEX is called â€Å"SmartPost†. This interdependency operation between these three firms mutually benefits all parties. Although it may look like USPS is getting the shorter end of the deal, but by conducting an incremental analysis it will show USPS is just actually synergizing its required mandate of providing fundamental postal services. On the other hand, UPS and FEDEX benefit also from the consolidation by sharing their â€Å"not so profitable† area of their shipping services to USPS to ensure continued services to their customers and at the same time customer loyalty. Competition and Alliances There are a number of communications media competing for the same types of transactions and communications in the mailing and delivery services industry. These include newspapers, telecommunications, televisions, e-mail, social networking and online electronic funds transfers. For the shipping services intense competition is offered by United Parcel Service and FedEx Corporations (USPS Annual 10K Report, 2011), although at the same time these two competitors are also its alliances as described above. United Parcel Service (UPS) Financial comparison Below is UPS’s financial statement for the last three years 2008 to 2010. Comparing U. S. Post Office 2010 and 2009 annual total revenues, UPS’s 2010 is only 73. 2% to that of the U. S. Post Office while its 2009 revenue is only 66. 53% to that of the U. S. Post Office. This is proof positive even though the U. S. Postal Office is generally a local national firm, it has larger revenue than a multinational firm like UPS. However, when comparing operating expenses the U. S. Post Office edges UPS by a very large margin. U. S. Post Office total operating expenses of $75. 426B for 2010 more than doubles UPS’ $31. 989B. And for 2009, U. S. Post Office’s total operating expenses of $71. 83B dwarfs UPS’ $31. 692B! While UPS posted a Net income of $3. 488B and $2. 152B in 2010 and 2009 respectively, the U. S. Post Office posted a Net Loss of $8. 374B and $3. 74B in the same years. Income Statement All numbers in thousands Period EndingDec 31, 2010Dec 31, 2009Dec 31, 2008 Total Revenue 49,545,000 45,297,000 51,486,000 Cost of Revenue11,682,000 9,804,000 11,878,000 Gross Profit 37,863,000 35,493,000 39,608,000 Operating Expenses Research Development- – – Selling General and 30,197,000 29,945,000 32,412,000 Administrative Non Recurring- – – Others1,792,000 1,747,000 1,814,000 Total Operating Expenses- – – Operating Income or Loss 5,874,000 3,801,000 5,382,000 Income from Continuing Operations Total Other Income/3,000 10,000 75,000 Expenses Net Earnings Before 5,877,000 3,811,000 5,457,000 Interest and Taxes Interest Expense354,000 445,000 442,000 Income Before Tax5,523,000 3,366,000 5,015,000 Income Tax Expense2,035,000 1,214,000 2,012,000 Minority Interest- – – Net Income From3,488,000 2,152,000 3,003,000 Continuing Ops Non-recurring Events Discontinued Operations- – – Extraordinary Items- – – Effect Of Accounting Changes- – – Other Items- – – Net Income 3,488,000 2,152,000 3,003,000 Preferred Stock And Other Adjustments- – – Net Income Applicable3,488,000 2,152,000 3,003,000 To Common Shares Product and Services comparison UPS products and services are homogenous to U. S. Post Office products and services with the exception of mailing services in the United States. UPS is basically a package delivery company (shipping services) providing transportation, logistics and financial services in the United States and in other 220 countries. It also provides letter and document delivery but only those considered time constraint delivery exempted by the U. S. Post Office from its mailing service monopoly. Unlike the U. S. Post Office â€Å"shipping services†, UPS operates internationally thus providing import and export logistic services throughout the world. It also provides various technology solutions for automated shipping, visibility, billing, distribution centers (to various industries like healthcare), technology, retail/consumer and a portfolio of financial services. FedEx Financial comparison Below is FEDEX’s financial statement for the last three years 2009 to 2011. Comparing U. S. Post Office 2011 and 2010 annual total revenues, FEDEX’s 2011 is only approximately 59. 81% to that of the U. S. Post Office while its 2010 revenue is only approximately 51. 80% to that of the U. S. Post Office. Just like with UPS, FEDEX annual revenue is just barely a little over half of the U. S. Post Office annual revenue. However, U. S. Post Office Operating Expenses more than triples FEDEX annual operating expenses hence resulting in huge annual Net Loss to the U. S. Post Office while FEDEX posted a Net Income of $1. 