Fedex Economic Analysis : Financial Analysis Of Fedex

By the end of 2003, FedEx had nearly $15.4bn in assets and net income of $830million. The company has 50000 ground vehicles, 625 aircraft, 216500 full and part time employees, and shipped more than 5.4 million packages daily

During the 1980s, the air express industry was a medium to attractive industry to already be a major player in, but not a very attractive industry to try and break into. The industry can be characterized by high rivalry from competitors who compete on the same services with very little differentiation, medium power from suppliers who supply the resources necessary to run the business, high buyer power because customers can basically find an equal service from any firm in the industry, low substitution threat from other means of shipping transportation, and low threat of new entrants due to the high initial capital outlay and need of management

FedEx’s external environment both positively and negatively affects the organizations operations. Their external environment consists of government, weather, and the economy. FedEx does not have a very large external environment because their operations are not affect by many outside sources.

As young adults, teenagers are used to being the bud of the joke when it comes to technology and how soft it has made the younger generations. Almost everyone has heard the classic line, “Back in my day, we had to actually write letters when we wanted to talk to someone far away.” In an ever changing world, most children have never written a letter to a friend or family member thanks to the internet, and they probably never will. While such a fact has become accepted, it’s a harder pill to swallow for the USPS since the organization’s revenue is dependent on mail. In order to make money in a world where there is a rising dependence on technology, the USPS will have to start restructuring their business, and there are many ways to do just that.

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.

Federal Express established itself as a key player in the competitive airfreight industry, just three years after beginning operations, as a direct result of its unique strategic hub system and a policy of limiting package size to under 70 pounds.

Federal Express is known as FedEx. It is an express transportation company which was founded by Fredrick Wallace Smith in the early 70’s.

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 is a logistical service company specialized in transportation, e-commerce and business services. The success of FedEx lies on an efficient information system. The business process is as follows:

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)

Logistics services in the supply chain can be considered as a service offering, with numerous logistics companies competing to offer comparable services to many of the same consumers. As consumers hunt for potential providers in this extremely competitive marketplace, logistics service suppliers should discover approaches to distinguish themselves and their service offerings so as to help them compete. One established method for companies to differentiate themselves is by building strong brands. For instance, FedEx has evidently distinguished itself through successful brand management. The brand value to consumers is usually signify as consumer-based equity which happens when consumers possess a high level of familiarity and awareness with the brand and retains some strong, constructive and inimitable brand associations in memory (Davis, 2003). Brand awareness is referred as the consumers’ capability to recognize diverse brand elements – brand

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

Life Cycle Cost (LCC) is the total lifespan cost incurred by an organization in purchasing, installing, operating, maintaining, and disposing off any equipment used in daily operations of the firm. In regard to this, estimation of LCC encompasses using a particular approach in identifying and quantifying components of an LCC equation (Pehnt, 2006). The use of LCC as an assessment tool when selecting possible design alternatives results in the provision of a cost-effective solution within limits of available data. In addition, a standard LCC comprises initial and operation costs, installation and commissioning costs, energy costs as well as disposal costs among others.

FedEx was established on June 18, 1971, founded by Fredrick W. Smith, in Little Rock, AR. FedEx is a well known American corporation that brings courier global delivery service to its customers. Having such a wide range of portfolios, FedEx has been able to incorporate many different delivery systems for maximum customer satisfactory, with the help of e-commerce, and global delivery service it is no surprise that FedEx has consecutively been ranked amongst the most admired and trusted employers.

With the air cargo deregulations in 1977, the company was able to use larger aircrafts like Boeing 727s to further improve their operational efficiency and performance, leading to rapid growth of the company. By 1980, it had established its position in the industry and had a growth rate of 40% and became the first company to reach the USD 1 billion revenue-mark within 10 years of inception. Following international acquisitions in 1984, Federal Express started its operations in Europe & Asia. In 1994, Federal Express official adopted ‘FedEx’ as its primary brand and became a symbol of overnight parcel delivery services.