Presented by

. Chin-Jao Chin Jao Chen Bharat Malli

Company Background
The company was founded in 1971 Headquartered in Memphis, Tennessee. Owns largest Air cargo fleet in the world Connecting 90% of the Worlds GDP in 24-48 hours. Average Daily Volume of 6 Million Packages o 220 countries served o 250,000 employees worldwide o 674 aircrafts o #70 in fortune 500 o #6-Most admired company Market Cap: 28.07B$ Income :2.02 B$ P/E (ttm):13.96 ( ) 13 96 EPS (ttm):6.40 Div Yield:0 56 Yield:0.56 Frederick W. Smith Chairman, President and CEO

Divisions

Time-definite express delivery

R i l Regional LTL Carrier

F i ht Forwarder, d Freight F Customs Brokerage

Sales, IT & Marketing

Small-package ground delivery d li

Exclusive-use, expedited, Door-to-door delivery

Copy Printing & Document Solutions

Segment Analysis

Operational Revenue in $Millions

8,708 YR 2012 YR 2011 YR 2010 1,671 1,747 307 1 028 1,028 782 6546.00 8,791 5,282

Operations Tracking Example

Supply Chain Network

FedEx has Divided its express network into zones, Central shipping locations(CSL) and forward shipping locations(FSL) 1. USA Memphis is CSL and 6 other FSLs 2. EU i i d h Paris is CSL and 4 other FSLs 3. India FSL s Delhi is CSL and 2 other FSLs 4. China Shanghai is CSL and 3 other FSLs g 5. Australia One FSL at Sydney

Supply Chain Technology

FedEx Ship Manager Software is a free of charge, selfinstallable software suitable for all shippers. pp Includes customs documents such as commercial invoice, textile declaration, etc

FedEx DirectLink
FedExs F dE own private value added network , EDI-based i t l dd d t k EDI b d Business-to-business data exchange Shipping, Shipping tracking and invoicing data

SAP R/3 and CRM

Utilizing the power of SAP , FedEx is able to provide real time tracking, shipping and advanced planning options its customers and shipping offices around the world. hi i ffi d h ld

Serves all needs S ll d

The following are the key features offered by FedEx: On time delivery Ship any size packages Secure shipping Perfect tracking throughout their supply chain g g pp y

Customized services Pick-up offices, Pick up at FedEx offices schedule the delivery at later date Choose between various speed VS cost options One Stop shopping National , International, Air freight Cargo International Air, freight,

FedEx 3PL - 4PL

The F Th Fourth Party L i i or 4PL term was first used and registered as a hP Logistics fi d d i d trademark by the firm Accenture in 1996. "A supply chain integrator that assembles and manages the resources, p , gy g p y capabilities, and technology of its own organization with those of complementary service providers to deliver a comprehensive supply chain solution." 1) All aspects (ideally) of the client's supply chain are managed by the 4PL organization; and, It is possible for a major third-party logistics provider to form a 4PL organization within its existing structure. structure g The fact is that most 4PL organizations are either 3PL or Business Process Services organizations (Accenture, CapGemini, Deloitte). Virtually all have either their own assets or strong relationships / agreements with other logistics parties. FedEx Trade Networks / SCS

Optimization of speed - cost

Overview FedEx Overnight

Order starts in china at 4:30 pm Collected at distribution center by 6:30 pm Marked and sent to CSL/FSL by 8:30 pm Loaded into Air freight by 11:00 pm Flight leaves China at 11:30 pm

Arrives in USA at 11:30 pm !!! Customs and other formalities cleared 2:30 am Airport to FedEx ground CSL/FSL 6:30 am FedEx ground ships to local office 8:30 am Reached the destination atleast by 10:30 am!!

5 Forces Analysis
Threat of new entrants: Low Bargaining g g Power of Suppliers: Low L

Competitive rivalry within industry: High

Threat of substitute products: Medium

Bargaining Power of f Consumer: Medium

SWOT Analysis
Strengths
Overnight shipping from around the world, On time delivery On-time Largest Air cargo fleet Infrastructure of equipment and processes C Complete EDI system and advanced l t t d d d tracking Advanced customs clearances

Weakness
Massive fixed costs Legal proceedings Week profitability in air division Weak ground operations

FEDEX
Opportunities
p Further expansion in international markets Shipping for armed forces Technological innovation Implement 4PL systems s stems Improve the efficiencies in Air operations

Threats
Competitors like DHL starting air fleet Increasing commodity costs Raising Oil prices Decreasing value of electronics cost per unit Increasing Shipments via Sea

Recommendations
Improve the Operating margins on FedEx Express Shift to more fuel efficient ground vehicles not only in FedEx ground but also in FedEx express Expand the 3PL services to restore volume growth in Express Higher integration of FedEx ground with Express required Adopt more 4PL services as the services result in direct and indirect $$

Thank You!

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