Fedex : The Key Strategy For Success Essay

In addition to that, FedEx came up with new services such as Saturday deliveries, delivery by 10:30 A.M., customer interfaces (drop boxes, drive through stations and express delivery stores) and same day pickup of order. This is to distinguish its services. More on that, FedEx's philosophy of "People-Service-Profit" was successful in insuring a union free workforce devoted to customer focus. In 1978, deregulation in transportation helped FedEx to acquire larger planes therefore achieve lower cost. Trade deregulation in Asia-Pacific enabled FedEx to expand further. The acquisition of Gelco express, Tiger International, and establishment of Airport Hub in Brussels expanded FedEx internationally. Inflation and rising global competitiveness generated the need for "just-in-time" supply model, which was the advantage supported by FedEx advanced technologies.

By capitalizing on this strategy, FedEx was able to boost its average delivery volume in 1976 to 20,726 packages per day via its three services, Priority-One, Standard Air, and Courier Pack, compared with an average of 10,521 delivered daily the prior year. Clearly the company’s calculated use of strategically-located hubs, nighttime flight routes, and limited package size allowed the company to carve out a niche by reliably delivering packages on an immediate, overnight basis.

FedEx Corporation or Federal Express is an American global courier delivery services company which was founded in 1973 by Fred Smith. It is headquartered in Memphis, Tennessee. Today, with a fully integrated physical and virtual infrastructure, FedEx’s business model supports 2–48 hour delivery to anywhere in the world. FedEx operates one of the world’s busiest data-processing centers. It operates one of the largest real-time, online client/server networks in the world. The main core competencies of FedEx are in express transportation and in e-solutions. These competencies include a very timely customer response time, cutting-edge technology and innovation.

DHL 31%, USPS 8%, FedEx 27%, and Amazon 3%. From these numbers Amazon is a very small player in the shipping department. Every competitor, expect DHL, are currently shipping the excess freight that Amazon cannot maintain. With Amazon 's move to acquire more of the market, these competitors need to be on the lookout because portions of their market share can be taken away. These major shipping firms only provide shipping services not offering household products like Amazon. With Amazon starting by semi-supplementing their shipping avenues, Amazon has the potential to grow even larger. The market cap numbers are not a good basis to judge market share on since FedEx and UPS have the majority of the market in the shipping industry. FedEx and UPS are the major competitors against Amazon and its new shipping department. FedEx and UPS had the most recent annual net income of $50.3 billion and $58.3 billion respectively. They represent the majority of packages delivery from individuals, businesses, and online retailers.

FedEx’s new product Courier Pak makes sense because of its’ high profit margin and potential to generate new volume. Out of the 3 services that Fed Ex provides, CP yields the highest profit margin at 66% while Priority-One is at 55% and SAS is only at 27%. In addition to this, the company believes that it will be able to boost up sale of CP from 1300 to 6000 packages per day. This shows that CP is the most profitable and huge potential for growth.

Federal Express was founded in 1971. In 1973, FedEx started operations officially and its hub-spoke distribution pattern enabled it to offer cheaper and faster service than its competitors. By 1981, UPS began to enter into the overnight air market and the United States Postal Service (USPS) cut its overnight letter at half the price of FedEx’s. Despite facing such extreme competition in the industry, FedEx could still excel due to change in the business environment. The success of the firm could be attributed to several factors:

FedEx was first established in 1973 as a logistic company with the name Federal Express that be created by founder and first CEO Frederick W Smith. The Headquarters is in Memphis, Tennessee in the US. The company became well known for its fast and reliable delivery service around the world. On its first night of operation FedEx delivered 186 bundles to 25 urban locations in the US with only 389 employees and a 15 Dassault Falcon aircraft. In 1980 FedEx purchased a system for live updates on the packages. In this system, FedEx drivers share the current locations from the trucks to provide updates of the packages to the customers. This information was sent to a central computer of FedEx then the company improved the update system by introducing FedEx.com webpage. This webpage allowed the tracking data to be easily accessible. However, recently, FedEx uses Savvy bundle for packing and tracking the products across couriers. (Baldwin, 2016)

FedEx has reached this frontier through a combination of the four building blocks of competitive advantage. According to Morris (2009), FedEx is not just noted for its revolutionary idea of overnight delivery, or for its innovation through technology, or for its reputation as a reliable, courteous, and service-oriented alternative to the postal service, but for the mixture of all these elements fused together into a successful business model. Reliability and innovation have played a major part in FedEx’s success and value creation. If it is going to continue to maintain a

FedEx is the brain child of its current Chairman, President, and CEO, Fred Smith. Smith developed the concept in a term paper he wrote as an undergrad, in which he determined that the current logistical systems of the 1960’s wasn’t meeting the needs of urgent shippers. Instead, Smith proposed a process whereby time-sensitive products would be transported in a way that didn’t rely on passenger routing. Smith began to make this dream a reality, a few years later when he purchased controlling interest in a small aviation firm (About FedEx, 2016).

