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FedEx SWOT & PESTLE Analysis

ID : 52182553| Sep 2020| 15 pages

COMPANY PROFILE -FedEx

Business Sector :Logistics

Operating Geography :United States, Global

About FedEx :

FedEx is an integrated transportation service provider. It is one of the largest express transportation company delivering small package worldwide. It provides integrated services under three vertical – FedEx Express, Ground and Freight. FedEx Express is one of the largest transit companies across the globe to provide agile, secure, and time-definite delivery to more than 220 countries and territories as of 2019. From tiny packages to heavyweight parcels, from less critical to express deliveries, from import to export of goods FedEx offers a broad portfolio of transportation services, accommodating the changing needs of patrons. FedEx is headquartered in Memphis, Tennessee. As of 2019, FedEx has roughly 239,000 employees, 103,000 drop-off locations, 681 aircraft, and nearly 91,000 vehicles in its global network.
FedEx’s mission and vision as per the company website states is “FedEx Corporation will produce superior financial returns for its shareowners by providing high value-added logistics, transportation and related business services through focused operating companies. Customer requirements will be met in the highest quality manner appropriate to each market segment served. FedEx will strive to develop mutually rewarding relationships with its team members, partners and suppliers. Safety will be the first consideration in all operations. Corporate activities will be conducted to the highest ethical and professional standards.”
FedEx’s Unique Selling Proposition or USP sprawls in being one of the world's largest express transportation company. The company is also well known for its unique overnight shipping service and has been a pioneer in developing a package tracking system that could render real-time updates on package location.

FedEx Revenue :


US $ 69,693 Million- FY ending 31st May 2019 (y-o-y growth of +6%)
US $ 65,450 Million- FY ending 31st May 2018

Ownership / Major shareholders :

The major holding is by institutions. The top institutional holders with their holding shares as of 31st March 2018, are mentioned below:
1) Vanguard Group INC – 7.13%
2) Primecap Management Company – 5.69% Dodge & Cox – 3.90% as on 03.31.2018
3) State Street Corp – 3.64%
4) BlackRock Inc. – 3.13%

Competitive Analysis of FedEx

SWOT
PESTLE
FedEx proffers an extensive range of U.S. domestic and foreign transit services for the shipment of packages and freight. From the past 45 years, FedEx has been and will continue to be a global leader in the transportation and information industry. The company invented the express distribution for overnight shipping of parcels with a real-time package tracking system. The money-back guarantee on all FedEx Express services is a striking business strategy that helps them procure customer trust and build a strong customer relationship. Thus, the SWOT analysis of FedEx manifests a discussion on the assets that generate surplus cash and are the greatest strengths, that the company relishes as a competitive advantage over its rival(s) in the transportation and information industry. The analysis highlights the opportunities in the external environment that can be consolidated to further strengthen the company. The SWOT report also confers intelligence on the internal weaknesses and external threats that the company confronts being in such a highly competitive environment.
It entails exceptional skills to become one of the world's largest logistics company, from a vast distribution network to innumerable warehouses and stores, from competitive rates to high margins, FedEx has it all. Besides, FedEx also has strong brand equity and market position, the capability to provide overnight shipping, the best technology in hand, on-time deliveries, over 45 years of experience in logistics services, renowned acquisitions and mergers, diversified business operations, and a broad portfolio of services. Despite all its impeccable strengths certain internal factors like high dependency on the US market for major revenue, carrier damages, limited scope for differentiation in services, etc. turn out to be the internal weakness of the company affecting the brand and its operation. Further, due to saturation in the industry, FedEx faces huge competition threats from international and local companies providing almost the same array of services. Thus, the logistic industry is witnessing huge competition, an aggressive battle for market share and price wars among its players. However, FedEx can overcome its weaknesses and threats by encompassing opportunities in its external environment. Some of the important opportunities in the transportation industry are an immense demand for parcel industry due to exponential growth of E-commerce, technology like Blockchain and AI will transform shipping, Asian economies like China and India have huge scope for brands like FedEx, etc.
The SWOT analysis for FedEx is presented below in a matrix followed by detailed analysis:
Strengths
Weaknesses
1. Strong diversity in customer base
2. High degree of cross-selling of existing services
3. Optimal logistic efficiency of the network
1. Model of Operation: Employment of contractual workforce
2. Overdependence on US market
Opportunities
Threats
1. Positive outlook for air freight sector
2. Penetration into new geographies
3. Globalisation of US companies
1. Price and availability of fuel
2. Intense competition in the economy
3. Change in Labour laws in operating states
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Detailed SWOT Analysis of FedEx

Strength

1. Strong diversity in customer base:The customer base of FedEx is vast and diverse by design. No single customer contributes more than 3% to the total revenue. This reduces the bargaining power of customers and prevents high potential loss to FedEx due to the migration of any customer.

