Fedex SWOT Analysis 2021

FedEx SWOT Analysis 2021

SWOT analysis by FedEx examines the brand’s performance based on its strengths and weaknesses, as well as opportunities and threats. 

In the analysis of FedEx SWOT Analysis, it is clear that the advantages and disadvantages are internal elements, while the opportunities and threats are external elements.

SWOT Analysis is a tried and tested management tool that allows brands such as FedEx to evaluate their performance and performance in comparison to their other competitors. FedEx is among the top companies in the transport and logistics industry.

The table below outlines details of the FedEx SWOT (Strengths Strengths, Weaknesses, Opportunities threats) as well as the most prominent FedEx competitors, and also it’s market target segmentation, positioning, and the Unique Selling Proposition (USP).

fedex swot analysis

Background of FedEx

Name FedEx Corporation
Website https://www.fedex.com/
Founders Frederick Wallace Smith
Chief Executive Officer (C.E.O. ) Frederick Wallace Smith
Tagline What happens now and what’s next
Headquarters Memphis, Tennessee, U.S
Type of Corporation Public
Year Founded April 17th, 1973
Revenues (2019) $21.5 B
Key Products/Services Courier, Logistics, Freight, Sales, Marketing, Information Technology, Communications, Customer Service, Technical Support, Billing and Collection Services, Back-Office Functions
Key Competitors United Parcel Service (UPS), DHL, Nagel, CEVA Logistics, Blue Dart, Royal Mail, C.H. Robinson, Deutsche Post, DB Schenker, GLS, XPO Logistics, YRC Freight, Uber Freight

Introduction to FedEx

One of the leading logistic companies across the world is FedEx. It is a well-known company which is a product of America.

The United States of America. It has grown into a well-known and respected name in America which deals in delivery services.

In the case of an analysis of the FedEx SWOT Analysis, The abbreviation for FedEx can be referred to as Federal Express. 

The name was initially used between 1973 and 2000. The American firm is more popularly known as FedEx. 

The company is involved in delivery services. It is known as the first major business in shipping to offer overnight delivery. This company is even one of the main contractors for the federal government of the USA.

Step by Step Guide to FedEx SWOT Analysis

Strengths:

fedex swot analysis

  • Brand Recognition: FEDEX has established an impressive brand name in the US and around the world. Brand recognition is an essential factor in a strong business across the globe. FedEx is now an essential supplier chain partner for companies. A strong brand image of FEDEX is due to the consistent supply of high-quality services for the last several years. Alongside effective services delivery, the company has also been focusing on customer service, which has led to higher trust and a greater awareness of the brand.
  • Global Presence: FEDEX is an international brand that serves customers in over 200 nations. Its global network that includes ground and air transportation services offers delivery of packages and freight to over 220 territories and countries through many different U.S. and international shipping services.
  • Innovative and technological capabilities The HTML0 platform is a technological marvel. FedEx is always been focused on technological innovations to increase efficiency and better customer service. It has embraced cutting-edge technology that allows customers to easily pick up and drop off from over 50,000 locations in the US alone. Every day, it collects and delivers around 14 million packages. FedEx employs an array of 670 aircraft as well as greater than 180,000 motor vehicles for pickups and deliveries every day. Additionally, Hub expansion and technological advances have made FEDEX’s network of the ground the most automated ground network. There are more than 130 automated facilities that allow FEDEX to reduce its volume during the Christmas season. The company is also investing in modernizing its fleet and has bought aircrafts such as the Boeing 777F which use less fuel per pound of payload.
  • Solid financial performance:– The company’s financial performance over the last few years has continued to improve. Revenue in 2018 was up by about 9 percent when compared with the year prior. Revenue climbed to 65.5 Billion while net income was 4.6 billion dollars during the year 2018. The company is on the path to achieving its goal of increasing its net operating earnings to 1.2 up to 1.5 Billion in 2017 through 2020. In 2016, its revenue reached 50.4 Billion dollars. It grew by 60.3 billion dollars by 2017, and 65.4 Billion dollars by 2018. FedEx is working towards increasing its revenue even faster in the near future.
  • Wide range of services Broad service portfolio FEDEX has created the broadest range of services available to its customers to satisfy the needs of a broad variety of customers. Different customer segments have different requirements that require to be fulfilled. FedEx meets the needs of both large and small companies as well as individuals. It offers a variety of online commerce, transportation, and business services via companies that compete together, but operate independently, and operate collaboratively as part of FedEx. FedEx brand. The main operating companies of FedEx include FedEx Express, TNT Express, FedEx Ground, ad FedEx Freight.
  • Strategic acquisitions: This company made a number of strategic acquisitions in order to expand the range of services it offers. In March of 2018, it purchased P2P Mailing Limited which is one of the leading providers of global affordable e-commerce shipping solutions in exchange for PS92 million ($135 million) in cash flow from operations. It also purchased Northwest Research Inc., an industry pioneer in research into inventory and management, for $50 million. TNT express gathers moves and delivers parcels, documents, and cargo to more than 200 territories and countries. FedEx bought the business for 4.4 billion dollars in the year 2016.

