Part 2: SWOT Analysis

Jeff Schmid, Laura Sefchick, Chelsea Smith, Chelsey Starson, Paul Stroncek, Joe Tanner.  

Background

Founded in 1985 as RPS; rebranded as FedEx Ground in 2000.

Specializes in cost-effective, small-package shipping, offering dependable business-to-business delivery or convenient residential service through FedEx Home Delivery and FedEx SmartPost.

Headquarters is here in Pittsburgh, Pa which increases job rates and stimulates the local economy.

Workforce: More than 67,000 team members

Ground Fleet: More than 22,000 motorized vehicles

Daily Average: More than 3.5 million packages

Services all throughout the United States and Canada.

Operating Facilities: 32 ground hubs and over 500 pickup/delivery stations. 25 FedEx SmartPost distribution centers

Dropoff Locations: 674 FedEx World Service Centers1,783 FedEx Office locations6,732 FedEx Authorized

ShipCenters® and Alliance Partners

FedEx Ground: U.S.Provides 100-percent coverage to every business address in the United States, with small-package delivery in one to five business days in the continental U.S. and in three to seven business days to Alaska and Hawaii.

FedEx Ground: InternationalProvides 100-percent coverage to every business address in Canada, with small-package delivery in 2 to 7 days.

FedEx Home DeliveryDedicated to residential customers, serves virtually 100 percent of the U.S. population. This residential-only network provides guaranteed delivery options of delivery in evenings, on Saturdays and even by appointment.

http://news.van.fedex.com/fedexgroundoverview

Fast. Reliable. FedEx Ground®.

FedEx Ground is faster to more locations than UPS Ground.

Improved transit times for more than half of the city-to-city shipping lanes so that shipments can be delivered sooner, be more competitive, and improve customer satisfaction and save money.

http://www.fedex.com/us/fedex/shippingservices/package/ground.html

FedEx Ground is: Economical - With the most cost- effective rates for

ground shipping. Comprehensive - We offer delivery to every address

in the 48 contiguous U.S. states within 1 to 5 business days based on the distance to the destination (delivery to Alaska and Hawaii in 3 to 7 business days).

Easy to track - Options for tracking the status of your shipments.

Reliable - FedEx Ground service in the U.S. is supported by a money-back guarantee.

* If your package does not arrive by the end of the scheduled delivery day, FedEx Ground will credit or refund the shipping charges.

http://fedex.com/grd/maps/MapEntry.do

Target Market-Research

FedEx as a whole is extremely dedicated to its customers. They strive to have superb customer service;

they push this first and foremost with their employees.

Since FedEx Ground specializes in the shipping of small packages, our target market will be the residential customers.

http://about.fedex.designcdt.com/our_company/company_information/fedex_ground

With FedEx Ground Multiweight® you can enjoy pricing based on the combined weight of packages being shipped in the same day to same location or at least 150 lbs, which is convenient and cost-effective.

FedEx Ground also enables customers to pay for shipments, bill the recipients or a third party or pay for all inbound shipments using FedEx Ground® COLLECT

Service Details  FedEx Ground Multiweight®: bulk ground shipments

Service Description Ideal for multiple-package shipments weighing 200 lbs. or more moving as one unit to the same destination on the same day. This pricing option allows you to combine packages for a multiweight rate. Pricing is based on the combined weight of your packages.

Delivery Times Door-to-door delivery in 1–5 business days, depending on distance to the destination.Delivery to Alaska and Hawaii in 3–7 business days.

Service Days Monday–Friday.

Delivery Area Available throughout all 50 states.

Package Size and Weight Multiple-piece shipments with a total weight of 200 lbs. or more can qualify.Average package weight should be 15–25 lbs.Up to 150 lbs. per package, 108" in length, 165" in length plus girth (L+2W+2H).

Additional Information Service includes inside delivery and up to three delivery attempts.Shrinkwrapping or palletizing shipments is not required.Packages are processed like any other FedEx Ground® shipment.Contract pricing is required.

How to Use To see if you qualify, contact your FedEx account executive.

FedEx Network FedEx Ground

http://www.fedex.com/us/fedex/shippingservices/package/ground.html

Geographics Adults in Western Pennsylvania Focusing on metropolitan areas, especially Pittsburgh. Since FedEx Ground originated near Pittsburgh, they have a

special bond with the city. They have also helped out in different ways: In 2009, when the Steelers were going to the Super Bowl, FedEx

Ground collected Terrible Towels at the rally to send to troops overseas.

FedEx Ground also donated $5,000 to the Children’s Hospital of Pittsburgh.

