Fedex in China

Abstract

Case Description: This case describes how FedEx runs its business in highly regulated Chinese market. In particular, FedEx faces high legal barriers from the Chinese government to expand its Chinese domestic express delivery business. This case provides an overview of Chinese express delivery business and FedEx. The case can be covered in one class period. Student preparation time is about two hours. The case can be used for the topic of international business and strategy. The difficulty level of the case is appropriate to students who are juniors in a bachelor's degree business program. Case Synopsis: The express delivery business in China is growing at a rapid speed and is considered as the third largest market for express services. The Chinese delivery market generated 105.53 billion yuan profit with the growth rate of 31.9% in 2012 alone. While FedEx occupies 20% of the market share in the international delivery market in China, it only takes up around 1% of the domestic express delivery market share. Even though the Chinese government reduced its legal barriers to foreign firms, Chinese Government's regulations are still barriers for FedEx to grow in the domestic express delivery market. In addition, intensive competition from domestic firms exists in the domestic express delivery market. What kind of strategies should FedEx come up with for the Chinese express delivery market?.