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Fedex on Living to Deliver

Fedex on Living to Deliver

by Heather Briden, Director

deliver

Next day and express delivery is an important part of every business, be it dispatching crucial packages to clients on the other side of the world, or simply ensuring that your employees get important documents on time.

However, more often than not, once the package is picked up we barely give it a second thought, confident that it will get to its destination on time. No thought is given to the massive behind-the-scenes operation that goes with transporting packages around the world or the masses of man-power and vehicles that these companies use.
And they don’t come much bigger than FedEx.

With more than 280,000 employees worldwide, an aircraft fleet of over 650, more than 80,000 other assorted vehicles and an annual revenue of $35 billion, FedEx has come a long way since it was founded in 1973 with 14 small air-crafts delivering 186 packages.

Ground-breakers

Actually made up of several different companies such as FedEx Express, FedEx Ground, FedEx Freight, FedEx Services and FedEx Office, FedEx shorten its name to its familiar moniker from Federal Express in 1994 after years of customers calling it by its abbreviation.

Based in Memphis, Tennessee, the company is headed by FedEx Express which is estimated to handle more than 3.2 million packages daily. FedEx Ground however ships more than 2.6 million packages a day.

That’s over 4 million packages being moved around the world per day. The logistics of such a global operation are simply mind-boggling, however using their ‘hub and spoke’ system FedEx are able to deal with much more than their original 186 packages.

In this system, all packages are flown to a central hub, sorted, loaded and dispatched. FedEx was the first company to devise this method and also the first to have its own carrier, planes, crews and ground fleets. With such resources, it’s no great surprise that they were also the first to implement next day delivery after 10.30am in 1982 as well as equip delivery vans with technology to track packages.

In fact, FedEX  were the first to do a lot of things; they had the first over the phone and real time package tracking in 1981, they were the first to offer time definite service for freight, they were the first with Saturday delivery and they were the first company to reach $1 billion in revenue within 10 years of starting up.

Of course, it can be expected that FedEx made ground-breaking achievements in the field of package delivery, it is surprising to learn that they were the first company to launch a television ad.

Watch: Tom Schmitt, President and CEO, FedEx Global Supply Chain Services on How to optimize innovation for bottom line results.

Diverse sponsorshipFedEx’s success has enabled them to become prevalent sponsors as well. In 2007, the company became the title sponsor of the FedEx Cup, a trophy in the PGA Tour. They are also current sponsors of the Formula One McLaren team, with both Lewis Hamilton and Jenson Button driving their cars. Previously, they’ve sponsored Ferrari, Benetton (now Renault) and Williams F1.However, it’s not just sports. The company is the 21st largest campaign contributor in the United States., donating over $21 million since 1990 (45 percent to Democrats and 55 percent to Republicans).Then there’s involvement in movies – FedEx famously featured heavily in the film Castaway where Tom Hanks stared as a FedEx employee stranded on an island after a plane crash. Despite the heavy use of the FedEx brand in the film, the company reportedly paid nothing for product placement in the movie, however FedEx CEO Fred Smith did make an appearance as himself in the film when the studio filmed on location at FedEx’s home facilities in Memphis, Tennessee.At the time, Smith did admit that the idea of a story based on a FedEx plane crashing gave the company “a heart attack at first,” but the overall story was seen as positive and the company saw an increase in brand awareness in Asia and Europe following the movie’s release.However as their ad campaign says, the company’s primary focus is “Living to Deliver” and their success is unparalleled with their 2008 revenue stopping just short of $38 billion. Of course, a company that delivers everything from windmills to sharks is unlikely to think small.

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Strategy

Heather Briden, Director