52B and $1. 184B in 2011 and 2010 respectively. Income Statement All numbers in thousands Period EndingMay 31, 2011May 31, 2010May 31, 2009 Total Revenue 39,304,000 34,734,000 35,497,000 Cost of Revenue14,266,000 11,908,000 12,672,000 Gross Profit 25,038,000 22,826,000 22,825,000 Operating Expenses Research Development- – – Selling General and20,59 8,000 18,852,000 18,899,000 Administrative Non Recurring89,000 18,000 1,204,000 Others1,973,000 1,958,000 1,975,000 Total Operating Expenses- – – Operating Income or Loss 2,378,000 1,998,000 747,000 Income from Continuing Operations Total Other Income/(27,000)(25,000)15,000 Expenses Net Earnings Before2,351,000 1,973,000 762,000 Interest And Taxes Interest Expense86,000 79,000 85,000 Income Before Tax2,265,000 1,894,000 677,000 Income Tax Expense813,000 710,000 579,000 Minority Interest- – – Net Income From1,452,000 1,184,000 98,000 Continuing Ops Non-recurring Events Discontinued Operations- – – Extraordinary Items- – – Effect Of Accounting Changes- – – Other Items- – – Net Income 1,452,000 1,184,000 98,000 Preferred Stock And Other Adjustments- – – Net Income Applicable To1,452,000 1,184,000 98,000 Common Shares Product and Services comparison FEDEX product and services are also similar to UPS and with USPS’s shipping services. Its services are divided into four segments: FEDEX Express, FEDEX Ground, FEDEX Freight and FEDEX Services. FEDEX Express, Ground and Freight generally deals with domestic and international shipping services while FEDEX Service provides sales, marketing , administrative, information technology and customer service support services including copying and digital printing services. Economic Factors Macroeconomic Factors Unemployment and recession The greatest recession in U. S. history since World War II was declared to have started as early as December 2007 and officially over by June 2009 per National Bureau of Economic Research (Beatty, A, Sept 2010). During the start of the recession, unemployment was at a 5. 0% (Dec 2007) and reached its peak of 10% in October 2009. However, these unemployment figures are misleading because as per Bureau of Labor and Statistics, â€Å"Unemployment† is defined as people who do not currently have a job, have actively looked for work in the past four weeks (from the time when the report is prepared) and are currently available for work (Amadeo, n. d. ). It also includes people who are temporarily laid off and waiting to be called back to work. People who are unemployed and have not looked for job in the last four weeks (from the time the report is prepared) are removed from the labor force and are not counted as unemployed. The Bureau of Labor and Statistics also releases â€Å"Alternative measures of labor underutilization† report divided into 6 sections as follows: * U-1 Persons Unemployed 15 weeks or longer as a percent of the civilian labor force * U-2 Job losers and person who completed temporary jobs as a percent of the civilian labor force * U-3 Total unemployed as a percent of the civilian labor force (official unemployment rate) * U-4 Total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers * U-5 Total unemployed plus discouraged workers, plus all other person marginally attached to the labor force, as a percent of the civilian labor force plus all person marginally attached to the labor force * U-6 Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force Of these six sections, the focus is on the U-3 and U-6 figures. As of December 2008 the official unemployment rate as per BLS Report (U-3 figure) is at 7. 3% while the U-6 figure is at 13. 5%. The difference is 6. 2% meaning while 7. 3% of the work force is being reported as officially unemployed, another 6. 2% are not. And this unreported 6. 2% are mainly those who have stopped looking for jobs or those who hold part time jobs. By June 2009, when the last economic recession was officially declared over, the U-3 and U-6 figures are 9. 5% and 16. 5% respectively. And for the year ending, December 2011, U-3 was reported at 8. % and U-6 at 15. 2% for a difference of 6. 7%. This difference indicates 44. 0% (6. 7% / 15. 2%) of the unemployed is not reported in the official unemployment rate. This is an indication although unemployment rate has been reported to decline from its peak of 10% in October 2009 to 8. 