FedEx Case Analysis
FedEx generates its revenues from e-commerce, transportation, and business service. These can be classified under three categories, FedEx Ground, FedEx Express, and FedEx Freight. The company is principally involved with delivering packages across the world. Therefore, the company has clients in all parts of the world where commodities and documents need to be delivered. It is the second largest package delivery company in the world (Bowen, 2012).
The company has a global presence and reach. The company has a huge market since it serves all the people across the world who need their commodities or packages delivered. It has a global network of air and ground systems that offer package delivery and freight services.
The company has an outstanding name that is known across the globe. The brand image that the company has built over the years has provided some great benefits such an attracting new customers.
The company also provides different services that help it to leverage losses incurred in one business. It charges low prices for these services making it a first choice for many customers (Wong &Karia, 2010).
Weaknesses-FedEx Case Analysis
There is minimal differentiation in terms of the products that the company provides. The level of competition is high but all the companies provided almost identical services.
The services offered are also cyclical in nature. For instance, the peak season is usually in November and December and during holidays.
The company also has high operating costs, which grow each year. These costs eat into the profits generated by the company. These costs have been high during pandemic when many services were brought to a halt.
FedEx can partner with other companies that offer innovative solutions to transport and logistics challenges across the world.
FedEx can also use digital technology and artificial intelligence in its model of business. This will crew better customer experience and set it different from competitors.
The company can also engage in diversification. Diversification will also cushion the company against unexpected losses (Wong &Karia, 2010).
Regulations are one threat that faces FedEx. Across the globe especially after COVID-19 outbreak, governments have put in place strict measures concerning packages and commodities entering a country. This has resulted to an increase in operating costs.
The threat of new competition has also become a reality. Even though FedEx remains the second largest company in the industry, this might not be the case in future if competition keeps on coming into the market.
Specific-FedEx Case Analysis
FedEx is intensifying competition through value creation. The company is trying to keep a step ahead of its competitors by creating value for the customers. Since majority of the companies if commodities and documents delivery industry offer same services, FedEx strives to show customers get value for their money. It creates value by ensuring that the consumers or customers see an economic value in working with FedEx.
Another corporate strategy is geared towards company growth. Even though FedEx is the second largest firm after UPS, it keeps on investing in its growth. There is no one wants to be number two and in this case, FedEx aims to be the market share leader in its industry.
The company also is expanding in new markets in the world. The world is becoming smaller and smaller giving companies such as FedEx an opportunity to grow and serve new markets. Today, FedEx is starting to become a household name in Asia and in Africa where there markets remain hugely untapped. Expansion onto the new markets will also help the other strategy of grow of the firm. Expansion into new markets will bring new cash flows and help the company grow and increase its market share.
FedEx wants to lead from the front in transforming the industry conditions. It wants to make the industry the best to work in and attract new talents to the commodities and documents delivery industry. This could also involve trying to make people send packages all the year round instead of during the peak season alone.
Corporate Ethics-FedEx Case Analysis
FedEx operates in line with international law. The company carries its businesses with respect to international laws as well as individual countries laws. It has to comply with government policies not only in Canada and USA but also in other nations.
FedEx bas also to strictly follow labor laws, which govern how workers are paid and how many units they can work. Following labor laws saves the company from being involved in multiple cases and loss of money through litigation fees and fines imposed on the company (Bowonder et.al, 2010).
Corporate Culture and Leadership
The company is committed to having employee satisfaction. Worming for FedEx should help employees feel appreciated and motivated to wake up and report to work each day. To motivate employees, the company offers competitive wages and is fair in its hiring process (Qing et.al., 2020).
The company is committed to respecting government policies as well as labor laws. FedEx follows all the labor laws and government policies, which are put into place as a regulatory mechanism. Moreover, the company is also committed to investing in technology and new ways of delivery packages to its customers (Qing et.al., 2020).
At FedEx, team work is very important. Before a package reaches its customer, it has to go through different people both in the warehouses and outside. In the warehouse, team working needed when sorting out different packages. Working as a team saves time and also ensures that packages reach their destinations in time.
Recommendations-FedEx Case Analysis
FedEx should invest in people through training. Hiring qualified people to oversee different operations is not enough; the company has to regularly train them. Training can be a costly investment but it is worth every cent. Training equips workers with new knowledge and expertise of doing their businesses. FedEx should also invest in capital in terms of equipment and other delivery facilities. Investing in equipment will go hand in hand with training that the employees of the company receive. Finally, FedEx should seek advertise more and reduce its charges. This will bring in more customers and attract those customers who use its competitors’ services.
Wong, C. Y., & Karia, N. (2010). Explaining the competitive advantage of logistics service providers: A resource-based view approach. International Journal of Production Economics, 128(1), 51-67.
Bowonder, B., Dambal, A., Kumar, S., & Shirodkar, A. (2010). Innovation strategies for creating competitive advantage. Research-technology management, 53(3), 19-32.
Bowen Jr, J. T. (2012). A spatial analysis of FedEx and UPS: hubs, spokes, and network structure. Journal of Transport Geography, 24, 419-431.
Qing, K. J., Kee, D. M. H., Soon, J. C. T., Hui, C. K., Singh, A., Kurniawan, O. E., … & Sin, L. G. (2020). The impact of employee satisfaction, organizational commitment, job performance and teamwork as the success factors in FedEx: A study of FedEx’s employees in Malaysia. International journal of Tourism and hospitality in Asia Pasific, 3(2), 48-56.