In a bid to lend support to Small and Medium Business (SMB) enterprises, FedEx Corporation (FDX) has introduced a new service called FedEx Office Business Edge. The new service is primarily a web page that provides useful information to small clients to successfully set up their business.
The new Office Business Edge service will help SMB clients in a number of ways by offering posters, signs and banners at a cheap rate. Moreover, through this service, SMB customers can dispatch goods, as well as postcards and letters at a reduced rate. Furthermore, it also rents fax and scan machines and desktop computers to these customers at a very nominal rate. Overall, the new service offers a complete office solution package to their SMB clients, thereby generating savings of up to 30% for each client. In order to motivate other SMB clients, it will also publish articles on successful business ventures on their web portal.
Recently, it has been noted that large business organizations are seeing their revenues stagnate due to stiff competition and also because of the fact that most companies have already reached a level of maturity. So only the upgradation of SMB units will create more opportunities for FedEx to grow in the near future.
Currently, FedEx has plans to invest $4.2 billion in fiscal 2012 and $3.8 billion in fiscal 2013 as against $3.4 billion in 2011 in order to increase the number of fleets. About 60% of the fiscal 2012 investments are targeted at long-term growth projects, including the expansion of FedEx Express' Asian and European networks, FedEx Ground's network, and equipment modernization at FedEx Freight. We believe the investment will lead to greater operational efficiencies, provide a competitive edge, generate significant long-term savings, support international growth, and drive higher earnings, margins and returns. Moreover, it will help them to combat competition from other transportation companies like United Parcel Service, Inc. (UPS) and Expeditors International of Washington Inc. (EXPD).
Currently, FedEx Corporation has a Zacks #3 Rank, implying a short-term Hold rating on the stock.
Based in Memphis, Tennessee, FedEx Corporationis the leader in global express delivery services. The company provides a broad portfolio of transportation, e-commerce and business service solutions.Read the Full Research Report on UPS
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