5% in December 2011, there are still far more unemployed people being unreported or have continuously decided not to join the workforce. High unemployment adversely affects the national economy in general including delivery and shipping services firms like USPS. With consumers having less confidence and less money to spend, there is less business for delivery of goods. When unemployment rate is high, there are fewer consumers while still those employed has less spendable money. Hence, retailers’ sales decline so is the order of replacement merchandise directly translating to reducing shipping services both for the retailers and consumers. In short, there will definitely be a negative impact on USPS revenue. Cyclical changes in the economy, i. e. recession and inflation is nothing new to USPS, however the effect of modern technology like the personal computers and internet is. At the height of the recession, 2009, USPS revenue declined by 9. 1% over the previous year with a total net loss of $3. 74B followed by another $8. 473B net loss in 2010. Unemployment rates peaked from 7. % in January of 2009 to 10% in October 2009 and declined to 9. 4% in December 2010 were in parallel with these revenue losses. The bulk of USPS operating expenses is mostly from its employee wages and retiree benefits and transportation. Of these, employee wages and retiree benefits are the least elastic. With more than 85% of its employees covered by Collective Bargaining Agreements (CBA’s), USPS is strictly constrained to react promptly to sudden changes to the economy to reduce its operating expenses, i. e. laying off employees or reducing retiree benefits. Inflation Inflation is defined as a sustained increase in the general level of prices for goods and services. It is measured as an annual percentage increase. As inflation rises, every dollar you own buys a smaller percentage of a good or service. The value of a dollar is never constant and it is referred to as its purchasing power. With inflation there is a decline in the purchasing power of the dollar (Investopedia. com) For USPS, inflation also results in adverse effects on its revenues but mostly it affects the cost of health benefits it has to cover for its employees and retirees. For its operations, the cost of fuel also greatly affects its operating expenses. Cost of living allowances and workers’ compensation programs also add to increased operating expenses. But the most negative impact is the inability of USPS to readily adjust its product and services pricing based from inflation as it requires legislative actions to do so. Government Legislations Since USPS is a government owned firm, it operates within the guidelines of public laws. Product and services pricing are approved by Congress. In addition, delivery schedules and delivery routes are also regulated by the Postal Regulatory Commission. With the implementation of Public Law 91-375 commonly known as the Postal Reorganization Act of 1971, the USPS became a self-supporting, wholly governmental entity designed to cover its operating costs with revenues generated through providing fundamental postal services to the entire nation (Kosar, 2012). It does not receive annual appropriation from Congress for its operating budget except for the annual $100M congress pays to compensate USPS for the revenue losses incurred for free mailing privileges to blind persons and overseas voters, as directed by Congress. The Postal Accountability and Enhancement Act of 2006 (PAEA) established the Postal Service Retiree Health Benefits Fund (PSRHBF) and required USPS to prefund its future retirees’ health benefits at a cost of approximately $5. 5B per year for 10 years with remaining balance amortized in the subsequent next 40- year period. For FY ending 2011, the unfunded obligation to this fund is at $46. 2B (the accuracy of this amount is still being debated depending on what valuation method is used) (Kosar, 2012). Below is the table for the RHBF payments under the PAEA: Table 1. Postal Service Retiree Health Benefits Fund Payments Under PAEA Fiscal Year Payment Due Per PAEA (billions) Status of Payment 2007 $5. 4 Paid in full. 2008 $5. 6 Paid in full. 2009 $5. 4 $1. 4 billion paid 2010 $5. 5 Paid in full. 2011 $5. 5 No payment 2012 $5. 6 Due September 30, 2012. 2013 $5. 6 Due September 30, 2013. 2014 $5. 7 Due September 30, 2014. 2015 $5. 7 Due September 30, 2015. 2016 $5. 8 Due September 30, 2016. Source: Postal Accountability and Enhancement Act (P. L. 109-435,  §803; 120 Stat. 3251-3252; 5 U. S. C  §8909(d)(3)(A). ) Due to solvency problems, Congress reduced the FY 2009 payment amount to $1. 