Around the same time, they also donated $250,000 to local children’s hospitals around the country in recognition of the FedEx Air & Ground NFL Players of the Week Award winners. They chose these winners by noticing who represents the same

speed, precision and teamwork that their customers have come to expect from all aspects of FedEx.

Suburbs of Pittsburgh, as well as densely populated residential areas, would be where our marketing needs to hit.

Demographics

Our target market will be adults between the ages of 30 and 60, our main focus being on Generation X (those born between the years of 1964 and 1979.)

Both men and women Household Income of $30K to $130K

annually College Graduates Established, or plan to establish, families

Psychographics

Many of those in Generation X are busy, career-driven individuals who are settled down.

They tend to look for good service along with convenience and efficiency.

Our target market is social Our target market is motivated, both in their

family lives and their careers. They are responsible, and search for the best

things within their reach. They want the best for both their family and

themselves.http://60secondmarketer.com/blog/2010/07/12/how-to-use-the-magazine-rack-test-to-get-a-psychographic-profile-of-your-customer/

Behavioral Our target market is sociable and enjoys communicating. And

even though social media is their growing source of communication with friends and family, they still need shipping services when sending packages. They will stay away from places that present them with poor services. If we don’t already have their brand loyalty, this gives us the opportunity

to leave them with a great impression; also, it allows them to keep us as their primary shipping company.

When they are satisfied with a service or good, they will continue to return until they have a reason not to.

Although they want good service, they usually won’t pay more than they have to in order to get it.

They ship packages to loved ones in different states and countries.

They also ship gifts to those that they may not be able to see often.

They have packages delivered to them through online shipping. They also work for companies that require shipping services.

http://www.helium.com/items/1904257-find-customers-based-on-demographics-and-psychographics

Product Value Proposition

Definition: the benefit the customer will receive if and/or when they buy or use your product.

All specific value propositions derive from just 4 root types of value proposition:    1. Our product is unique    2. We have the lowest prices    3. We make things easier for you    4. We take ownership of a problem

http://www.expertprogrammanagement.com/2011/02/value-proposition-examples/

FedEx uses the root of "we make things easier for you."

FedEx has the value proposition that it doesn’t just offer fast delivery; it offers guaranteed delivery by a specific time.

This guarantee makes life much easier for its customers by letting them know the exact day and time that they will be able to receive their package.

http://www.expertprogrammanagement.com/2011/02/value-proposition-examples/

What is a SWOT analysis?

SWOT is the acronym for Strengths, Weaknesses, Opportunities and Threats. It is a 4-box model used to show the risk and opportunities for any company across the value chain. It is easy to use and looks into the internal and external factors of an issue of the company.

FedEx Ground SWOT

Strengths:

•World-wide service•FedEx Office Stores•Name recognition•Experts in logistics

Weaknesses:

•Slow Rural Deliveries•Fewer store locations in rural areas•Website hard to navigate

Opportunities:

•More internet buyers •More internet shippers

Threats:

•UPS•USPS•Freight carriers

http://www.wikiswot.com/swot.htm

Service Map

This map shows the service

schedules in business days as of January, 2011 for

FedEx Ground shipments.