FedEx’s Weaknesses

fedex swot analysis

  • Overdependence on US Market: A substantial part ( 68%) of the revenue of FedEx comes directly from its US market. $47.5 Billion out of the total revenue total of $69.69 Billon comes from the US market. If there are problems with the economy within the US market, FedEx’s revenues could plummet dramatically.
  • Lack of Diversification: As with any other service-based business FedEx’s stability is improved by the diversification of its offerings.
  • Delivery Drivers Behavior: Unprofessional treatment of package deliveries, rude conduct or reckless driving of its drivers can be harmful to the image of the business. Most of the time, these drivers are contractual and not FedEx employees making it more difficult to take action.
  • Increasing Transport Costs: To accommodate the growing need, FedEx hires third-party transportation companies. It is approximately 24 percent of its expenses for FY2019. Its bought transport costs are rising rapidly throughout the globe. If costs for transportation continue to rise the impact could be detrimental to FedEx’s bottom line. FedEx.
  • Frustrating Claim Policies: Many customers are getting frustrated with FedEx’s claims policies in the event their items are damaged in shipping. If the company fails to resolve issues related to their claim policies, they could be left out of the growing amount of customers who shop online.
  • Poor Management of Capacity-Demand: Although having the ability to deal with a significant quantity of parcels in the logistics sector is a successful strategy, however, poor management could result in inadequate utilization of capacity. FedEx has made an enormous investment in vehicles, aircraft, and technology, as well as package facilities as well as other facilities. Since the fact that these costs are fixed expenses, the uncertainty of the volume of delivery can greatly impact the financial performance of the business.

Potentialities

fedex swot analysis

  • Ecommerce boom one of the main benefits FedEx is able to offer, particularly in emerging countries is the fact that the online explosion is picking up speed, and transport is in high need. Because of this the number of packages moving every day that it is at 100% utilization. FedEx is already equipped with the resources to meet the demand in E-commerce and has a competitive rate of becoming the industry leader.
  • The boom in online retail The boom in online retail While E-commerce is a reference to online shopping sites such as Amazon, Flipkart, and many others There are many small-scale retailers beginning with their own online store. This implies that even small-sized businesses are becoming involved in delivery from point to point, thereby expanding the overall marketplace potential, particularly in the developing economies.
  • Speeding up systems The primary chance for any company will be making their system faster, which will lead to greater customer satisfaction.
  • Strategic tie-ups FedEx already has tie-ups strategic that are in place with all companies that sell on the internet. However, their exposure is less in developing nations due to regional competition. This means that more strategic partnerships with larger companies will result in an increase in the proportion of the market. So, the corporate push to increase customers into the company is essential for the company at the moment.
  • mergers and acquisitions FedEx has made a great acquisition in the shape of TNT express. Europe is the main field for FedEx currently. Similar acquisitions across the globe will assist FedEx to increase its overall presence on the market.
  • Improve the retail channel While the majority of the bulk of the movement is B2B but there is significant coverage of B2C. Customer-to-customer courier is an area where FedEx is in a great position to compete with the competition, especially in developing economies such as India and others. In this case, FedEx must boost the number of deals it offers and also its retail channels.