4B (P. L. 111-68) while in FY2011, Congress delayed the payment to August 1, 2012 as per H. R. 112-331. By front loading the RHBF, USPS has switched from funding its RHBF from â€Å"out of pocket† cost to pre-funding. It’s this prefunding causing a tremendous financial strain on the firm. It’s also an indicator on how much leverage and control government legislations have over the firm. And this is just one of the two biggest entities having control over the firm’s operations. The other one is employees’ unions. Collective Bargaining Agreements More than 80% of USPS operating cost is due to its employees’ wage; and more than 85% of its employees belong to one of the four unions or referred to as management organizations, i. e. , APWU, NALC, NPMHU and NRLCA. Unfortunately for USPS even though it enjoys benefits from federal regulations like monopoly of mailing services and having the ability to borrow money from the Federal Financing Banks up to $15B or as set by Congress; the same federal laws also put constrains in its ability to increase revenue by increasing prices without prior approval; or decreasing its operating costs by reducing mail delivery schedule; or closing non-performing post offices; or by having power to control labor costs. Statutory processes for resolving disputes between labor and management frequently results in arbitrators being empowered to make binding decisions heavily favoring employees (USPS Annual 10K Report, 2011). With declining revenues since 2007, USPS has been unable to reduce employee numbers to desired sustainable strength, its main operating cost, without having to rely solely on attrition or buy outs due to collective bargaining agreements that heavily favor employees. Future strategy calls for attr ition or reduction in employees’ numbers to an additional 120,000 positions by FY2015. However, USPS is unable to achieve this without overriding current CBA’s and it doesn’t have the power to do so. Microeconomic Factors Personal Computers and Internet In their 2009 annual report, according to the Bureau of Labor and Statistics, approximately 68. 7% percent (81. 939 million households) of all U. S. households have internet access. Out of this 68. 7%, 63. 5% uses broadband service while 4. 7 % uses dial up service with the remaining 0. 4% using either satellite or dish access (BLS, 2010). And the numbers will only continue to grow as personal computers become more affordable and internet services continue to be made available in the rural areas. With internet comes email and social networking services. Although email is a differentiated product from regular paper mail or commonly referred to as â€Å"snail mail†, its purpose and function is completely the same. In short, email is almost a perfect substitute product for regular paper mail. The decline in first-class mail volume started to take center stage when the volume of First-Class mail, where USPS gets the majority of its money from, fell below junk mail volume for the first time in 2005 (Leonard, 2011). Total mail volume declined 20% between 2006 and 2010 resulting in a total net income loss of $25B. 1-From 2011 Report on Form 10-K USPS So is email killing USPS? Although decline in First-Class mail alone cannot postulate this to be accurate, there is however undisputed evidence email has delivered a severe financial blow to USPS. Like this is not serious enough yet, digital communications continue to evolve and quickly becoming mainstream. Mobile phones or smartphones are not only capable of making a phone call but also able to send emails just about anywhere they can find service signals from their providers. The phone can also be used to send text (â€Å"texting†), providing not only faster communication than regular paper mail but even better than regular email as it requires no computer to access it and is in real time. To make matters worse for USPS, most businesses are already moving to â€Å"paperless† bill and payment delivery meaning the 20% decline in first-class mail volume in the previous years, not only will it be probably irreversible but will most likely worsen before it gets better. And then there is yet still another evolving technology that could also adversely affect USPS’s other business model, â€Å"shipping services†, and this is with the digital or electronic books. According to Amazon, the largest retailer on the web, Kindle books are just now starting to outsell printed books (Leonard, 2011). Everyday Low Pricing strategies If you are looking for the cheapest postal rate around the world, look no further than the U. S. Postal Service. For a universal rate of 44 cents (before January 12, 2011, where it rose to 45 cents), for the first ounce, a First Class letter mail can be delivered anywhere in the United States and its territories. In comparison, for the same letter mailed locally, in Norway it would cost the sender $1. 63; in Japan it would be $1. 