Fedex Macroenvironment Study

Cultural Environment

The cultural environment is made up of institutions and other forces that affect society basic values, perceptions, preferences and behaviors.

The internet and World Wide Web are extremely well suited for conducting business electronically on a global basic, Web-based Electronic Commerce(EC) has introduced unprecedented opportunities for the marketing of products and services, accompanied by features, functionality and innovative methods to serve and support consumers. E-commerce has became a major catalyst of the economy and remains a vital growth engine for businesses today, It successful change the consumer behavior. Consumer purchases over the Internet continue to grow from year to year. The survey involving interviews with 42,238 people in 37 countries worldwide revealed that almost a quarter of internet users have shopped online and 15% plan to do so during the next six month. This represents an opportunity for FedEx as a provider of small-package delivery service.

Besides that, in this competitive society, time is important to everyone. People are increasingly using the internet as a time-saving resource. People engage in numerous activities online, such as e-mail, planning trips, online banking and online research for their good purchases, all of which are easily completed online. FedEx can satisfy the consumer requirement of convenience with its sophisticated online service.

In addition to the change in behavior of consumer, many companies or retailers change the sales channel combinations. The greatest impact of the Web-bases electronic revolution has occurred in companies adopting the click-and-mortar approach. Click- and-mortar is one the strategy used by the companies or retailers that they continue to conduct their business in the physical locations and have added the electronic commerce component to their business activities. According to one study, 37% of United States retailers are selling through a combination of the internet, in stores and catalogs. This represents a growing demand for the business-to-customer package delivery service.

Besides to the dramatic change of internet to the consumer purchasing pattern and retailer selling pattern, the consumer today have become less tolerant of service failures and likely to expect better services that are more than the average. In addition to this, the consumer demands more for personalized service. It can be a difficult task for FedEx to satisfy all customer needs.

Economic Environment

The economic environment consists of factors that affect consumer purchasing power and spending pattern.

Nowadays, Globalization is a main trend for the world economic. The world’s economy has become fully integrated. There are no barriers and borders to trade around the world. FedEx divided the world on five regions: United States, Canada, Europe-middle East and Africa, Latin American Caribbean. It is easier for FedEx to operate its global business in a more efficient manner by realize and understand the different condition in various regions.

As a United States company, the economic condition of United States has tremendously affected the performance of FedEx. Although the U.S. economy has been seen sluggish, there is a continuing recovery in the United States economy. The United States economy grew at an annual rate of about 2.2% during 2007. There is also a steady growth in U.S. gross domestic product (GDP). According to the statistic, the United States GDP has increased about 0.9% in the first quarter of 2008. In addition to this, recently, the spending of consumer in United States rises about 2.5% per year. Besides that, the unemployment rate is falling since 2003. The current unemployment rate in U.S. is about 5.5%. American’s personal income rose solidly, increasing about 0.4% per month in 2007. Currently, U.S. economy is experiencing health growth. There is the increasing in bargaining power of the people. The industry of transportation becomes more and more important because the demand of transportation is increasing. This is an opportunity for FedEx to expand its businesses in United States.

In addition to U.S., the economy of Asia also continued to recover. It may have a favorable impact on the growth of transportation industry with the acceleration of domestic as well as foreign trade. For instance, China’s economy, an economy with 1.3 billion people double in size after 10 years or later have a tremendous impact on the rest of the world’s economies and certainly on the transportation industry in which FedEx operates.

Currently, the oil price is at an unpredictable level. The oil price roses higher and higher in the past few months.The rapidly rising oil price causes the FedEx’s fuel