Nature

Strengths
Loyalty- Customers are not likely to switch to a new mail

Weaknesses

service Government restrictions- new entrants would have to overcome restrictions that the USPS has already surpassed Distribution Channel- The USPS is the only mail carrier in the United States that reaches every single address in the nation. This amounts to over 150 million residences and businesses. Buyers threat of backward integration- No threat of backward integration from consumers

Product differentiation- The USPS has already seen a 2%

Scope

drop (167 billion pieces of mail) in its first class mail this year alone. The collective drop amounts to 26% since since 2006. Switching Costs- Low Switching or no switching costs to consumers Ease of substitution- Similar to switching cost, the consumer has many options with which to substitute. Suppliers concentration- The setup of the USPS is such that it would be geographically unable to have supplier concentration

Internal

Opportunities

Number of buyers- Because of its strength in distribution,

Threats

Importance of the product to buyers- The USPS is losing

the USPS has access to a lot of addresses in the United States and the consumers that live there Many players of about the same size (no dominant firm)This presents an opportunity for the USPS to gain market share Fixed costs vs. variable costs- The majority of the USPS costs are fixed. If the USPS can transition some of the fixed costs into variable costs, they could increase their profit. Availability of substitutes- There are many suppliers available for the USPS to facilitate. Forward integration- If the USPS decided to cut out above suppliers, they could forward integrate.

Monday, October 10, 11

Positive

business with consumers Price sensitivity of buyers- The buyer has many additional options (UPS, FedEx, DHL) Relative price of substitute- Pricing is similar for substitutes Relative threat of substitute- Combining above two statements, in terms of quality and price, while there may be a few differences, it is relatively similar. Number of competitors- Three major competitors- (UPS, FedEx, DHL) Industry growth rate- Industry as a whole is declining Importance of product to buyers- With the advent of the internet, the product is becoming increasingly obsolete

Negative

External Internal