FedEx Services: Express, TNT Express, Ground, Freight & More - Essay Sample

Introduction

The products offered and services rendered by FedEx are diverse. They are best split into segments and include the following; FedEx Express, TNT Express, FedEx Ground, FedEx Freight, and FedEx Services. All of the aforementioned provides different product services, operate independently, but are managed as a whole under the FedEx umbrella.

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First, FedEx Express is ranked as the most significant express transportation in the world. Its services are efficiently delivered to over 220 different countries. Further, it interconnects consumer markets that amount to 99% of the GDP of the world. It works in unison with the FedEx Trade Networks that takes care of the international trade aspect of the business and the FedEx CrossBorder that facilitates global transactions between various consumers (Pratap, 2019).

Second, TNT Express is best known for the following; the speed with which the products are delivered, the distance covered, and the weight vis-à-vis the size of the products. Its targets are mostly significant business operations that operate on the international landscape. These businesses revolve around healthcare, high-technology, automotive industries, etc.

Third, the FedEx Ground offers delivery of small packages. It focuses more on demands that are of low-cost, and those that run on a day-to-day basis. It mostly operates in the United States, as well as in Canada. These deliveries in the U.S. are made via the FedEx Home Delivery Service. When it comes to the delivery of goods that do not consume much time and are high in volumes but low in weight, the shipments are made by FedEx SmartPost, which is a form of FedEx Ground service (Pratap, 2019).

Fourth, FedEx Freight offers “less-than-truckload” freight services over vast distances. It is subdivided into the following depending on urgency and costs; Freight Priority and Freight Economy. Freight Priority is utilized when the necessity with which the consumer needs the products delivered is critical. On the other hand, Freight Economy is used when a consumer is willing to minimize costs at the expense of time of delivery. It operates in Canada, Mexico, Puerto Rico, and the United States.

Fifth, FedEx Services seeks to provide the various aspect of efficient service delivery. Through multiple offices, the focus is mainly put on how sales are made, how different forms of marketing are employed, the IT aspect of the business, the nature of customer services, how effective the technical support system is, etc. through its offices, customers are privy to different forms of services offered by both the FedEx Express and the FedEx Ground Shipping Services (Pratap, 2019).

FedEx provides different types of services in the world. As has been determined, these services amount to its product strategy and can best be summarized into the following; shipping, managing, and tracking of shipments, as well as packaging and freighting.

To keep at par or ahead of its competition, FedEx employs a lot of creativity in its advertisements. These advertisements are designed in such a manner that they leave a long-lasting impression on its consumers or target audience. Further, they are featured on print media all year. They are also directly involved in various sporting events by offering sponsorship deals. In addition to that, FedEx has a policy on charity and seeks to help the community directly. Its further reliance on digital marketing is seen through its YouTube channel, through which constant updates regarding the company are made (Pratap, 2019).

External Situation Analysis

In a statement issued out by the FedEx company, they admitted to facing stiff competition in the market. In this business, there is intense competition and sensitivity to price vis-à-vis service delivery. While FedEx may be forced to raise its capital, some competitors are run by foreign governments, and this makes it simpler for them to source or raises money. Further, the presence of regional transportation that functions under smaller and lower financial demands does not make it any easier for them. They are facing enormous threats in the reduction of their revenues and shares in the market owing to the establishment of shippers that are capable of carrying out ground delivery. Competitors are threatening to provide various services that are already being provided by FedEx, thus making it difficult to have stability or growth in its market share (Bhasin, 2016).

In the U.S., some of the significant competitors include, but are not limited to, United Parcel Service, DHL, SNCF, Blue Dart, Kuehne+Nagel, etc. All FedEx competitors have targeted the most crucial element of its business; the courier services. As such, they have all established or are in the process of setting up their business in a similar manner in a bid to match the success experience by FedEx thus far.

While FedEx has been trying its best to maintain or improve the quality of the delivery of its services, it faces fierce competition from rising companies that have the more substantial financial muscle and support from the local governments. Further, these companies have disrupted the market by offering similar services at lower costs in an attempt to win over consumers.

The following PESTEL analysis best summarizes how the trends in the marketing environment may affect FedEx company (Pratap, 2019).

Governments, through their ever-increasing regulations, are having a direct effect on businesses, specifically those that are international. Aside from rules, stability in a countries’ government is fundamental to its economy. Economic instability negatively impacts businesses. FedEx can only thrive on a stable economy, and just like other international companies, it is governed by the rules and regulations of the markets within which it operates.

