Welcome to

Rodrigo Loya Maria A. Silva Colin Green Sandra Vargas Melanie Rivera Jhael De Alba

History
Founded in 1971 by Frederick W. Smith. First Investment 1980s:
FedEx reached its maturing stage. First US company to reach $1 billion in revenues.

FedEx handles 3.3 million packages

General Environment
Global Provider of: - Transportation - e-commerce - supply chain management FedEx an Innovator company: - Overnight package and letter delivery - 10:30 am next day delivery - Saturday delivery service

Most familiar service. Handles millions of shipments. Delivers in 1 to 2 business days.

Cost effective. Alternative for small packages. Distance and time are wider.

When customers need it now. 24hrs. 7 days a week, including nights, weekends and holidays.

Heavy weight shipments. Less than truck load (LTL) freight. 600 miles next day delivery. 1,600+ miles second day delivery.

Custom brokerage. Electronic custom clearance. Speed shipments across the border.

External Environment
Household name Competitive environment Global Presence IT advances Strong market position in air freight

Competitive Environment
World wide presence Dominates ground services domestically High market share in the US Acquired full ownership of Mail Boxes, etc. Intense competition with FedEx

Competitive Environment
Recent acquire of ground services Specialize in air freight deliveries Global presence Other mergers, the effects.

Competitive Environment
Largest customer, but strong competitor Attempt injunction against the alliance

Internal Evaluation
Management
Uses strategic management in planning and meeting goals

Marketing
Major advantage by being a household name

Strong in its corporate structure Able to respond to a with low absenteeism and low changing consumer turn over rates at the corporate environment by operating level, by paying well and showing respect independently completely and collectively 2002 hours were reduced, with wages and benefits increasing but with profit and incentive sharing plans reduced

Internal Evaluation
Finance/Accounting
Fairly strong financial position Year 2002 Highlights include large free positive cash flows, 22% increased net income and a $.05 dividend declared on common stock. Fairly weak in leveraging; incurred large amounts of debt for an expansion project.

Production/Operations
Industry leaders in Air Express Handles well over 3 million packages daily. Excellent ground crew & pilots 24 hour customer service

Internal Evaluation
Research & Development
Very innovative R&D team. Six year expansion plan
Estimated cost of over 1.8 Billion Doubling package volume capacity 10 new distribution hubs & 23 expanded hubs Relocation or expansion of up to 300 existing facilities Expected completion in 2009

CIS
Highly innovative software user and designer. Very aware of competitors programs and systems. Constant and up to date system employee training.

SWOT Analysis
Strengths
Household name Product quality Global expansion Abreast in technology Air fleet

Weaknesses
Employee racial discrimination Lack of ground transportation force Costly technology innovations Judgment for late deliveries Increased debt

SWOT Analysis
Opportunities
Global business growth Online consumer services Increase demand in logistics Alliance with USPS

Threats
Foreign competition entry into home Economic standing Online competitive advantages of rivals Gain in competition service costs

Strategy Formulation
Strategy 1
Online subsidiary with a consumer retailer
Creating a collaborative union utilizing technological strengths and online consumer industry growth to provide full consumer opportunities through the convenience of e-commerce Multiple strengths, opportunities and positive industry strength (SWOT Analysis, Space Matrix)

Strategy Formulation
Strategy 2
Travel
Last minute discount air travel tickets available to the public in order to gain additional profits from the already existing and operating transportation system in use Major positive strength and opportunity (SWOT Analysis, Space Matrix)

Strategy Formulation
Strategy 3
Mail Enhancing and providing existing postal services formally provided by USPS Strong opportunity and high competitive advantage (SWOT Analysis, Space Matrix)

Evaluation of Alternatives
Forward Integration
Online Subsidiary With Consumer Retailer
Larger companies become more profitable
Ex: Wal-Mart, Target

Company is equipped and able to expand in this area

Leadership, technology, and equipment

Use strengths and opportunities as mentioned in analysis

Online consumer growth is expanding Company is abreast in technology

Evaluation of Alternatives
Horizontal Diversification
Travel
Currently operates one of the largest airlines in the world
Has fleet of over 380 jets Jets have state of the art instrumentation

Already employs more than 4200 skilled pilots Has some of the best air travel technology and equipment Highly capable to execute

Evaluation of Alternatives
Concentric Diversification/Horizontal Integration
Mail Opportunity from SWOT analysis Existing contract with USPS Future services to be rendered to private outside provider Capable of providing additional USPS services

Evaluation of Alternatives
Mail

Counteracting competitive strategic moves USPS recognition of lack of resources

Strategy Implementation
Strategy 3:
Concentric Diversification/Horizontal Integration Mail Additional personnel Insurance Training
employee evaluations

Strategy Implementation
Mail

Service sites by way of franchise

UPS and Mail Boxes, etc.

Ample resources to accommodate USPS needs Expansion project can handle additional/new inflows
Extra packages and mail

Strategy Implementation
Mail

Advertising
TV Internet Sporting events/arenas New labeling on boxes

Pop Quiz

a. b.

c. d.

and remember to mail by

Mail