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Case Title:

FedEx in China: The Competitive Strategies

Publication Year : 2006

Authors: Shalini, Nafis Aziz, Souvik Dhar

Industry: Transportation

Region:China

Case Code: MES0024

Teaching Note: Not Available

Structured Assignment: Not Available

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Abstract:
In July 2005 Federal Express Corporation (FedEx) announced the closure of its Asian hub at Subic Bay, in the Philippines and the creation of its Asian hub at Guangzhou, in southern China. This new hub would provide FedEx with easy access to the Pearl Delta River, which is the manufacturing and economic centre of China. This proposal came at a time when China had signed a historic aviation deal with the US, that provided 11 weekly flights between the two countries. In addition, airfreight from China is expected to grow by 10% annually until around 2025. However, the high growth in the airfreight market in China has also attracted other major players like United Parcel Services (UPS) and DHL. FedEx also faces competition from the state-owned postal services, China Post, which is vying for a share of the airfreight market by revamping its overnight express and second day delivery services. Further still, despite China's entry into the World Trade Organisation in December 2001, China has some complex customs procedures. Inadequate transportation infrastructure is another major concern. The case study provides scope to discuss the market entry strategies of FedEx in China and the challenges faced by the company to grow and compete in China's complex business environment.

    Keywords : Federal Express Corporation (FedEx); China; Market entry strategy; Growth strategy; DHL; United Parcel Services (UPS); World Trade Organisation; Asia; Express-delivery companies; Airfreight market in Asia; China post

Contents : 
China’s Courier Service Industry
Foreign Parcel Companies Operating in China
Operating Services in Courier Service Companies
Total Market for Courier and Air Delivery Services in China
Express Leadership in China
Competitive Strategies of FedEx in China
FedEx’s Shipping Software

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