Economies are directly linked to businesses. Recessions in the economy have dire effects such as unemployment, inflation, and reduction of wages. On markets, theirs is bound to be a decrease in a company’s revenues. Businesses that rely on FedEx are directly affected by any economic influxes that may arise. This, in turn, would have a direct effect on FedEx income.

On the social spectrum, FedEx, through its commitment to community service, has garnered massive recognition and appreciation. With the rise of social media, the need to have a “perfect” image is crucial. It is, therefore, prudent for businesses to put in a lot of effort towards ensuring that they have a socially responsible image (Bhasin, 2016).

The importance of technology in the success of any business in the contemporary world cannot be understated. It is central to any business operation. To have an edge in the market, most, if not all, businesses are embracing the ever-changing technology. The substantial investment in technology by FedEx has had a direct impact on its efficiency in service delivery. It has made technology the center through which customer solutions are handled.

“FedEx joined the Blockchain in Transportation Alliance (BiTA) to explore this new technology within the logistics sector” (FEDEX ANNUAL REPORT, 2018).

The environmental aspects of businesses have to be considered, as well. It has been established that the loyalty portrayed by customers to a particular company is directly reliant on how environment-friendly the business is. Further, with the growing formation of stringent environment-protection measures by governments, the business must comply. Caring for the environment has immense advantages to the community, and by extent, the company itself. FedEx has set up facilities that are focused on the production of solar panels to reduce the use of non-renewable energy and dangerous emissions.

Compliance with the legal provisions of a state is crucial to any business. FedEx functions in an international spectrum and is therefore privy to the laws of multiple states. Compliance with these rules and regulations is, therefore, key. However, an increase in the demand for compliance results in an increase in the costs of operations. While it is essential to establish laws that curb unethical business practices, these laws are seen to interfere with the growth and functionality of businesses.

Marketing Mix

All the various FedEx companies employ specific tactics concerning the market which it serves. This specialization is significant since it utilizes the expertise and has the result of providing efficient and quality services to the consumers. This has made it easier to react to the ever-changing demands of consumers. With critical trends such as the spread of e-commerce, trade globalization, quicker and more efficiency in supply chains, etc., the demands from consumers have not only changed but have risen as well. The service delivery specialization by FedEx has been able to match these demands rather seamlessly (Bhasin, 2016). Further, continually expanding its bases has been crucial to its growth. To facilitate this expansion, FedEx took over one of its biggest competitions, TNT Express. Consequently, it grew immensely, not only in Europe but in the world. Further acquisitions with a similar purpose have been made in South Africa, Brazil, Poland, etc.

Looking for ways to promote the brand of FedEx is essential in its marketing strategy. It does so through advertising and sports sponsorship deals, as discussed above. Concerning its pricing, FedEx uses its Service Guide to let its consumers know of the prices for all the services it provides. Usually, these prices are flat rates based on several variables, such as the type of package, the type of service required, and how far the destination is.

The goal and target of FedEx are to ensure the conservation of the environment as it seeks to ensure more efficient and reliable service delivery. This is evident through the following set goals; to have a 30% reduction in the number of emissions from its aircraft by 2020, to have a 30% improvement in its locomotives’ efficiency, and to move towards utilization of green energy for fuel.

So far, FedEx has been able to improve the efficiency of its locomotives concerning its fuel consumption by 22%. Further, in its bid to move towards green energy sources of energy, FedEx has registered close to 18% increase in its electric vehicles worldwide. All its envelopes are now designed in a carbon-neutral manner and are shipped freely for its customers. The need to continually print out documents that leave the environment at risk has been reduced by the provision of the FedEx Electronic Trade Documents tool. It allows consumers to send their documents electronically.

References

Bhasin, H., (2016). Marketing mix of Fedex - Fedexmarketing mix. Retrieved December 20, 2017, from https://www.marketing91.com/marketing-mix-of-fedex/

FedEx Corporation Form 10-K for the FY 2017. (2017, July 17). Retrieved from http://s1.q4cdn.com/714383399/files/doc_financials/quarterly/2017/Q4/FY17-Form-10-K.pdf

Pratap, A. (2019, March 18). FEDEX PESTEL ANALYSIS. Retrieved June 23, 2020, from https://notesmatic.com/2018/10/fedex-pestel-analysis/