FedEx Threats

fedex swot analysis

  • New Rivals. FedEx is currently operating in a highly competitive market. It is required to be vigilant particularly since new competitors are set to join the market, such as Amazon-a client from FedEx as well as Uber Freight. Uber and Amazon are both able to access the same resources as FedEx has, and therefore they are poised to surpass FedEx. This could result in fewer customers for FedEx.
  • Currency Fluctuations. FedEx offers services throughout the globe. Therefore, it conducts business in a variety of currencies. If fluctuations in currencies occur and the revenue of the company could decrease. Furthermore, if the US dollar appreciates around the world, it will result in lower profits for companies based in the US like FedEx.
  • Fuel Prices Fluctuations. FedEx makes use of fuel to deliver packages around the world. It owns the company’s own fleet of aircraft as well as trucks along with other automobiles. At present, FedEx already has high operating expenses. If fuel prices rise, the operating expenses for FedEx will increase as well. This could result in lower profits.
  • Uncertainties. All businesses must face uncertainties, such as COVID-19, a pandemic. Most importantly, COVID-19 resulted in lockdowns in a number of countries. Travel was severely restricted because of lockdowns. With its fleet of vehicles which includes aircrafts FedEx is at risk of a reduced operation for the rest of time until the COVID-19 epidemic is over.
  • Global Recession. Global economic recessions can affect FedEx’s operations. At present, a large portion of FedEx customers is slipping into recession because of the impact of COVID-19. Therefore, FedEx’s earnings will drop significantly and be slowed down until 2021.

FAQ

What is the mission of FedEx?

The FedEx mission statement reads “FedEx Corporation will produce superior financial returns for its shareowners by providing high value-added logistics, transportation, and related business services through focused operating companies.” It provides the most important projects and initiatives that the corporation plans to execute to

What challenges does FedEx face?

Presently, FedEx faces fierce competition from (i) less capital-intensive local transportation firms and even startups and startups, which is why FedEx stands out through its global reach and an efficient service, and (ii) large volume shipping companies, like Amazon which are now consolidating their logistics and could turn into an affordable alternative.

What is the differentiation strategy used by FedEx?

FedEx has also implemented differentiation strategies at its business units. It is determined to differentiate itself from the competition by offering high-quality services that are not matched by other companies within the sector. FedEx has a higher price for its unique services.

Why is FedEx so successful?

In the past, it has grown its reach by the acquisition of companies similar to its own and also by adding retail stores. The company’s success is because of the happiness of its customers as well as its employees. When a client hires FedEx they can be assured that the package will arrive in time.

What is FedEx motto?

Because the main FedEx color is purple and the FedEx motto is often referred to as “The “Purple Promise,” which includes “Do whatever it takes to satisfy our customers” and “Always treat customers in a professional, competent, polite, and caring manner.” I’ll bet on this!

What is the purple promise for FedEx?

The Purple Promise is, ” I will make every FedEx Experience Outstanding“. The coin’s recipients have demonstrated results that go over and above to deliver top-of-the-line service and enhancements in customer satisfaction or financial improvement.

Conclusion

In short, FedEx’s strategy for market success is built on a mix of customer knowledge operational excellence, as well as product leadership. 

To provide the fastest, most convenient service and with a lower cost than its rivals, FedEx relies on its outstanding operating system.

FedEx concentrates on its advertising, sales, and IT systems that allow its delivery process to be completely automated.
* Continued growth through acquisition
* aspire to grow through alliances and alliances
* Increasing revenue from existing products, and expanding markets for

In this SWOT study, the company has highlighted all of the strengths as well as the weaknesses, opportunities, and threats to FedEx in the marketplace. 

To grow its market share as well as its financial stability, FedEx must take vigorous actions. However, despite its negatives, it is, without a doubt, a symbol of growth and creativity.

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