COMPANY PROFILE -XPO Logistics
Business Sector :Logistics and Transport
Operating Geography :United States, North America, Global
About XPO Logistics :
XPO Logistics is an American multinational contract logistics and transportation company. The company operates in 30 countries and manages supply chains for 50,000 customers with addition of 69 of the Fortune 100. The XPO Logistics is headquartered in Greenwich, United States. The company leverages the talent of 100,000 employees working around the world. In 2011 Bradley Jacobs, an American businessman obtained Express-1 Expedited Solution, Inc. and became it’s chairman and CEO. Later the company started acquiring other companies in the transportation and logistics sector and changed its name to XPO Logistics – a reference to Express-1’s AMEX ticker symbol. The company runs in two segments: transportation and contract logistics. Transportation segment includes freight brokerage which joins independent road carriers with companies that need to transfer materials, parts, or finished goods. The company combines railroad and truck transportation. It organizes the home delivery of heavy goods in different countries and continents. Contract logistics services includes E-commerce, warehousing and distribution, management of returned goods, cold chain and supply optimization. The company has sealed a slew of acquisitions to make foray into a variety of sectors such as technology, retail/e-commerce and aerospace. The 2020 awards have recognized XPO as a top-tier provider of multi-regional less-than- truckload service, value added warehousing and distribution, transportation management solutions.
XPO Logistics’ unique selling proposition lies in it being the second largest third-party contract logistics provider globally. The company’s mission statement reads, “People, technology, assets and expertise that work together around the globe to help our customers succeed.”
XPO Logistics Revenue :
US $16,648 billion - FY ending 31st March 2019 (Y-O-Y growth of (negative) -3.65%)
US $17,279 billion - FY ending 31st December 2018
Competitive Analysis of XPO Logistics
The SWOT analysis of XPO Logistics is presented below in a matrix followed by the detailed analysis report:
| Strengths | Weaknesses |
1. Largest service provider of last mile delivery and logistics in North America
2. One of the largest contract-based logistics facilitators, freight brokerage provider and transportation across the globe
3. A reputed reverse logistics facilitator
4. Strong presence as e-fulfillment facilitator in e-commerce sector in North America and Europe
5. Disruptive usage of technology in modernizing supply chain
| 1. Allegations of exploitation of workforce
2. Poor track record in adherence to safety protocols
3. Desire to divest acquired businesses reflects poor analysis
4. Depreciating financials of the company
|
| Opportunities | Threats |
1. Demand in the delivery of groceries in E-commerce
2. Demand of supply chain facilitators in healthcare and pharma sectors
3. Scope of driverless last mile delivery transportation
| 1. High competition due to fragmented nature of business
2. Withdrawal of the plan of disinvestment due to Covid-19
3. Large e-commerce platforms launching their own transportation and logistics initiatives
4. Periodic shortage of drivers in the transportation business
|
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Detailed SWOT Analysis of XPO Logistics
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.
The remaining section of “Strength” is available only in the 'Complete Report' on purchase.
Weakness
This section is available only in the 'Complete Report' on purchase.
Opportunity
This section is available only in the 'Complete Report' on purchase.
Threats
This section is available only in the 'Complete Report' on purchase.
The PESTLE / PESTEL analysis for XPO Logistics is presented below in a table followed by the detailed analysis report.
| Political | Economical |
1. Imposition of tariff on imported goods in US and EU affecting global forwarding business
2. Impact of Brexit on the business of logistics and transportation
| 1. Impact of fuel prices on the transportation business
2. Uncertainty of demand due to Covid-19
|
| Social | Technological |
1. The driving force of seasonal demands in last mile delivery business
2. Rising popularity of e-commerce as shopping medium
| 1. Implementation of cloud computing and technology in logistics and warehousing
2. Importance of digital connectivity in last mile delivery business
|
| Legal | Environmental |
1. Requirement to adhere to safety and environmental regulatory compliances in the logistics business
2. Adherence to various regulations related independent contractors and international cargo transports
| 1. Impact of operations due to exposure to harsh weather conditions in transportation
2. Launch of environment friendly fleet to reverse the damage in environment due to transportation
|
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Detailed Pestle Analysis of XPO Logistics
Political
This section is available only in the 'Complete Report' on purchase.
Economic
This section is available only in the 'Complete Report' on purchase.
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.
The remaining section of “Social” is available only in the 'Complete Report' on purchase.
Technological
This section is available only in the 'Complete Report' on purchase.
Legal
This section is available only in the 'Complete Report' on purchase.
Environmental
This section is available only in the 'Complete Report' on purchase.
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TABLE OF CONTENTS
DELIVERY AND FORMAT
WHY CHOOSE US?
You may also be interested in other analyses of XPO Logistics:
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| XPO Logistics VRIO Analysis |
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| XPO Logistics Value Chain Analysis |
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Check Out Analysis of Other Relevant Companies
References used in XPO Logistics SWOT & PESTLE Analysis Report
1. XPO logistics annual report 2019 - https://investors.xpo.com/static-files/b5c2f2b1-855d-4feb-92df-62731ea73ea6
2. XPO Logistics To Explore Breakup - https://www.forbes.com/sites/joecornell/2020/01/21/xpo-logistics-to-explore-breakup/?sh=6ebab8043747
3. New Report Claims Extensive Worker Abuses at One of the World’s Largest Logistics Companies - https://www.vice.com/en/article/935x4y/new-report-claims-extensive-worker-abuses-at-one-of-the-worlds-largest-logistics-companies
4. XPO Logistics Debt to Equity Ratio 2006-2020 - https://www.macrotrends.net/stocks/charts/XPO/xpo-logistics/debt-equity-ratio
5. E-Commerce And Grocery: This Time It’s Real - https://www.forbes.com/sites/neilstern/2020/04/27/e-commerce-and-grocery-this-time-its-real/?sh=48a1bbd65d65
The detailed complete set of references are available on request in the 'Complete report' on purchase.
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XPO Logistics SWOT and PESTLE analysis has been conducted by Tej Narayan Shaw and reviewed by senior analysts from Barakaat Consulting.
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