06, in France it would be $0. 81, in Germany it would be $0. 77, in UK it would be $0. 74 and in Canada it would be $0. 61 (Annual Report to Congress, USPS, 2011). Like this is not cheap enough yet, the Standard Mail is even cheaper consisting mostly of advertising and periodical mails. So is everyday low pricing causing financially losses USPS? In comparison to other postal services it would seem so. An analysis of this dilemma is presented in the business strategies section of this report. Outsourcing and global competition Although most U. S. companies have adopted globalization and have included outsourcing in their strategy to compete in the global market, the U. S. Postal Service remains a sole government franchise operating only nationally. As such it does not include outsourcing as a part of its business model and do not compete globally. Business Analysis Current Financial Performance USPS current financial performance in the last 5 years and especially in the 2011 is in â€Å"dire straits†. With over $25B in net losses over the past five years including $21B of expenses for the prefunding of retiree health benefits, it ended 2011 with only $1. 2B in total cash and only $2. 0B of remaining borrowing capacity. The projected payments for the PSRHBF for 2012 is a staggering $11. 1B ($5. 5B for the deferred 2011 and $5. 6 for the upcoming 2012 contributions) and then there is the payment for workers’ compensation for approximately $1. 3B by September 30, 2012. Even with all the re-structuring tools available for the USPS put into place including price increases just recently approved, USPS will not be able to meet all its current year financial obligations. Unless, congress makes changes to the current requirements of prefunding USPS’ PSRHBF, the firm is technically insolvent even prior to the end of its 2012 accounting period and will remain so at least until 2016. Previous Financial Performance The last time USPS posted net income from its operations was in FY2004 ($3. 1B), FY2005 ($1. 626B) and FY2006 ($969M), (USPS Annual Report 2007). It was in 2006 P. L. 109-435 became a law relieving USPS of the $27B in pension liabilities for workers with military service (USPS workers with military pension used to be paid by USPS vice the U. S. Treasury) but at the same time USPS agreed to make annual payments of $5. billion for the next 10 years to build up a fund for future retirees. When this bill was signed into law, USPS was ecstatic. So for FY 2006, USPS finished the year with a net income of almost $1B. Little did it know it will be the last time USPS will ever finish the year in â€Å"black†! Future Financial outlook Futur e financial outlook for USPS is dimmer than ever. With decline in First Class mail volume continuously declining, there is no indication this is not permanent or worse yet decline more in coming years, even if the economy improve. So far USPS seems to be more focus on increasing its revenue by increasing prices in both of each services, i. e. , mailing and shipping services. At the same time, it also wants to reduce its operating expenses by reducing its number of employees and closing or converting some of its branches into â€Å"village post offices†. However, even with all these business strategies, USPS doesn’t seem to focus on how it can re-structure its business model to adapt to digital technologies and the use of Internet. Although, it has adapted its shipping services and selling of stamps into the digital world USPS is yet to make headways into a profitable business model. Business Strategies Product pricing One of the business strategies of USPS and usually most of businesses do is to increase product pricing everytime the end of the accounting period reports â€Å"Net Loss†! This seems to be a knee-jerk reaction since it’s the easiest logic to recoup â€Å"net losses†. And this is because supposedly increase in product pricing directly correlates to increase revenue thus increased profit or having to post â€Å"Net Income† instead of â€Å"Net Loss† at the end of each accounting period. However product pricing is not as plain and easy as it looks. In the case of USPS product pricing, the elasticity of each product pricing should be taken into account. USPS has validated the fact that technology, increased availability of broadband services, growing internet access in homes, declining prices in personal computers, and expanding mobile services has caused a decline in its mailing services. This is directly attributed to e-mails and online banking billing and payments. In short, email and other electronic online banking transactions, although differentiated from regular paper