Fedex

• 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?

FedEx strategy for success in the marketplace is through customer intimacy and operational excellence. According to 10-K filing “FedEx continues to leverage and extend one of our greatest assets, the FedEx brand, and provide the customers with convenient, seamless access to the entire portfolio of integrated business solutions.” (FedEx, 2005) FedEx is using the operations of the organization as a means to create the best and unique customer experience.

• 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.

The four main business segments of FedEx are FedEx Express, FedEx Ground, FedEx Freight, and in 2004 FedEx acquired FedEx Kinko’s. (FedEx, 2005)

FedEx Express traceable fixed costs include salaries of managers and the prices of the products, costs that are not traceable is the increase in the amount of products used.

FedEx Ground traceable fixed costs are the employees’ salaries and the amount of product each employee sales.

FedEx Freight traceable fixed costs are the salaries of the pilots and the planes depreciation.

FedEx Kinko’s traceable fixed costs are the salaries of the employees and the depreciation the office equipment.

Cost that are not traceable to the four business segments are the salaries of employees who work for FedEx Corporate Headquarters, and the cost of the equipment used to run the corporation.

• Identify one example of a cost center, a profit center, and an investment center for FedEx.

An example of a cost center is the customer service department; an example of a profit center is the FedEx Kinko’s stores because...