Airborne express case study

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Airborne Express, an air express transportation company has succeeded to compete with a few big competitors such as Federal Express and United Parcel Service (UPS) even it does not have funding as much as its competitors. In 1996, it held third position in the industry with 9 percent of the market. Even Airborne is smaller size company compared to its main competitors, it still can survive with the competitive advantage through its resources and capabilities. With some unique resources and core competences, a company may have competitive advantage over its competitors, and this is the way small capital company able to compete with its competitors.

Airborne Express is the first and only air express transportation company that owns an
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By matching the needs of the groups, the company will have a better chance to win the customers than its competitors.

Another aspects that Airborne get competitive advantage is the creation of the only privately certified Foreign Trade Zone (FTZ) in United States at its Wilmington hub. In a FTZ, merchandise is tax-free and no customs duty is paid until it leaves. It is a big attraction to the foreign companies. The companies can keep their inventories in Wilmington hub, and the inventories will be delivered to the destination by Airborne when needed. The local companies that implement Just-In-Time policy will prefer the service very much. It is because the inventories cost will bear by the suppliers that keep inventories in Airborne hub. For foreign companies, not only can satisfy the needs of local customers, but also can save the cost of tax and duty paid. The FTZ is a good factor that will help Airborne to set foot into the international market. However, because of the capital constraint, Airborne still unable to compete with Federal Express and UPS in the international market.

Normally, large sizes A-containers are used in the air cargo business. Around $1million per plane is required to install cargo doors to take A-containers. To solve the problem, Airborne has developed C-containers that are six times smaller, and can fit through the passenger doors
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