SWOT Analysis: Uber
MBA 686
SWOT ANALYSIS: UBER
John Brooks, Sara Vong, Ade Adesida, & Tyler Frankenfield.
ATSJ Marketing.
Benedictine University
STRENGTHS
The name Uber is synonymous with the ride service market.
Uber has enjoyed and capitalized upon first to market
advantages. Although Uber isn’t a market disrupter by the
strictest definition, as some have ascribed to it, it has
completely changed the ride service market, which has long
been dominated by cab companies (Christensen, Raynor, &
McDonald, 2015). Uber has distinct advantages over traditional
cab companies, where in many cities; expensive tokens are
required to operate (Salmon, 2011). The tokens also serve to
limit the fleet of cabs available, which is not in the best interest
of consumers. Consumers have noticed this, and as such have
voted with their wallets. Uber drivers use their own vehicles,
which makes for a large fleet. This means supply is not a
limiting factor. Unlike cab companies, Uber does not have
employees, rather it has independent contractors. This helps
reduce overhead costs even more, which are already low. This
allows Uber to pass along better pay to drivers, and better rates

to consumers (Worstall, 2014). In addition to saving money,
consumers benefit from the user friendly nature of being able to
pull out a smart phone, and have a driver there to pick them up
within minutes. Other conveniences include the ease of payment
via the app, a rating system that allows users to select highly
rated drivers, and customers can choose the level of service
(SUV, taxi, black car, etc.….). Although there is much debate
about exactly what Uber’s current value is, there is no debate
about whether or not it is a successful and valuable company.
This makes it an attractive company for many investors. In fact,
earlier this year Uber raised $3.5 billion from the Saudi
Sovereign Wealth Fund (Konrad, 2016). All signs point to Uber
being primed for expansion into new markets.
WEAKNESSES
Uber’s business process and product are simple and easily
replicated, and there is nothing Uber can do to stop competitors
from eating into their market share (Chan, 2015). Uber may
have gained a first mover advantage in the ride sharing market,
but with no barriers to entry, the market will become even more
competitive. Internationally, Uber has shown a weak
knowledge of local markets. As evidenced by the recent sale of
Uber China to local rival Didi Chuxing, local strategies are
required for local markets (Somerville, 2016). Uber tried to use
strategies that were successful in other markets and rushed entry
into China and Indonesia without an understanding of the
culture, business dynamics and consumers (Somerville, 2016).
Uber has already made significant investments in their
technology and research and development, and have undergone
a trial and error period that new startups will not have to endure
because they can learn from Uber’s mistakes and costs to their
reputation. Being a first mover means that Uber may have to
re-define their operating procedures and company policies in
each new market they penetrate which can be costly and take
time to correct once new features are required to remain
competitive through saturation. This significant investment
also means that Uber may not be able to make fundamental

changes that may be necessary to see any payoff in international
markets that have vastly different customs and operating norms.
The relationship between Uber and their drivers lacks
connection and there is little loyalty either way, especially
because the drivers carry the burden of the increased car
maintenance, fuel costs, increased insurance cost and inherent
risk of accident. The payout for the drivers may be too low
compared to the risks, and Uber does not offer many incentives
to keep drivers loyal to their brand versus a competitor. Uber’s
business model is based on the fact that drivers are independent
contractors, not employees of the company, so they do not
receive any benefits or incentives of a traditional employer. As
the employer/employee relationship become a bigger topic in
the ridesharing industry, Uber will continue to receive class
action lawsuits and political and governmental roadblocks as
they try to operate with all of the control of an employer,
without any of the tax, regulation or reciprocity to their drivers.
Similarly to employee loyalty, customer loyalty is also low and
it is hard to build. All else equal, Price is the only thing that
drives the consumer in remaining with Uber or switching to a
competitor. If customers feel like they have more incentives or
can get a better price from a different ride share competitor or
even traditional taxi company, they will not exclusively use
Uber.
OPPORTUNITIES
Uber realized that customers are unhappy with the old-fashioned
taxi firms following unusually high costs and delays. This has
been a great source of market opportunities, as evidenced by the
firm’s expansion to nations, like Kenya and India, where cab
services are highly rated and problematic. The company has also
taken advantage of regions where there are no taxi services in
operation. Uber service is specially made for that customer who
needs affordable and convenient service, that lacks in most of
its opponents (Bashir, Yousaf & Verma, 2016).
Uber is able to calculate its prices automatically and based on
the prevailing economic circumstances. This is an opportunity

