XPO Logistics SWOT & PESTLE Analysis

Strength

1. Largest service provider of last mile delivery and logistics in North America: With rapid growth in e-commerce, demand for logistics and transport for last mile delivery is also rising rapidly. Unlike freight services, which facilitate mass transportation of cargo, last mile delivery services include transport of shipment in small quantities from small e-commerce retailers and warehouses of large online e-commerce platforms to buyers. XPO logistics has expertise in this area to serve its customers with over 85 last mile delivery hubs in North America, which can serve 90% of the regions population smoothly. Through its own assets and network of independent contractors, XPO serves its customer in North America and Europe. With a large fleet of over 100000 trucks, combining both independent carriers, 50000 independent brokered careers, XPO Logistics turns to be the largest service provider of last mile delivery transportation in North America.

2. One of the largest contract-based logistics facilitators, freight brokerage provider and transportation across the globe: XPO Logistics is the second largest service provider of contract based warehousing space and e-fulfillment facilitator. It uses its scalable proficiency in delivery management, reverse logistics and transportation to provide maximum convenience to its consumers. In 2019, the company had over 19 million sq. m. of space for warehousing facilities. With warehousing, freight and transportation are also the key areas of expertise of XPO. It has its own large fleet in North America and has a large network of independent contractors to avail transportation. It enables XPO to avail services across oceans and door to door too. The company is the top five global service provider of managed transportation. The company has the capacity to provide expedite services to 99% of US zip codes, expanding its wings to the rest of North America. Being licensed by the U.S. Customs and Border Protection Service, XPO provides direct brokerage service to custom importers, vessel operators and competitors too. Through its own large fleet of vehicles and outsourced services from owner-operators of vehicles XPO Logistics serves with end to end logistics services to consumers in various sectors like e-commerce, food and beverage, technology, aerospace, wireless, manufacturing and other industrial, chemical, agribusiness, life sciences and healthcare.

Weakness

Opportunity

Threats

Political

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Economic

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Social

1. The driving force of seasonal demands in last mile delivery business: Every year, fourth quarter involves holidays and festivals in Europe and North America. People tend to shop more during this time. Consumption usually rises during this time. XPO Logistics has mentioned in its Annual report of 2019, that due to its strong position in the e-commerce segment, with rising demand in the fourth quarter, its earnings during the same quarter substantially increases. People also tend to do urgent shopping during the same period, so profitability increase with surge in demand of expedite and premium shipping services. On a contrary, earnings drop in the first quarter due to reduced demand from the e-commerce segment. Hence, the logistics business goes through a trend of highest demand of its services in fourth quarter and low demand in first quarter due to higher consumption during holidays.

Technological

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Legal

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Environmental

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