Marketing Plan Foundation: FedEx
Many people know that Federal Express (FedEx) is a global courier and package delivery company. According to their site information, “FedEx Corporation provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services.”(About FedEx, 2012) This indicates they provide a much broader range of services than just delivering packages. FedEx has grown into a worldwide provider of many different forms of transportation and business services.
Brand Name
Because of their many partnerships and product lines FedEx has created the “Signature Elements” in addition to their base brand name. They keep the FedEx portion of the brand name the same size and font with the exception of the color of the “Ex” portion. The “Signature Element” is placed below and in a smaller font (See Figure 1).
Product Line
With the growth of online shopping involving mainly Amazon and eBay, those businesses are in need of carries to supply the product. One of those carriers is FedEx and they supply a product line for all package handling. Often with online shopping the product is either too far away for the customer to pick it up, this is where FedEx Express comes in. FedEx Express was the original brand name and included and air line package handling system. While that lasted for a while the owner Fred Smith decided to shake things up a bit. While leading shipping service UPS had already had the idea, Fred expanded the air line and brought in trucks to run the packages on the ground with fast retrieval. With the already wide ranged expansion in the U.S. FedEx has went international the plan is to add 88 branches nationwide in Brazil and claims to have a network of 2,400 vehicl...
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...e. The express package and freight market is highly competitive, which could affect the growth of the company. Key competitors of the company include United Parcel Service, Inc, U.S. Postal Service, DHL International Limited, Con-Way Inc., Geodis SA, and TNT NV, among others (GlobalData, 2014).
Increasing fuel prices. An ongoing and future threat is the rising prices of fuel. Fuel prices and supply levels can be influenced significantly by international, political and economic circumstances. The greatest single factor influencing fuel prices is the cost of crude oil. The higher fuel prices could adversely impact the group’s operating results (DataMonitor, 2011). Crude oil supplies may depend on general political conditions, any occurrence of wars or terror strikes, instability in the Middle East and South America and the strength of U.S. dollar (GlobalData, 2014).
John Deere & Company manufactures and distributes agriculture equipment as well as a broad range of construction and forestry equipment. The company is partnered with FedEx in order to maintain the logistics flow involved with the company’s transactions. FedEx is responsible for providing outsourced transportation services to 11 Deere facilities across the US and Canada. The 11 Deere facilities have different service agreements with FedEx in terms of cost and service depending on the type of business unit.
In 2003 in an unprecedented move, UPS teamed up with rival FedEx to keep DHL from entering the US parcel market. DHL had purchased Airborne Express in an attempt to enter the US market. UPS and FedEx identified that DHL would distort US competition because DHL could subsidize its competitive activities with revenues gained from its postal monopoly in Germany. Unable to compete against the two US shipping giants, DHL announced in 2013, it would close its North American operations. In May 2013 DHL started outsourcing some of its operations to UPS.
The decision to open in Louisville was no mistake: the city of Louisville, Kentucky, serves as a major transportation hub for supplies and center for logistical support throughout the United States. Possessing an international airport with customs access allows UPS to be centrally located in t...
The North American transport system is run by several different agencies, each one having its own important part in making it all run smoothly and efficiently . There are also several policies that have been put in place to keep the transportation system working for the good of everyone. The agencies involved keep very good records of all the types of transportation that make up the system, which makes it easy for anyone to be able to see all the different statistics associated with the system. The Freight broker business is another important part of the transportation system, the following paragraphs will tell how all these things work together.
UPS is performing better than FedEx in financial performances. From 1997-1999, UPS reported average net profit margins of 6.5% while FedEx¡¦s was 2.8% and ROE of 25.2% for UPS and 10.6% for FedEx. Although UPS¡¦s net income in 1999 dropped significantly, it was result of a tax dispute, which should not affect the sustainability of the UPS financial performance. One of the factors driving this performance is the growth in the international delivery business. International operations in 1999 has accounted for 13% of the UPS¡¦s revenues and 5% of the operating profits. International package revenue grew 50% since 1994 and international...
In 2004, crude oil producers around the world expected a 1.5% growth in the world’s demand for crude oil. The actual growth rate was more than double the projections at 3.3%. This growth was due to rapidly industrializing of foreign countries such as, China and India. Therefore the lack of crude oil affected the supply of gasoline to consumers at the pump.
Fuel prices is an area of concern for the motor carrier industry. Fuel prices are at an all-time high, driving the industry to make drastic changes. Individuals in the industry believe that by reducing the demand for fuel is the best way to address the current fuel issue. One of the leading alternatives to this fuel issue could be natural gas.