http://fedex.com/grd/maps/MapEntry.do

Weight Zone 2 Zone 3 Zone 4 Zone 5 Zone 6 Zone 7 Zone 8

Letter n/a n/a n/a n/a n/a n/a n/a

1 lb. 5.17% 5.40% 5.51% 5.75% 6.04% 6.12% 6.22%

2 lb. 5.37% 5.72% 6.22% 6.34% 6.75% 6.89% 7.13%

3 lb. 5.45% 5.97% 6.53% 6.73% 7.15% 7.36% 7.88%

4 lb. 5.58% 6.16% 6.86% 7.17% 7.53% 7.85% 8.44%

5 lb. 5.79% 6.25% 7.15% 7.46% 7.83% 8.20% 8.91%

10 lb. 6.86% 7.05% 7.87% 8.40% 9.00% 10.17% 11.28%

20 lb. 8.39% 9.42% 9.89% 11.37% 14.15% 16.70% 19.21%

25 lb. 9.35% 10.86% 11.57% 13.56% 17.09% 20.02% 23.42%

30 lb. 10.45% 12.16% 13.36% 15.68% 20.06% 23.23% 27.59%

40 lb. 12.12% 14.89% 16.77% 20.06% 25.66% 29.80% 34.99%

50 lb. 13.67% 17.12% 19.82% 24.15% 30.07% 36.24% 41.04%

60 lb. 15.10% 18.92% 21.96% 27.37% 33.58% 39.76% 46.40%

70 lb. 16.39% 20.86% 24.20% 29.35% 35.98% 41.96% 48.95%

80 lb. 23.59% 27.14% 29.39% 34.21% 41.12% 47.10% 50.71%

90 lb. 31.64% 33.50% 35.92% 40.30% 46.76% 52.43% 55.79%

100 lb. 39.32% 39.95% 42.59% 46.28% 51.90% 57.38% 61.78%

115 lb. 48.10% 48.91% 50.78% 54.05% 59.55% 65.35% 70.80%

120 lb. 50.99% 51.54% 53.49% 56.57% 62.06% 67.99% 74.05%

130 lb. 56.10% 56.94% 59.04% 61.65% 67.07% 73.23% 79.92%

140 lb. 61.32% 62.63% 64.88% 66.98% 72.42% 78.61% 86.24%

150 lb. 65.83% 68.62% 71.61% 74.32% 78.02% 84.09% 92.60%

Rates shown are not inclusive of any surcharges or accessorial fees (ie. Fuel surcharge, residential surcharge, delivery area surcharge, etc.) Carrier

rates are based upon current published UPS and FedEx rate schedules.

The Internet has helped to increase customer base and FedEx illustrates the value of being able to use the Internet for domestic and international business.

The FedEx site has great brand action by being user friendly and catering to the user needs. 

This site would also be one that has integrated with both B2B and B2C by satisfying the needs of individual consumers along with other businesses.

FedEx on the Internet

Business Challenge

“With customer expectations for timely delivery rising, and its own processes ever-

more dependent on data, FedEx Ground needed to ensure that its business systems

were fast, reliable and flexible. FedEx Ground’s systems needed to meet ever-increasing processing demands —both

nearterm and long-term—while at the same time supporting a business model based on

speed, efficiency and low cost.”

http://www-07.ibm.com/systems/includes/content/optimiseit/pdf/fedex_ground.pdf

Solution

FedEx Ground deployed the IBMSystem i as the foundation of itsoperations. With industry-leading

flexibility and resiliency, the System isolution has been a key enabler of the

company’s ongoing transformationefforts affecting all of its package

delivery processes.

Key Benefits

Flexible resource allocation andnimble capacity growth with the

System i's virtualizationCapabilities

Increased system availability,ensuring greater reliability for day

to day operations

Business Benefits Flexible resource allocation and nimble

capacity growth with the System i'svirtualization capabilities

Increased system availability, ensuringgreater reliability for day to day

Operations

High levels of integration speed forapplication development, enabling

faster rollout of new capabilities

Low TCO with the System i's ease ofmanagement and flexibility

Pricing

Being a private company they have total freedom from the government in determining their prices unlike USPS.

Need to keep prices low to compete with UPS.

Other variables taking into account are price of gas, weather conditions, its destination, how far the package must travel, and the weight.

Pricing of Businesses

FedEx has a special team of salesman that go business to business to talk about shipping needs, if any are needed.

If a business has shipping needs FedEx will talk to owners about what they can do to resolve all of their shipping needs.

If a business makes shipments on a consistent basis, FedEx will apply discounts and maybe even cut shipping charges by some degree.

Pricing and Competition

FedEx and UPS fight for business every day. FedEx must do whatever it can to keep prices low and be as accurate as possible with deliveries.

FedEx has to keep in mind for pricing is whether or not UPS is increasing or decreasing prices as well.

In order to stay ahead of UPS, FedEx must watch all of UPS’s decisions and set prices accordantly.

Campaigns and Promotion

July 20, 2007 – Employees lent some muscle at the Pittsburgh

Blues Festival, which benefits the Greater Pittsburgh Community Food Bank. By the end of the night, FedEx volunteers loaded three trucks with more than 24,000 pounds of food.

http://news.van.fedex.com/node/3883

December 19, 2006- The support of local Pittsburgh sports

celebrities and ten FedEx volunteers, more than 500 toys were donated to the Children’s Hospital of Pittsburgh

October 17, 2006- Hundreds of FedEx employees in the Pittsburgh area

volunteered their time as part of the company’s second annual FedEx Cares Week.  Working with the Woodlands Foundation, volunteers donated their time and energy to deliver new mattresses, refurbish counselor dorms and clear land -- continuing the company’s commitment to work collaboratively to make a difference in the communities in which we live and work every day.

July 30, 2009- Announced plans to install the nation’s largest

rooftop solar-electric system at its distribution hub in Woodbridge, N.J.

Friday February 18, 2011- FedEx Ground has selected a 52-acre site in

Norcross, Ga., to build a new distribution center that will complement the operations of three existing facilities in the Atlanta area.

This article shows them building other centers to expand. This expansion leads to even more faster service.

Showing what & how FedEx has supported the local area is a way of promoting FedEx Ground for Pittsburghers; this is to further support a company that helps supporting others. 

http://markets.financialcontent.com/stocks/news/read?GUID=17287891#