that makes it survive tough economic times. Uber has been keen
on programs that are aimed at reducing climate change and is
always committed to embracing transportation mechanisms that
cannot overcome weather challenges like planes. Uber has taken
advantage of the existing international agreements in an effort
to expand its market share (Zickuhr, 2016).
Uber is committed to continue inventing better ways of service
delivery through adopting and linking with partners to meet and
exceed customer expectations. Not only does the firm include
used cars in its operations, but also airplanes to ensure that
customer’s needs are met conveniently. Uber enjoys numerous
opportunities from cheap electric cars, offering its services to
the sick, taking pupils to school, and taking pets to the doctor.
Other opportunities include the increasing disposable money
and need for quality (Alley, 2016).
THREATS
Uber, like any successful company operating in a free market,
has to deal with competition. Lyft is Uber’s largest and most
direct competitor outside of cab companies. The effects Lyft has
on Uber are multi-faceted. These include driving down profit
margins, which not only effects Uber’s bottom line, but also
that of its drivers. The latter can lead to unhappy drivers, which
can lead to a drop in service from a reduced fleet. In fact, Lyft
is more favorable for drivers in terms of commissions and tips.
The Uber app doesn’t encourage tips, as Lyft does (Van
Maldegiam, 2015). Another major area of concern is regulation
in markets. It’s no secret that Uber has caused a large decrease
in revenue from taxi companies (Nelson, 2016). This will
motivate existing taxi companies to lobby local governments to
create regulations, and other barriers to market entry. In fact,
Germany and France have already introduced fines and put
regulation in place to ban and/or limit Uber from operating
(Davies, 2016). Intuitively one may assume that consumer
demand will trump such efforts, as it has in the United States.
However, lobbyists and governments use many tactics,
including scare tactics with regard to safety (Kerr, 2014). This

is not to minimize the importance of safety. As the brand grows,
new drivers come in as unknown variables. Any issues with
safety can lead to bad press, which will undoubtedly be used
against Uber. Changes in technology can lead to, another
company coming with a new innovative idea to grab market
share. For instance, self-driving cars are being explored by
Google, and may be a threat in the future (Google, 2016).
Lastly, overvaluation leading to overinvestment in a given area
is a concern.
References
Alley, J. K. (2016). The Impact of Uber Technologies on the
New York City Transportation Industry.
Bashir, M., Yousaf, A., & Verma, R. (2016). Disruptive
Business Model Innovation: How a Tech Firm is Changing the
Traditional Taxi Service Industry. Indian Journal of Marketing,
46(4), 49-59.
Chan, S. (2015). SWOT Analysis for Uber. Retrieved from
https://prezi.com/vg9ka4hxa1s3/swot-analysis-for-uber/.
Christensen, C.M., Raynor M.E., & McDonald, R. (2015). What
Is Disruptive Innovation? Harvard Business Review. Retrieved
fromhttps://hbr.org/2015/12/what-is-disruptive-innovation.
Damodaran, A. (2014). Uber Isn’t Worth $17 Billion.
FiveThirtyEight. Retrieved
fromhttp://fivethirtyeight.com/features/uber-isnt-worth-17-
billion/.
Davies, R. (2016). Uber suffers legal setbacks in France and
Germany. The Guardian. Retrieved
fromhttps://www.theguardian.com/technology/2016/jun/09/uber-
suffers-legal-setbacks-in-france-and-germany.
Google. (2016). Google Self-Driving Car Project. Google.
Retrieved fromhttps://www.google.com/selfdrivingcar/.
Kerr, D. (2014). How risky is your Uber ride? Maybe more than
you think. cNet. Retrieved fromhttp://www.cnet.com/news/how-
risky-is-your-uber-ride-maybe-more-than-you-think/.
Konrad, A. (2016). Uber Raises $3.5 Billion From Saudi
Sovereign Wealth Fund, Keeps $62.5 Billion Valuation. Forbes.

Retrieved
fromhttp://www.forbes.com/sites/alexkonrad/2016/06/01/uber-
raises-3-5-billion-from-saudi-sovereign-fund-at-62-5-billion-
valuation/#7abbaffa41d4.
Nelson, L.J. (2016). Uber and Lyft have devastated L.A.'s taxi
industry, city records show. Los Angeles Times. Retrieved
fromhttp://www.latimes.com/local/lanow/la-me-ln-uber-lyft-
taxis-la-20160413-story.html.
Salmon, F. (2011). Why taxi medallions cost $1 million.
Reuters. Retrieved fromhttp://blogs.reuters.com/felix-
salmon/2011/10/21/why-taxi-medallions-cost-1-million/.
Salmon, F. (2011). Why taxi medallions cost $1 million.
Reuters. Retrieved fromhttp://blogs.reuters.com/felix-
salmon/2011/10/21/why-taxi-medallions-cost-1-million/.
Somerville, H. (2016). Uber’s rivals have a new road map.
Business Insider. Retrieved
fromhttp://www.businessinsider.com/r-didis-dominance-of-
uber-in-china-offers-roadmap-for-ride-hailing-rivals-2016-8.
Van Maldegiam, S. (2015. Uber vs Lyft Shootout. The
Rideshare Guy. Retrieved fromhttp://therideshareguy.com/uber-
vs-lyft-shootout/.
Worstall, T. (2014). How Uber Increases Driver Profits While
Being Cheaper Than Traditional Taxis. The MotleyFool.
Retrieved
fromhttp://www.fool.com/investing/general/2014/01/23/how-
uber-increases-driver-profits-while-being-chea.aspx.
Zickuhr, K. M. (2016). When Uber comes to town: The impact
of transportation network companies on metropolitan labor
markets (Doctoral dissertation, GEORGETOWN
UNIVERSITY).
HOLMES INSTITUTE
FACULTY OF HIGHER EDUCATION
HA2042 ACCOUNTING INFORMATION SYSTEMS