The first post office in the United States was established in seventeen seventy-five, which makes it the oldest most reliable post service in history. It is a well know fact that in the beginning, this business was called the Pony Express, which began in eighteen sixty. Years later the US Post office has become the largest company that we rely on to deliver our mail. This mailing institution delivers more mail to a larger area than any other delivery service in the world. They are rendering assistance to more than one million people in North America. There are over six hundred thousand employees and in excess of thirty four thousand facilities nationwide. This institution thrives to provide customer service, available products, transport of products, and accessibility to all consumers. The United States Postal Service is a reliable, excellent, and efficient delivery service. They supply a wide variety of convenient products to help with any shipping needs consumers may have.
IT management also prepared UPS for BCP-DR to avoid downtime. UPS’s IT infrastructure allowed customisations to incorporate unique functional requirements of customers. UPS also reduced its application development time by reducing rework. It created reusable modular applications. UPS has been very receptive towards the opportunities created by the IT to boost its core business. Even after this UPS was not able to keep up its pace with every valuable system development request. By 2000, UPS had a major share in domestic integrated package delivery services, but had an insignificant share in international, though the international market was growing at a double-digit rate. Therefore, the UPS management decided to allocate IT resources to the most strategic opportunities and preserve as appropriate via infrastructure
Founded in 1907 as a messenger company, United Parcel Service has grown into a world renowned provider of specialized transportation and logistics services. This multi-billion corporation enables and manages the flow of goods, information, and funds to over 200 countries and territories around the globe (UPS.com, 2013). Air, freight, oceanic is just a few of the modes that UPS uses to move the flow of goods around the globe. The company structure of UPS entails operations in three segments: U.S. Domestic Package operations, International Package operations, and Supply Chain & Freight operations. It’s just about an everyday occurrence to see an brown UPS truck on the road as we go about our everyday lives, the U.S. Domestic Package operations are comprised of delivery of documents, packages, and letters around the United States. The International Package operation delivers specifically outside the United States. Providing deliveries to the world’s major business hubs up to three times a day, UPS can deliver packages to at the best time possible for their customers. UPS has teamed up with the U.S. Commercial Service, an agency of the U.S. Department of Commerce, to help customers get started exporting or increase their sales to new global markets (UPS.com, 2013). Partnering within a supply chain can prove to be very important in the success of the overall supply chain. Communication within a supply chain that flows freely between partners reduces in-efficiencies such as excess inventory (bullwhip effect), and lost profits. The Supply Chain & Freight operation within UPS entails forwarding and contract logistics operations and UPS Freight. As a freight forwarder they organize shipments from various sources to their final p...
Business depends very critically upon Fed Ex. If Fed Ex had a major disruption to their delivery system, flowers would not be delivered on time, resulting in dissatisfied customers. For example, if Fed Ex employees went on strike, there would be no alternative equivalent to Fed Ex to deliver flowers to customers. UPS, although an alternative, did not deliver perishable products in the same timely fashion as Fed Ex.
Bargaining Power of Suppliers: The suppliers who provide the boxes and envelopes most likely sale the products in bulk, this is economies of scale and allows UPS to sale them at a cheaper price.
This rating as well as many others factors have lead to the success of the United Parcel Service. The current status of the company reflects the strength of the their competitive position. The leaders of the current which include James Kelly, Michael L. Eskew, and John A. Duffy have set an example for anyone who is interested in management as a career. Their tactical maneuvers are first rate. This company succeeded because of the drastic communication advances. The customer is ultimately satisfied with the reliability of UPS to deliver on time. This is the marketing factor that sets UPS a step above the competition All decisions were made in the respect that the company would continue to bring the customer more than they expected. In turn United Parcel Service is an extremely profitable corporation. The environment provided by UPS keeps customers, employees, and managers working hard to keep up the high standards set by todays’ customers.
FedEx started offering SCM services to its customers on a very small scale in 1974.With increasing demand for services such as in...
FedEx has annual revenues of $20 billion and is the leading global provider of transportation, e-commerce and supply chain management services. FedEx accounts for a large market around the world. It is a fact that FedEx reported an average daily express package volume of 3,167,000 for the fiscal year ended May 2004, with U.S. volume of 2,771,000. Of those U.S. shipments, 1,846,000 (66.6%) were overnight shipments, and 667,000 (24.1%) were overnight letters. Total international daily package volume was 396,000, just 12.5% of all shipments, and FedEx does not break out overnight shipments (www.yahoo.com) (Appendix A)