FedEx VALUE CREATION AND ECONOMIC PROFIT United Parcel Service
MEIHO UNIVERSITY
CASE STUDY FOR FINANCIAL MANAGEMENT
CASE 4:
The Battle for Value, 2004:
FedEx Corp. vs. United Parcel Service, Inc.
VALUE CREATION AND ECONOMIC PROFIT
Lecture: 鍾 紹 熙 老 師 Group 3: F49802134 胡 秋 草 F49802153 高 玉 享 箮 Presentation date: 16th Apr 2012
I. OUTLOOK OF CASE 4
Case 4 mentions about the competition between two leading companies in package- delivery market. FedEx which is the largest foreign presence in China, with 11 weekly flights, serving 220 Chinese cities, so the company’s volumes in China had grown by more than 50% between 2003 and 2004. UPS which is the world’s largest package-delivery company and dominant parcel carrier in US, serving 200 cities in 2003. FedEx had virtually invented customer logistical management, and was widely perceived as innovative. Historically, UPS had reputation for being big, bureaucratic and an industry follower.
Two companies have their own market, an individual characteristics, and inconclusive. Thus, not only based on the development and operation of the two companies, the analysis also relied on the special purpose financial ratios ( especially Economic Value Added (EVA), an effective measure and rapid for firm within an industry) to find which company has more competitive advantage.
II. INTRODUCTION
1. FedEx corporation: FedEx, formally known as Federal Express, started delivering packages and freight on April 17, 1973. The company was founded by Frederick W. Smith, a Yale University graduate. Federal Express offered overnight and second-day delivery to 25 cities in the United States. The company started in Memphis, Tennessee, and it is still in that location today. FedEx didn’t actually start showing a profit until July 1975. FedEx starting going international in the 1980s after the company purchased Tiger International and carriers in Japan and Italy. In 1989 FedEx became the first U.S. express carrier to offer direct flights to China.
CASE STUDY FOR FINANCIAL MANAGEMENT
CASE 4:
The Battle for Value, 2004:
FedEx Corp. vs. United Parcel Service, Inc.
VALUE CREATION AND ECONOMIC PROFIT
Lecture: 鍾 紹 熙 老 師 Group 3: F49802134 胡 秋 草 F49802153 高 玉 享 箮 Presentation date: 16th Apr 2012
I. OUTLOOK OF CASE 4
Case 4 mentions about the competition between two leading companies in package- delivery market. FedEx which is the largest foreign presence in China, with 11 weekly flights, serving 220 Chinese cities, so the company’s volumes in China had grown by more than 50% between 2003 and 2004. UPS which is the world’s largest package-delivery company and dominant parcel carrier in US, serving 200 cities in 2003. FedEx had virtually invented customer logistical management, and was widely perceived as innovative. Historically, UPS had reputation for being big, bureaucratic and an industry follower.
Two companies have their own market, an individual characteristics, and inconclusive. Thus, not only based on the development and operation of the two companies, the analysis also relied on the special purpose financial ratios ( especially Economic Value Added (EVA), an effective measure and rapid for firm within an industry) to find which company has more competitive advantage.
II. INTRODUCTION
1. FedEx corporation: FedEx, formally known as Federal Express, started delivering packages and freight on April 17, 1973. The company was founded by Frederick W. Smith, a Yale University graduate. Federal Express offered overnight and second-day delivery to 25 cities in the United States. The company started in Memphis, Tennessee, and it is still in that location today. FedEx didn’t actually start showing a profit until July 1975. FedEx starting going international in the 1980s after the company purchased Tiger International and carriers in Japan and Italy. In 1989 FedEx became the first U.S. express carrier to offer direct flights to China.
References: 1. Robert Bruner, Case Studies in Finance, 6th edition, McGRAW-HILL International Edition. 2. http://www.fastcompany.com/1716317/fedex-vs-ups-by-the-numbers. 3. http://vi.wikipedia.org/wiki/FedEx