TRIMESTER 2 / 2016
Group Assignment
3500 + words and extra for diagrams: WORTH 20%
The processes of selecting an AIS/ERP to make informed
decision for investment in an accounting softwareGroup
Assignment Scenario
B Bakery is a family owned firm with around 70 employees and
sales revenue increased to more than $ 13.5 million during the
past year. It has been in business for over 50 years and supplies
bread and confectionary products to a number of different
businesses, including supermarkets and pub-chains. The firm
has experienced mixed fortunes over the years in terms of
business performance, but in the last few years has experienced
a growth in orders for some of its new healthy product ranges.
However, the Bakery has recently lost some key accounts as a
result of being unable to produce some of its products at a
competitive price.
Although the firm hired an accountant who was keeping their
books for them and producing the financial statements each
year, the firm thought they needed much more information to
really run their business efficiently. They felt that they needed
to make an investment in an accounting software to take their
business to the next level.
Assignment RequirementsIn groups of three or four, you are
required to conduct desk research on AIS/ERP Systems for your
above client. Prepare a Business Report for the client detailing
the following processes of selecting an AIS/ERP:

1. Define business processes
a) What a Baker does? Discuss the business activities/processes
of the organisation to show your understanding about the
business. (600 words)
2. Develop business requirements
b) What processes are indispensable to be performed? (350
words)
c) What outcomes are required from these processes to achieve
business objectives? (350 words)
3. Determine the systems requirements
a) What are some of the possible software features or
functionalities that the firm should consider to achieve their IT
investment objective? (700 words)
4. Software selection
a) Visit the web sites of accounting software package vendors
(e.g. SAP, MYOB, Xero etc.). You need to visit at least 3
(three) software vendors’ websites.
b) Which category of accounting software (low, medium or
high-end/ERP) suitable for the firm? Give your justifications in
detail. (300 words)
5. Vendor selection
a) Compare and contrast the features/ functionalities of two
accounting software packages offered by accounting software
package vendors (e.g. SAP, MYOB, Xero etc.) within your
selected category in question 4. (600 words)
c) Which one would be the most suitable vendor (and
accounting software package) for the Bakery business and why?
(600 words)Format of the Report1. You at least should have the
following details:a. Assignment Cover page clearly stating your
name and student number b. A table of contents, executive
summaryc. A brief introduction or overview of what the report
is about.d. Body of the report with sections to answer the above
questions and with appropriate section headingse. Conclusionf.
List of references.2. Diagrams and tables clearly labelled and
explained.3. Ensure all materials are correctly referenced.
Plagiarism will be severely penalised.

MARKING SCHEME FOR REPORT:
Contents of the report
Excellent
8-10
Good
6-7
Average
5
Not adequate
3-4
Poor
0-21. Format of the Reporta) Assignment Cover page clearly
stating your name and student number b) A table of contents,
executive summaryc) A brief introduction or overview of what
the report is about.d) Section headingse) Conclusionf) List of
references
Comments:
/10%
2. Define business processes
a) Discuss the business activities/processes of the organisation
b) Shows understanding about the business.

Comments:
/10%
3. Develop business requirements
a) Identification and discussion of important business processes
for the business
b) Clear explanation about outcomes from these processes to
achieve business objectives
Comments:
/20%
4. Determine the systems requirements
Software features or functionalities that the firm should
consider to achieve their IT investment objective
Comments:
/20%
5. Software selection
Justifications and arguments for the selection

Comments:
/20%
6.Vendor selection
a) Compare and contrast the features/ functionalities of two
accounting software
b) Justifications for the vendor selection recommendations.
Comments:
/20%
Overall Comments
TOTAL /100%
TOTAL /20
4 | Page
HA2042 ACCOUNTING INFORMATION SYSTEMS,
TRIMESTER 2 / 2016, Group Assignment