Originally Posted by
heavycargo
I think the first step is to be honest about the current changing landscape. What use to be a duopoly is about to seriously change.
Technology and the ability to quickly deploy a massive army of individuals with cell phones to help in any city around the world has changed the way of doing business.
I don't think its coincidental that the press in Memphis is reporting seeing more and more Amazon vans driving around town delivering packages.
The long term problem with Fedex is at the end of the day it's just a logistics company with many arms. Fedex is feverishly trying to reinvent itself in the wake of the changing markets creating new solutions in terms of ecommerce and supply chain logistics. It just doesn't have the appeal that Amazon does in terms of reinventing itself into a preferred household name.
Imagine being a struggling company desperate for business and you have to make a choice who will provide your shipping needs. Fedex can get your packages from point A to B. Amazon will not only deliver your package they have the capability of plugging your business into the biggest online market place in the world they own, instantly changing the way you do business and drastically increasing your bottom line. What's the better solution? In the near future its no longer going to be good enough to just be a logistics company. At the moment I can't imagine Fedex creating an online market place that can compete with Amazon. Amazon has already won the hearts of its faithful customers it will soon earn the respect and loyalty of businesses.
Fedex needs a fresh infusion of talent which has the capability of thinking beyond it's myopic perspective and more along the lines of these internet giants. Instead they depend on their next protege Raj who is strapped with little breathing room.
I do think Amazon is going to increase the B2B shipping model. It will help offset their costs -- transporting higher yielding freight along side their low yielding parcels.
I think FedEx's IT department SUCKS! The website sucks. Tracking a package is still a difficult process. The app sucks too. It definitely isn't going to attract the millennial generation's or their kids attention.
I live in Memphis. Starting in the early morning I see two or three Amazon trucks in my neighborhood. And there are trucks delivering all day and into the night. *Rarely* do I see a FedEx truck. However, as Fred states, eCommerce is only 12% of our business. So home deliveries aren't a majority of the FedEx portfolio.
What do you reinvent FedEx into? You seem to believe that FedEx can't create a marketplace. I think FedEx can and must in order to survive Amazon's wrath. The incentive to go with FedEx's marketplace is that you keep your business data out of the prying eyes of Amazon. Amazon sees what you are selling and then undercuts you. You are damned if you do and damned if you don't. FedEx already has relationships with thousands of businesses which could prove useful in building the marketplace.
This FedEx bot IMO will be a huge fail. Perhaps it was a publicity stunt to keep the brand name in the news?
The problem with Amazon is that they're paying extremely low rates to transport those goods. They've already caused a couple of trucking companies to go out of business who signed onto their low paying contracts. This could be a benefit to UPS/FDX or what causes our yields to fall.