FedEx Corporation FedEx Company Overview FedEx Is

FedEx Corporation FedEx Company Overview FedEx is a global organization that provides wide variety of business portfolio such as e-commerce, transportation and business services. FedEx operates and competes effectively under collective brand names such as FedEx Express, FedEx Freight, FedEx Ground, and FedEx Kinko's. The objective of the paper is to provide comprehensive report on FedEx that include FedEx's strategy for success in the marketplace and the company four main business strategy. The report uses FedEx's Form 10-K fiscal year to answer the following 7 questions.

"What is FedEx's strategy for success in the marketplace? Does the company rely primarily on a customer intimacy, operations excellence, or product leadership customer value proposition? What evidence supports your conclusion?" Answer to FedEx strategy is by building a strong brand to enhance customer experience as well as enhancing capabilities of the company sales professional. The company relies on the combination of value proposition, customer intimacy, operational excellence and product leadership to achieve success in the market place.

The company relies on the advance information systems to achieve distinct competencies, and FedEx continues to offer faster delivery service as well as expanding their global network. By being the first company in the industry to offer door-to-door pick up service delivery to customers in North America, the company has built a distinctive competence for itself in the industry. The company strong performances at the end of the 2005 fiscal year are credited to method the company operates independently to focus on the distinct market needs.

FedEx has also based its decision on capital investment, information technology networks and service addition to achieve highest long-term capital returns. The company also offers automated and package tracking option using the barcode wireless for customers, and the company continues to rely on the new technology to expand into new market and optimize the earning. FedEx also relies on its efficiency by focusing on acquisition of small and medium companies. In 2004, FedEx acquired Parcel Direct, a leading parcel consolidator. Its acquisition with consolidation of U.S.

Postal Service has enabled FedEx to offer proven cost effective service for its customers while achieving distinct competitive advantages in the industry. Question 2: "What are FedEx's four main business segments? Provide two examples of traceable fixed costs for each of FedEx's four business segments. Provide two examples of common costs that are not traceable to the four business segments." Answer to Question 2 FedEx operates under four distinct four business segments that include FedEx Express, FedEx Ground, FedEx Freight and FedEx Kinko's.

The company derives its largest revenue from FedEx Express and Ground divisions that provide parcel and small package delivery service in the U.S. And globally. FedEx Freight specializes on inter-regional truck load and freight service while FedEx Kinko's provides business services and document solution for customers. Two examples of traceable fixed costs for each of the FedEx segment are as follows: FedEx Express: Salary of product manager is an example of traceable fixed costs. Depreciation of the company transportation fleet is another example of traceable fixed cost.

FedEx Ground: Salaries of the sale personnel dedicating for supply solution and the company advertising expenses are the examples of traceable fixed costs. FedEx Freight: Salaries of the fleet pilots and depreciation of the company freight fleets are the examples of traceable fixed costs. FedEx Kinko's: Salaries of the personnel of the segment and depreciation of the printing equipment are the examples of the traceable fixed costs.

Two examples of common costs not traceable to the four segments are the salary of the Chief Executive Office (CEO) and the salary of Chief Financial Officer because no FedEx segment could be solely traceable to this cost. (Noreen, Brewer and Garrison, 2011). Question 3: "Identify one example of a cost center, a profit center, and an investment center for FedEx." Answer to Question 3 FedEx Information Technology department is an example of the company cost center.

An example of a profit center is the FedEx Express global network office, and an example of the investment center is the corporate headquarter of FedEx Corporation. Question 4: "Provide three examples of fixed costs that can be traceable or common depending on how FedEx defines its business segments." Answer to Question 4 Salaries of FedEx Call Center Personnel: Salary of call center personnel is an example of a fixed cost that could be traceable to a company business segment.

Salary call center personnel could be common if each of the service of the segment computes salary of call center personnel. Landing Fees for the Company Airline: The landing fee is fixed costs traceable to the flight and the cost could be common if FedEx decides to break its FedEx Express segment into next day, second day as well as inter-regional segment. Costs of Fleet Maintenance: This could be traceable to the company business activities.

However, the cost is common to FedEx business segment by sharing the same cost of fleet maintenance. Question 5: "Compute the margin, turnover, and return on investment (ROI) in 2005 for each of FedEx's four business segments (Hint: page 99 reports total segment assets for each business segment." Answer to Question 5 Formula to calculate the profit margin, asset turnover, and return on investment is as follows: Profit margin = net income/sales Asset turnover = sales/total asset Return on investment (ROI) = net income/total assets.

Alternatively ROI could be calculated as follows: Profit margin x Asset turnover Segments Revenues Operating Income Assets Turnover Margin Return on Investment (ROI) FedEx Express $19,845 $1,414 $13,130 1.51 7.13% 10.77% FedEx Ground $4,680 $604 $2,776 1.69 12.91% 21.76% FedEx Freight $3,217 $354.