The Competitive Advantage Of Fedex

Chapter 1. Introduction

The transportation, e-commerce and business services are very competitive and sensitive to price and quality of service. FedEx not only faces competitors from international companies that perhaps subsidized by foreign government, but also competes with regional companies that operate smaller but each has competitive advantage which would in turn reduce FedEx’s revenues and market share.

For example, according to reuters.com.UPDATE 2-Deutsche Post banks on emerging markets, e-commerce. 02 April 2014. One of FedEx’s competitor, DHL started to grabbed market share after they focusing their business in express delivery, freight and supply chain business. DHL also invested in expansion in Asia and become market leader

Based on the case study, speed became of significance to achieve competitiveness. Therefore, I assume FedEx’s quality is the on-time delivery. To maintain quality, we propose delivery agreement contains guarantee of delivery. FedEx also covered it already. They said if the customer’s FedEx express is delivered even 60 seconds later than FedEx’s promise, they can get their money back. However, the money-back guarantee only applied to FedEx express and FedEx ground service. I think it is better applying the guarantee to all services, including FedEx freight.

e. Availability

The method of distribution can itself be the main competitive edge on which a firm bases its positioning. FedEx has significant investments in technology, aircraft, vehicles, facilities, and package handling and sort equipment but they forget to allocate more investment in expansion. For example, in the capital city of Indonesia, Jakarta, FedEx only has 6 service points while DHL has 14 service points in all over the city. I was DHL customer back in Indonesia because it is easy to find and many people recommend it. That is why we should allocate more investment in expansion.

f.

Consensus Judgement

Experienced managers agree that there is probably a worthwhile benefit to go for, their views deserve to be heard. For FedEx, we can establish some kind of coffee morning once every week for managers to have sharing knowledge. Use video conference to eliminate the distance problem and we can gather managers in all over the country.

c. Championing

Strong and enthusiastic champions are important for the effective implementation of new intervensions. In Indonesia we have Gen-Y generation community comprised young staff age 22-33 year old. We have periodic meeting to discuss about the latest problems and actions to overcome them. In FedEx we can do the same, creating community, comprise young people from all division (usually they are ambitious and eager) having meeting periodically and give them a chance to present the ideas.

d. Creativity and Realism

Encourage managers with new ideas to come forward, encourage brainstorning that will generate fresh thinking. We can implement this by conducting innovation competition. Set up prize and for the first winner, they can present their idea to the board of