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FedEx Strategic Planning: The Worlds Largest Transportation Companies
FedEx company has built its reputation through its speed, reliability, and high-quality services. By 2019, the company had been rated by Forbes magazine as one of the #35 top companies with the best employers (Dowd, 2021). The company has invested in creating new ideas that have increased its value over the years that it has been active. For instance, FedEx was the first top company that had made overnight shipments. Through constant ventures, FedEx has boosted its financial strengths to higher grounds. As such, this corporation has created opportunities and filled the existing space in the shipping industry. Despite the good performance through their strengths, the company has also faced a few weaknesses that have dragged their financial performance over the last couple of years in the shipping market. In essence, through the SWOT analysis, FedEx is expected to perform better even in the future.
The company has a strong network of information systems, which helps them serve its customers efficiently and communicate with other companies. FedEx has a strong market ground because it operates in over 220 countries worldwide through its express deliveries. The fact that the company is diverse in terms of the nature of the products they display in the market implies that its network is strong. Research by Jacobs et al. (2019) has affirmed that companies with strong networks are more likely to perform better because of their high sales and marketing skills. More significantly, it becomes easy for the company to extend its market segments. FedEx has expanded its market segments over many countries, the USA being the stronghold market for the products. Therefore, FedEx continues extending its market strength to many economies in the world and creating a better revenue stream through the diverse network.
The company is valued at a brand value of over $6.8 billion in 2019, thus able to fund its activities and innovations, leading to an increase in the market (FeDEX, 2022a). The stream of income and capital available to a company is one of the major factors that has limited the performance of many companies worldwide. However, FedEx has become one of the companies that have supported its activities through a high stream of income (FeDEX, 2022b). As a result, the company operates many activities and has ventured into the stock market. Their company has funded many innovations and created more strong networks through online systems. The major aim is to control the companys security, among many other essentials of the firm. Thus, the company has operated a stronger market base with a high capital initiative.
The company is reliable in delivering its goods on time within a shorter period than others. Further, it has a real-time tracking service that enables customers to monitor their goods in transit and when to expect them, increasing customer satisfaction. The company has also invested in more shipping networks that have helped ship the products within a short time. The many air transport vessels have helped make convenience and fast delivery a priority to the customers. As such, it has been easy for the company to increase its market ventures and promote its activities without financial strain. FedEx has promoted a higher stream of activities through the value of time and the fast delivery of its services to the market. Thus, the companys key stakeholders have benefited highly from the consistent flow of income as well as the key potential structures of growth in the future.
The company has effective marketing strategies which reach many people through its marketing platforms, such as sporting and movie events. In addition, FedEx has leveraged partnerships with other companies that depend on their shipping platforms and vessels as a key marketing strategy for their services (FeDEX, 2022b). Despite that, as companies grow, their market structure will keep changing; the company that relies on FedEx services has constantly supported the firms key marketing goals in the market. As a result, both FedEx and the companies have gained substantially from the marketing structures. In addition, FedEx has invested in online marketing strategies like website and social media, increasing and expanding their market segments.
Weaknesses
Overdependence on the US market, with the company making over 50% of its revenue from the country. This poses a great risk, especially if the country faces economic challenges, which might lead to a decline or closure of the company due to reduced funds and market. The fact that the company depends on the USA market implies that the other firms will invade the other markets. Even though the USA is a stronghold of their services, other markets must also be invested in (FeDEX, 2022b). The USA market has threatened the company because it cannot survive if it quits the USA market. The other market potentials of the company have not ventured more than the USA. Therefore, this has created a bigger challenge because balancing the strictures to boost performance becomes hard without the USA market being placed in the picture.
The unruly staff, especially drivers, have been reported to have rude behaviors and harsh driving, which reduces customer satisfaction. Despite the reporting, no legal actions have been taken against them because they are contracted hence not company staff. Furthermore, the company has ignored taking action on the customer claims from staff. As a result, many customers have left bad reviews on their site, negatively impacting their sales (Morciano et al., 2020). Customer satisfaction is the key element in any service delivery company. As such, any claims the customers have raised must be taken action. Therefore, FedEx is constantly losing customers because of the unruly staff behaviors.
Some customers have reported frustration during policy claims in cases where the goods delivered were damaged. This reduced customer confidence in the companys online purchases, which the company capitalized on. For instance, when the customers have received their goods and, in any case, they have been damaged, the company has taken steps to ensure that the products are paid for and better actions are taken. This implies that customers will continue being frustrated with their services. As a result, the customers are expected to drop yearly, which is a bad sign for a big firm like FedEx.
As a winning strategy, the company has poor management of its resources in the logistic sector. Management of resources is a key goal for any company; as such, FedEx has mishandled its resources to win more customers and better market performance. The major challenge has been how to fund the other activities when the company needs the funds. The company has suffered from these challenges for a long time, which has limited its sales capacity because, at times, the required resources are lacking. Therefore, this has limited the companys expected performance in the market by creating unexpected barriers.
