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Is the grass really greener?
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<blockquote data-quote="hoser" data-source="post: 185244" data-attributes="member: 6357"><p>if you bought stock for $70 7 years ago and you sell it today at $70, you would actually be making money. The profit is whatever the hell inflation was <img src="/community/styles/default/xenforo/smilies/tongue.png" class="smilie" loading="lazy" alt=":p" title="Stick Out Tongue :p" data-shortname=":p" /></p><p></p><p></p><p>fedex has been so great because the business model has focused on specialization. do air freight, air freight, and only air freight. ok, do trade solutions, ground freight, and critical, and some supply chain, those are profitable, startup costs are low (especially if you buy the competition out), and yields are pretty high. and you may as well carry fedex's brand reputation over to those segments. there's no point why not.</p><p></p><p>now they go into ground, and they're realizing that ground is not profitable, and you can't apply the same HR principle to ground as you did to air. ground is physically demanding, and the only people that will do it for that rate of pay are either student whores or people with no social skills, while fx express hires purely on attitude and character, because the jobs are so un-demanding. turnover is huge in ground because the pay sucks. labor is always your number one cost, and that's going to go up when your work force gets unionized. it'll happen eventually. ground yields are tight enough as they are without a unionized work force under you.</p><p></p><p>because fx decided to go after ground market share, this has done nothing but give UPS the opportunity to attack fx's air market share. and ups' market share in air is growing hugely because of that. as a upser, i'm happy, because air is where the profit lays. people needing billion dollar documents to get there next day by 9, not the printer sending 50*30lb boxes of wal-mart flyers advertising $0.08 cents off haynes t-shirts that can get there whenever.</p><p></p><p>ups is in an advantage for the long term because the business model is solid: efficiency. everything's under one roof, so this makes ups' efficiency in comparison to fx go way up. yeah, corporate culture sucks, managers are dicks, but the pay is good, and ups is sticking to their model. fx will have many more challenges ahead.</p><p></p><p>i think fred should have done what southwest airlines did: focus on what you do best and stay with it. i'm not going to do what 75% of the members on here do and predict a doomsday situation where fedex will shut its operation down by end of FY07, but i will say that fedex would have been better off committing to their bread and butter: air express, not acquiring massive ground networks that are costly, have low yield, and do nothing but fragment the operation of the company.</p></blockquote><p></p>
[QUOTE="hoser, post: 185244, member: 6357"] if you bought stock for $70 7 years ago and you sell it today at $70, you would actually be making money. The profit is whatever the hell inflation was :p fedex has been so great because the business model has focused on specialization. do air freight, air freight, and only air freight. ok, do trade solutions, ground freight, and critical, and some supply chain, those are profitable, startup costs are low (especially if you buy the competition out), and yields are pretty high. and you may as well carry fedex's brand reputation over to those segments. there's no point why not. now they go into ground, and they're realizing that ground is not profitable, and you can't apply the same HR principle to ground as you did to air. ground is physically demanding, and the only people that will do it for that rate of pay are either student whores or people with no social skills, while fx express hires purely on attitude and character, because the jobs are so un-demanding. turnover is huge in ground because the pay sucks. labor is always your number one cost, and that's going to go up when your work force gets unionized. it'll happen eventually. ground yields are tight enough as they are without a unionized work force under you. because fx decided to go after ground market share, this has done nothing but give UPS the opportunity to attack fx's air market share. and ups' market share in air is growing hugely because of that. as a upser, i'm happy, because air is where the profit lays. people needing billion dollar documents to get there next day by 9, not the printer sending 50*30lb boxes of wal-mart flyers advertising $0.08 cents off haynes t-shirts that can get there whenever. ups is in an advantage for the long term because the business model is solid: efficiency. everything's under one roof, so this makes ups' efficiency in comparison to fx go way up. yeah, corporate culture sucks, managers are dicks, but the pay is good, and ups is sticking to their model. fx will have many more challenges ahead. i think fred should have done what southwest airlines did: focus on what you do best and stay with it. i'm not going to do what 75% of the members on here do and predict a doomsday situation where fedex will shut its operation down by end of FY07, but i will say that fedex would have been better off committing to their bread and butter: air express, not acquiring massive ground networks that are costly, have low yield, and do nothing but fragment the operation of the company. [/QUOTE]
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