SOWT Analysis on Federal Express Corporation

SOWT Analysis on Federal Express Corporation

Introduction

The acronym of SWOT stands for strength, weakness, opportunity and threat (Dealtry, 1992). It is a tool to analyze the strong and the weak points of the company and also understand the opportunities that are available for the organization to be better. This also signifies the probable threat that a company might face (Bohm, 2009). Thus, it does not only cover the internal affairs of the business but also highlights the external factors that may affect the performance of the business.

This report has applied SWOT analysis on Federal Express Corporation, to have a better understanding of the corporation.

Federal Express Corporation (FedEx) provides its services worldwide and has a big market share in the industry. It has a broad portfolio and the services that it offers include different shipping services, freight, transportation and business services. It operates in four major segments that are FedEx Express, FedEx Services, FedEx Ground and FedEx Freight.

Discussion

Organization History

Fredrick Smith, in 1971, established FDX which was later transformed into Fed Ex. In 1973, the operations in company started. By 1978, it was included in the New York Stock Exchange list. The company installed centralized computer system that helped in managing work on correct time basis. Gradually the company started expanding and by 1981, company was able to embark its first international services in Canada. This was a step towards international services. After three years, Gelco Express was acquired by the company resulting in an expansion of the business and leading them to launch their express operations in Asia Pacific and Europe. In 2000, FDX Corporation's name changed as FedEx and was growing its operations rapidly.

The mission statement of FedEx is to generate financial returns for its shareholders as high quality transportation, logistics and information services will be provided. Customer satisfactions will be given the priority and it will develop rewarding relationship with its stakeholder. Ethical and professional standards will be maintained at all times(fedex.com).

SWOT Analysis

Below is the SWOT analysis of FedEx Corporation

Strength

Strong Brand image

FedEx is quite popular in its brand imaging. It is one of the most distinguished names in worldwide express delivery services. In 2012, Fortune magazine ranked FedEx on number six for “World's most admired Companies” list.

Under the FedEx brand name the company operates under four segments. It promotes it brands through advertising, be it print or digital. It also provides corporate sponsorship as well as also promotes through special events. It spends a huge amount on promotion and advertising in 2012 they spent $421 million as compared to 2010 in which they spent $375 million.

FedEx brand image is strong and this is what drives it retail business and domestic revenues, and also aids in international expansion too.

Strong financial performance

Over the past few years the company was observed to performing financially strong. The revenues of the company increased. In FY2012 they were$42,680 million from $34,734 million in FY2010, thus increasing at the compound annual growth rate (CAGR) of 10.8%. Likewise, FedEx's operating and net profits ...