Opportunities
Increasing high-tech is the major venture that the company has created room for in the future. The company has constantly invested in strong systems that are likely to perform better in the market. The major aim is to control data breaches and have maximum security of the customer data online. For example, based on the current structures, the company is building initiatives to keep customer products in a good state. More significantly, focusing on security and other major policies will improve the customer service in the market. Therefore, the high value of technology is expected to be a key leader in many shipping companies because the network will be diversified.
Globalization is a major initiative for every shipping or any company that operates both offline and online markets. FedEx has prioritized globalization because of the benefits that accrue because of the existing market objectives and policies. The company is expected to venture into technology and the production of most of its goods to help reduce transportation costs. For example, by increasing the shipping vessels, it will be easy to create a better model of transporting goods to the required destination. Therefore, the shipping cost is expected to go down, which will increase the number of customers for FedEx company in the market.
Acceleration of the supply chain to close the wide gap between the customers and the company. As a result, FedEx can take advantage of the online platforms and sales and marketing strategies that are direct to the customers. By reducing the supply chain gap length, it will be easy for the company to have a reduced cost of shipping the customer products (Morciano et al., 2020). Despite the increased cost of living, the gap will always reduce the cost because of the reduction of the cost of funding the long supply chain elements. Thus, it will be easy for FedEx to achieve the required goals and objectives.
Use the internet in e-commerce to promote the companys online services to customers. E-commerce is the greatest venture for all companies online, promoting and generating more sales. Therefore, the company should take advantage of the growing technology and have e-commerce as a major initiative to promote the company and create a better resource to extend its market and sales revenue. As a result, FedEx is expected to increase its sales because of the better implementation of the eCommerce platforms. Therefore, eCommerce is the leading venture online globally that FedEx can take advantage of in the shipping market.
Threats
FedEx faces stiff competition from other companies that have invested in other market segments excluding the USA. FedEx mainly relies on the USA market and has not invested on the other market segments. As such, DHL, C.H. Robinson, TNT and UPS have invested in the other markets including the USA. These companies have given FedEx more competition which has reduced the revenue of the firm. Therefore, competition is the major threat that FedEx faces in the market.
What makes FedEx Special
FedEx has a guaranteed day-definite within USA and Canada at a reduced price. The assurance increases customer assurance over its competitors, such as UPS, who might delay and charge slightly higher delivery fees. The day-definite has enabled FedEx to achieve its customer goals by lowering the price of FedEx services in the market. Every companys goal is to have its products affordable to the customers in the market. However, the fact that FedEx gives the customer a priority by making their price claims more essential has increased the demand for their services compared to the other companies in the market.
Express transportation of orders to customers within a given period. This reduces the waiting time making the company reliable, especially for distant order deliveries. FedEx has ventured into the routes that have express routes to avoid delays in their services to the customers. The major aim is to provide the expected quality of goods at the expected time to win their trust (Galbach, 2020). Customer trust plays an essential role in boosting the rates of referrals. Through this element, FedEx has earned a huge customer base, boosting its sales to the external markets. Therefore, the company has won big in terms of marketing because of the express routes that have been applied in transporting the products.
E-solutions creates an interactive online between the customer and the company. Timely response time increases customer satisfaction. The company has invested in technology which has served as an automatic boost because of the impact on customer trust and satisfaction. More significantly, the quick response has improved the quality of services the company offers in the market. Alternatively, the company has hired experts who keep updating the systems to ensure that the customers always get the best services at the end of the process. Therefore, this strategy has helped increase the number of customers and market the company to more market segments.
Regression Analysis
Analysis of the results
The company has an R coefficient of 0.962 which is slightly below 1. The coefficient implies that the firm is performing well and has taken good use of the opportunities, solved its weaknesses. However, the major challenge is one the threats. More significantly, the other competitors have invaded the USA market which is the major segment. FedEx should come up with ways of expanding their market to other economies to grow their revenue streams. Thus, it will be easy for the coefficient to get to 1 for a better performance in the future.
References
Dowd, K. (2021). Forbes Global 2000: The Worlds Largest Transportation Companies. Forbes. Web.
FedEx. (2022a). Overview of company | FedEx. Investor Relations | FedEx. Web.
FedEx. (2022b). The past, present and future of FedEx innovations. FedEx. Web.
Galbach, P. (2020). FedEx express hydrogen fuel cell extended-range battery electric vehicles. Web.
Jacobs, S., De Vos, A., Stuer, D., & Van der Heijden, B. I. (2019). Knowing me, knowing you the importance of networking for freelancers careers: Examining the mediating role of need for relatedness fulfillment and employability-enhancing competencies. Frontiers in Psychology, 10. Web.
Morciano, C., Errico, M. C., Faralli, C., & Minghetti, L. (2020). An analysis of the strategic plan development processes of major public organisations funding health research in nine high-income countries worldwide. Health Research Policy and Systems, 18(1). Web.
Do you need this or any other assignment done for you from scratch?
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