mail are direct substitute products. As such, it can be postulated increasing the price of USPS â€Å"mailing services† will not necessarily translate to increased revenues. With price elasticity of demand (EP), the more there is a close substitute to a product the higher is the elasticity of demand. This is shown in the below graph: Figure 2: Managerial Economics in Global Economy (Salvatore, D, 2010) With EP greater than one (highly elastic as shown on the upper portion of the blue demand line) the demand line indicates an increase in price (PX) will result in decrease in quantity demanded (QX). With decrease in quantity demanded means reduction in total revenue. Based from the mail volume decline since 2006 (when mailing was cheaper than last year and this year) up to the present it’s almost conclusive further increase in the cost of mailing will only exacerbate the decline in mail volume; making it easier for business managers to make the decision to switch to â€Å"paperless† bill statements and delivery. Although current statutory requirements limit pricing increase on â€Å"shipping services† (including mailing services) to rate of inflation, USPS should request Congress to include a direct authority for USPS to increase prices (with approval from the Postal Regulatory Commission, PRC) based from increased cost of transportation, i. e. , fuel, the same strategy used by the airline industry. The airline industry started using surcharges for baggage checked in when the cost of fuel surge to unsustainable levels. USPS should have the same authority to make time sensitive changes to its pricing as it deems necessary for its continued operations with the approval of the Postal Regulatory Commission (PRC). Even if given this authority, USPS should still consider the competition before it can raise shipping prices and by how much. By having the authority though, USPS can be a flexible firm able to respond in time to stop massive losses while waiting for Congress to give it an approval. Product diversity With technology, USPS has started to adapt the internet for some its product offerings. Customers can go at USPS. com and fill their forms online and even print their mailing or shipping stamps. Additionally, customers can also request home or station pick up by USPS meaning customers need not even to get out of their houses to receive mailing or shipping services. However, these shipping services are also available with USPS competitors like UPS and FEDEX and seem to be doing a better job than USPS. There is however, one product USPS offers that its competitors do not offer and this is Postal Money Order. U. S. Postal Money Orders are very popular and reliable people up to this day prefer them as a form of payment over credit or debit cards or even online fund transfer companies like Western Unions or Paypal. USPS should conduct a study on how to establish a business model allowing it to offer a digital version of its Postal Money Orders. With USPS monopoly on money orders this is almost a sure winner if it can design a digital or online business model for its money orders. In 2010, Paypal posted total revenue of $3. 4B and expects to double this revenue by 2013 (Galante, 2011). On the otherhand, Western Union posted a Net Income of $909. 9M (Yahoo Finance). With potential revenue at this level just from its money order business, USPS is posed to increase its annual business revenue tremendously compare to just increasing its product pricing. Resource utilization USPS resource utilization is obviously not at its optimal level considering the amount of losses it incurred in the last 5 years. Probably the worst resource underutilization is in the excessive number of employees and its huge fleet of gas guzzling trucks and delivery vehicles. USPS was very slow to adapt to new technology and didn’t quite see the effect of the internet with its mailing services and continued rising cost of fuel. This is in spite of the significant decline in First-Class mailing volumes as early as 2005 and the more than $100 a barrel of crude oil in 2008. USPS did not initiate to stop Saturday’s mail delivery until 2010 when it was already losing tens of billions in income. USPS tries to optimize its resource utilization by working interdependently with its â€Å"Shipping Services† competitors like UPS’ â€Å"UPS Basic† and FedEx’s â€Å"Smart Post†. However, USPS should strive instead to get as much of this business for itself instead of having to share it with its competitors. This doesn’t mean it has to get rid of this interdependency relationship as it helps in its resource utilization but should try to get as much