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2023/2/26 STRATEGIC MANAGEMENT
10833022 Palija shakya 10833025 Ansonglang 10833027 Sunika
Comparative advantage of FedEx
1. Expand into Emerging Markets Demand for the courier, logistics, and freight services, is increasing rapidly in emerging economies in Asia, Africa, and Latin America, along with improvement in economic situation. FedEx can expand its operations in these economies to tap into the growing demand**.
- Focus on retail e-Commerce** Global retail e-commerce sales are forecasted to grow from $3. trillion in 2019 to $6.5 trillion in 2023. FedEx has the opportunity to capitalize on the growing demand for delivery services in the retail e-commerce sector. 3. Diversify Portfolio With its extensive global network already functional, FedEx has a major advantage over many online retailers. FedEx can diversify its portfolio by entering into the online retail sector. 4. Expand through Mergers and Acquisition
Instead of investing immensely to set up from scratch in new markets, FedEx can exploit its vast financial resources to acquire small and medium couriers in these markets for quick expansion.
5. Innovation FedEx continuously innovates to fulfill customer needs. It has gained the trust and business of major corporations and ordinary consumers. FedEx is currently one of the most innovative companies in logistics and freight. For example, Package Tracking : FedEx was the first logistics company to provide package tracking Same Day Bot Delivery : FedEx has collaborated with DEKA (inventor of Segway) to develop an autonomous delivery robot “iBot.” In addition, FedEx is working with retailers such as Target, Walgreens, Walmart, and Pizza Hut to help with their delivery. Block chain technology will be an essential tool to track and reduce fraud in cross-border shipments. Platooning of highway trucks to improve safety: FedEx is testing the practice of platooning of trucks, in which two or more trucks maintain a close distance between each other in a controlled manner using connectivity technology.
Sustainable Competitive advantage of FedEx
1. Brand Reputation
FedEx operates in 220 countries across the world, with 2150 offices, 370 service locations, 13 Air Express hubs, 39 Ground hubs, and 1,950 operation express stations. From America to Europe, Asia, and across the world, FedEx’s unparalleled global network reaches every corner.
5. Competitive Prices Regardless of what you are selling, price matters to consumers. FedEx exploits economies of scale to offer quality service at a competitive price. 6. Time-critical deliveries When it comes to package deliveries , time is of the essence. If a customer orders an overnight delivery, they are assured (with a real-time tracking) that FedEx will deliver on their doorstep the next day, which has enabled attraction and retention of customers. 7. Profitable Acquisitions Through acquisitions, FedEx has broadened its global reach and services with subsidiaries such as: Kinko’s Inc. (2004) Parcel Direct (2004) Watkins Motor Lines (2006) Prakash Air Freight (2007) TATEX (2012)
GENCO (2015)
TNT Express (2016) Flying Cargo Group (2019)
8. Effective Marketing From famous Tom Hank’s movie like Cast Away to sports, and creative TV ads, FedEx has exploited the power of marketing with a purpose very effectively. Some of the FedEx sponsor events: FedEx Cup on the PGA Tour French open tennis tournament ATP World Tour men’s professional tennis circuit NASCAR Sprint Cup series National Football league (NFL 9. Electric Trucks FedEx has made a reservation of 20 Tesla fully electric trucks. FedEx has always focused on sustainability and utilizing alternative-fuel vehicles to increase efficiency in operations and fuel usage.
