Fedex (FDX)

FedEx Corporation (FedEx), a company incorporated in 1997, is in the logistics and e-commerce business. Fedex offers its products and services under four subsidiary companies.

  1. FedEx Express
  2. FedEx Ground
  3. FedEx Freight
  4. FedEx Services.

Fedex generates revenue from the following sources:

  1. Transportation of goods.
  2. Domestic and International freight services.
  3. Shipping of goods purchased from e-commerce channels.
  4. Corporate and business services
  5. Specialized haulage services.

Products and Services

  1. FedEx Express Corporation

FedEx Express provides domestic and international shipping services and handles delivery of packages and freight on an expedited basis. As an express transportation company, FedEx Express offers its users in the US the FedEx First Overnight, FedEx Priority Overnight and FedEx Standard Overnight delivery services. Same day deliver for packages not more than  70 pounds in weight is also available to US customers via FedEx SameDay. to all destinations in the United States. Express overnight freight services are also provided in a time-definite fashion.

Customers abroad are served via the International express and deferred package delivery service. This service is available in more than 220 countries and comes with a money-back guarantee. The International Priority package and International Economy package services provide time-definite delivery within 3 or 5 business days respectively.

In providing these services, FedEx also works with retail outlets to provide drop-off services to consumers. FedEx Express also offers customs brokerage services, trade advisory services, global ocean and air freight forwarding. Through its FedEx Trade Networks service, FedEx Express also provides the Customs-Trade Partnership Against Terrorism (C-TPAT) program and publishes customs duty information for approximately 180 customs areas worldwide.

FedEx also offers supply chain solutions as well as critical inventory logistics, transportation management and temperature-regulated transportation services.

  1. FedEx Ground

FedEx Ground provides small-package ground delivery services for packages not exceeding 150 pounds in weight. FedEx Ground also provides consolidation and delivery of business-to-consumer packages in partnership with the United States Postal Service (USPS).

  1. FedEx Freight

FedEx Freight provides freight services and trucking services as well as time-specific freight-shipping services on an expedited basis in North America. Surface Expedite and Air Expedite are time-critical delivery services which are met by the Fedex Freight service.

  1. FedEx Services

This corporate services division of FedEx provides sales, marketing, IT, communications and back-office support as well as billings and collections services for its customers in the United States. A suite of services which are delivered via mobile devices, is also available in 220 countries and 26 languages. These apps can allow customers to print directly from their smartphones to any FedEx Office location in the United States.


Remarkable Facts About FedEx

FedEx has only lost a few of its operational aircraft, and indeed only once till date has a plane of this courier company crashed. This is one company known for its doggedness. At some point, stories have it that the company’s founder had to gamble his last $5,000 to raise about $27,000 which was able to pay company employees during a crisis period. The company has grown exponentially then and has been able to catch on with the e-commerce boom  to diversify its income base.

What Lies Ahead for Fedex Investors?

FedEx has benefited from the explosion in e-commerce services as well as the advent of the smartphones and tablet devices, which have enabled it to diversify its product offering from the traditional expedited delivery services.

FedEx is presently part of an ongoing move to save the debt-ridden United States Postal Service and for good reasons too. FedEx was the number one supplier of the USPS and earned close to $1.5bn in 2014. Most of this money has been made flying Priority and Express Mail for the USPS since 2000. These flights operate in the day time when the courier company’s own service is off the grid. Losing this contract would put pressure on Fedex’s revenues.

So while investors can revel in the ever-increasing use of courier companies for e-commerce deliveries, careful attention also needs to be paid to the domestic component of FedEx’s bottomlines viz-a-viz the USPS situation.