as it can so as to enjoy the revenue for itself instead of sharing with others. And it can easily accomplish this through pricing, which it has an advantage over the competition. With oil price increases in 2008, USPS should have started switching or equipping its delivery vehicles either to more fuel efficient vehicles or those equipped to use Compressed Natural Gas (CNG). According to Consumer Energy Report. om (Rapier, 2009), based from EPA reports, a gallon of gasoline contains approximately 115,000 BTU’s of energy while a Standard Cubic Feet (SCF) of natural gas contains 1,000 BTU’s (hence 115 SCF of CNG equates to 1 gallon of gasoline). In November 2011, the national average price of gaso line was $3. 37 a gallon while for diesel it was $4. 01 a gallon (Consumer Report, 2011). On the same period, the price for natural gas is $8. 60 per thousand SCF for commercial rate and $4. 53 for industrial rate (EIA. gov, 2012). A thousand SCF of natural gas equates to 8. 7 gallons of gasoline or diesel (1,000 divided by 115), meaning had USPS converted some of its vehicles into CNG, it would only be paying approximately 98. 85 cents to equivalent gallon of gasoline or diesel at the commercial rate price, and even less if given the industrial rate price. At present, price of natural gas has declined although not significantly but it might as well be because on the other end of the spectrum the price of gasoline rose to almost $4 a gallon from $3. 37 in November 2010, an increase of 18. 7% and it is just starting to get worse. USPS has the largest civilian fleet of vehicles in the world numbering to 215,625 burning through more than 399 million of gallons of gasoline/diesel for a total of 1. 25 billion miles driven (Postal Facts, 2011); it could have easily saved tens of millions of dollars with the use of CNG. USPS should continue with its strategy of reducing its number of employees and post office branches or converting some branches into â€Å"Village Post Offices†. Additionally, it should also strive to reduce its delivery service from a 6-day to a 5-day delivery. Although this may sound like an easy feat to accomplish, i. e. , to reduce operating cost due to reduced mail volume, it is not. This is because although there has been a decrease in mail volume there is however an increase in delivery points. So the bottom line is although reducing operating cost is a positive step, USPS can only reduce it for so much and for so long before it starts failing in providing fundamental postal services to the nation; its primary mandate and reason for existence. The other strategy for USPS besides operating cost reduction is synergized on what it is currently accomplishing now and for the future. Cost Volume Profit Analysis Cost-Volume-Profit analysis or breakeven analysis is a process of determining the output where a firm breaks even or earns a target profit from the total revenue and total cost functions of the firm† (Salvatore, D. 2012). Unlike manufacturing or production firms, or any private firms, the USPS has a constant mandate to provide â€Å"fundamental postal service† to the nation. As such, it requires a minimum number of employees, material and other resources to accomplish this task, hence an absolute minimum operating cost. In private sector, when a firm CVP analysis indicates a decline in total revenue (TR) compare to total cost (TC), its tendency is to reduce TC until it is low enough to gain profit. Even better for the firm it has the option of totally abandoning some specific operations or productions if it cannot gain profit despite drastic reductions in TC. However, this is not the case for the USPS. With minimum requirements to provide fundamental postal service to the nation, the USPS cannot reduce its TC to the point it will cease some or even a single part of its operation, despite heavy net losses in income. When USPS is operating at a loss and has done just about everything to minimize its TC, its only other option is to increase the volume of its business to at least break even. With decline in mail volume still yet to hit bottom, USPS needs to venture to different products especially those taking advantage of the internet and other evolving technologies. It is only through additional products or improvement in current existing products USPS can increase volume of its business to at least cover its minimum operating cost. Strengths, Weaknesses, Opportunities and Threats Being a government own firm, USPS has some inherent strengths in its business model as follows: 1. Monopoly of the mailing service industry 2. Open Credit lines or borrowing up to $15B from the Federal