The main station is located in Memphis, Tennessee in the United States. The company started off by delivering couriers to some American cities, which was the first time for parcel delivery to take place at that time. As stated before, the industry’s goal is to fulfill the needs of customers, developing relations with different companies, and ensure a high investment for its shareholders. This is made possible through their six shared principles: people, service, innovation, integrity, responsibility and loyalty (FedEx). In order to satisfy its clients, FedEx has3 branches which provide customers with different services regulated on different demands; this include FedEx Corporation, FedEx Express, FedEx Kinko’s, FedEx Ground, FedEx Freight, and FedEx Services. It delivers more than 10.5 million shipments daily, covering more than 220 countries. Monthly, it has over 50 million visitors. In order to… it has 1250 express stations, 33 ground hubs, 370 freight service centers, and more than 1800 offices. The company also possessed 656 aircrafts and more than 100,000 motorized vehicles for express, ground, freight and expedited delivery service (FedEx). Through these aspects and values, Smith achieves to develop a company with a productive way in controlling time, space, and

FedEx is one of the largest global shipping and solutions corporations in the World. FedEx has more than 300,000 employees all of which whom provide services to consumers along with businesses globally. FedEx is broken down into several kinds of operating systems, which include FedEx Freight, FedEx Express and FedEx Ground. All of which serve different purposes on how they are able to deliver products to its consumers. The headquarters of FedEx is located in Memphis, Tennessee. The location of the headquarters was quite strategic as Memphis is considered a central point within the United States. Since most of the shipping is through use of a plane they are only a couple of miles away from Memphis International Airport, which is almost

Today FedEx Corporation is the premier provider of shipping and information services worldwide. Headquartered in Memphis, Tennessee, the company functions under the motto "operate independently, compete collectively and manage collaboratively."(FedEx.com, 2011)

FedEx provides logistics, transportation, and related business services through focused operating companies, also known as business units (FedEx, 2016). Further, FedEx provides a broad portfolio of transportation, e-commerce and business services through companies competing collectively, operating independently and managed collaboratively, under the respected FedEx brand (Parnell, 2014). Notably, it operates in four distinct business units: FedEx Express, FedEx Ground, FedEx Freight and FedEx Services (SEC, 2015). Uniquely, each unit operates independently and provides the following services:

FedEx is a leading provider of supply chain management to corporate customers on a global perspective. FedEx is made up of six independent business units; FedEx Express, FedEx Ground, FedEx Freight, FedEx Custom Critical, FedEx Trade Networks and FedEx Services which all complete each in the different sectors of the transportation industry so that they can tailor FedEx services as a whole to fit its customers' needs in the best way possible. It boasts of a fleet of aircraft and may motor vehicles and trailers. As a means of complementing its express delivery business, FedEx ground has provision for small packages ground delivery, less-than-truckload (LTL) carrier FedEx freight hauls larger shipment. There are various strategies that FedEx uses in its business operations, this paper will therefore give a highlight on the strategies that FedEx applies when it comes to its distribution that ensures its success in distribution. It will look at why FedEx has control of most of the distribution channels for their services (FedEx, 2012).

Organizational structure and cultural in FedEx, as stated in the book “The key component in internal environments is organizational culture, or the set of key values, beliefs, and attitudes shared by members of the organization” (Williams, 2013 pg. 60). As stated by Frederick W. Smith Chairman, President and Chief Executive Office “FedEx name is synonymous with integrity and reliability our reputation is an important strategic asset”. FedEx has a reputation for providing fast friendly customer service and satisfaction. “Lawful and ethical behavior is critical to our continued success and it is required, you must comply with those laws and regulations relating to your business conduct” (According to FedEx code of business conduct and ethics 2013, pg. 5).