Core Insights - UPS has established a strong B2B parcel delivery model since 1907, creating a competitive moat due to its reputation for service and lower costs [1] - FedEx Ground, originally RPS, has grown from $35 million in annual revenue 40 years ago to over $35 billion today by introducing new features and technology [2] - The parcel market has evolved into three segments, with the lightweight B2C e-commerce segment now representing over 70% of the market, posing challenges for UPS and FedEx's traditional delivery models [3] Company Challenges - UPS faces a significant challenge in the B2C delivery market due to its unionized workforce, which makes it harder to compete with non-unionized companies like FedEx [4] - To regain market share and profitability, UPS needs to adapt its delivery model by integrating lower-cost last-mile delivery agents with its existing Teamster drivers [5] Proposed Innovations - The suggested innovation involves using Teamster drivers for middle-mile deliveries to UPS Stores, where independent gig workers can then handle final-mile deliveries using personal vehicles [6] - This model allows for efficient delivery within a five-to-10 mile radius, reducing the need for long commutes to sortation centers [6] - B2C parcels can be returned to UPS Stores the next day if undeliverable, streamlining the return process [7]