Financing Bank, which can also be increased in due time with the approval of Congress 3. Large operating capacity with more than 33,000 facilities throughout the nation 4. A non-profit organization whose only financial objective is to break even giving it the strength to undermine the competition through low pricing 5. Highly resilient to cyclical changes in the economy brought by recessions and inflations 6. Modern technological network infrastructures and highly computerized distribution systems USPS should utilize its strengths to increase revenue especially with its business goal of only requiring breaking even. It can also flex its strength in pricing to beat the competition when it comes to its shipping services. With its large operating capacities it should plan to expand its business model to achieve â€Å"economies of scale†. USPS weaknesses also come mostly from the same institution that gave some of its strengths: 1. Large operating cost due to large required coverage in mail and shipping deliveries as mandated by Congress 2. Very little diversity in products and services despite large operating capacities and highly technological networked infrastructure 3. Very little to none bargaining power with employees management organizations or unions 4. Very restrictive operating schedules and product pricing flexibilities 5. Slow adaptability in a highly changing business environment brought by newer technology due to restrictions placed upon the firm by Congress through the Post Office Regulatory Commission 6. Large number inefficient fleet of vehicles 7. Very expensive employee pension and retiree health benefit plans Weaknesses in large number of inefficient fleet of vehicles unnecessarily contributing to high operating cost can be easily avoided with the use of alternate energy like CNG. Congress should give temporary authority to USPS to effect price changes as a result of out of the ordinary changes in fuel costs and other materials and resources it uses to fulfill its mandate. The two most readily available opportunities for USPS mostly come only in two forms, i. e. product diversity and more use of the internet as another source of business revenue. This can be as simple as developing a business model to the current postal money orders so it can be transformed to something like e-Money Order that can be used for online fund transfers the same as Paypal’s or Western Unions business model do. As for product diversity, USPS should start looking into expanding its shipping services to aggressively compete directly with UPS and FedEx. The biggest threat facing USPS is the continuing decline of its mailing services. Despite the big proposal of increasing prices supposedly supplementing losses, it’s more likely the more USPS continue to raise prices in its mailing services the sooner it will decline more. The threat of defaulting with its PSRHBF funding for this year and probably for the following years is imminent. The possibility of a government bailout seems to be very more likely starting this year and the years thereafter. USPS needs to face the reality of the internet technology and should start restructuring its business model so as to treat the internet as an ally instead of an adversary. Conclusion An expeditious and short term solution to the Unites States Postal Service current financial problem is way out of reach of the sole capability of the firm and requires a congressional legislation to make it happen. This specifically with the firms mandated annual $5. 5B prefund contribution to its PSRHBF where $11. 1B is due by September 30, 2012. In addition there is also the $1. 3B Workers’ Compensation Fund required to be paid to the DOL at the end of the fiscal year. To keep USPS financially solvent and operational at least for the time being, Congress should legislate to postpone payments to the PSRHBF and to the Workers’ Compensation for the next three years. This should give enough â€Å"breathing room† for USPS to stay â€Å"afloat† while at the same time implementing its multi-prong strategies of reducing its operating costs, increasing revenues, diversifying its products and improving its processes and methodologies to attract more customers. References: 1. Amadeo, K, (n. d. ) U. S. Economy, How is Unemployment Defined. Retrieved February 18 2012, from http://useconomy. about. com/od/supply/f/unemploy_define. htm. 2. Average gas prices – – November 21, 2011, Retrieved February 23, 2012 from http://news. consumerreports. org/cars/2011/11/average-gas-prices-november-21-2011. html. 3. Beatty, A, (September 20, 2010) U. S. 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