2. High degree of cross-selling of existing services: 96% of U.S. revenue is generated by customers using two or more of the services out of FedEx Express, FedEx Ground, and FedEx Freight. About 77% of the US revenue comes from customers using all the three transportation companies.

3. Optimal Logistic Efficiency of the network: FedEx has invested a lot on automating its facilities enabling it to process growing volumes of packages. It has replaced its every aircraft with new Boeing 767-300 Freighters which are more fuel efficient and require less maintenance. Also, Network enhancements have accelerated service by at least one day in U.S. Recent acquisitions like TNT, GENCO have further expanded their global portfolio of solutions.

Weakness

This section is available only in the 'Complete Report' on purchase.

Opportunity

This section is available only in the 'Complete Report' on purchase.

Threat

This section is available only in the 'Complete Report' on purchase.

Major Competitors :

  • United Parcel Service
  • Deutsche Post AG
  • JB Hunt Transport Services Inc.
  • XPO Logistics
  • C.H. Robinson Worldwide
  • Landstar Systems Inc.

Major Brands :

  • FedEx Services
  • FedEx Office
  • FedEx Express
  • FedEx Trade Networks
  • FedEx Ground
  • FedEx Supply Chain
  • FedEx Frieght
  • FedEx Custom Critical

Key Business Segments / Diversification :

FedEx
Integrated Shipping & Logistics Couriers and Express Delivery Services

Recent Acquisition / Mergers / Alliance / Joint Ventures / Divestitures :

Open Table Preview
Name
Business Segment
Year
Type
Objective/Synergy Achieved
P2P Mailing LimitedE-Commerce Transportation solutions2018Acquisition Extend product offering in a fast growing market segment while expanding our industrial footprint in North America.
Northwest Research Inc.Inventory research and Management2017AcquisitionAcquisition of Northwest Research helped Fedex in expanding their global logistics portfolio.
Source: Company website and other reliable sources. The detailed table is available in the Complete Report.
SWOT & PESTLE (combined)
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Check Out Analysis of Other Relevant Companies

WHY BUY THIS REPORT?
TABLE OF CONTENTS
DELIVERY AND FORMAT
WHY CHOOSE US?

1. The SWOT and PESTLE analysis report offers a quick glimpse into the internal and external factors concisely in a matrix format, followed by a detailed analysis
2. The SWOT analysis of FedEx highlights the company's prevalent internal Strengths and Weaknesses, external Opportunities and Threats.
3. The Report covers compelling initiatives that were taken by FedEx, to stay ahead of its competitors and adversaries and attain a competitive advantage
4. The PESTLE/ PESTEL/ STEEPL Analysis for in-depth analysis of all external factors namely, political, economic, social, technological, legal and environmental and highlighting their impact on the logistics industry and specifically on FedEx
5. Provides holistic information about FedEx’s mergers and acquisitions, strategic partnerships and alliances, capital raising, market value, market segmentation, and equity transactions, consented with deal valuations and the synergies that were achieved with them.
6. Penetrates into FedEx’s business diversification, studies its key business segments and elaborates upon its business case study
7. Cognizance of current trends of the transportation and logistics industry and its influences on the FedEx company
8. A comprehensive company analysis of FedEx to gain knowledge about company information, company profile, business model, business plans and marketing strategy
9. Evaluation of FedEx’s USP or unique selling proposition, mission statement, and vision statement
10. Synopsis of FedEx's business model, business case study along with a peek into the company’s key performance indicators, value proposition, and success factors.
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FedEx SWOT & PESTLE Analysis - SWOT & PESTLE.COM

SWOT & PESTLE.com (2020). FedEx SWOT & PESTLE Analysis - SWOT & PESTLE.com. [online] Available at: https://www.swotandpestle.com/fedex/ [Accessed 05 Dec, 2020].

In-text: (SWOT & PESTLE.com, 2020)

Copyrights and Disclaimer

FedEx SWOT analysis has been conducted by Roshan Bhatt and reviewed by senior analysts from Barakaat Consulting.

Copyright of FedEx SWOT and PESTLE Analysis is the property of Barakaat Consulting. Please refer to the Terms and Conditions and Disclaimer for usage guidelines.

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FedEx SWOT & PESTLE Analysis
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