A Case Study On The Business Structure Of The World'S Top 10 Logistics Companies

A successful logistics enterprise must have a larger scale of operation, establish effective regional coverage, have strong command and control center, and have high standard of comprehensive technology, financial resources and business strategy.

Over the past two years, enterprises of different fields, different sizes and scales have been competing for logistics.

But are all these enterprises able to successfully pform into logistics enterprises as soon as possible and get substantial profits?

Let's take a look at it.

world

Business structure

1.

Business profile: UPS is the world's largest express delivery company, the largest package delivery company in the world, and is also a major provider of professional pportation and logistics services in the world.

On weekdays, the company delivers parcels for 180 000 customers and the number of recipients is as high as 6 million.

The company's main business is in the United States and in more than 200 other countries and regions.

The company has built a large and highly reliable global pport infrastructure, developed a comprehensive, competitive and guaranteed service mix, and continuously used advanced technology to support these services.

The company provides logistics services, including integrated supply chain management.

Business distribution: UPS's business income has different distribution characteristics according to regional and pport modes.

From a regional perspective, the US domestic business accounts for 89% of total revenue, while Europe and Asia account for 11%.

From the perspective of pport mode, domestic land pportation accounted for 54%, domestic air pportation accounted for 19%, domestic delayed pportation accounted for 10%, external pportation accounted for 9%, and non parcel business accounted for 4%.

Dynamic: in January 10, 2001, UPS acquired the California logistics company of Fritz group under the issuing of 433 million US dollar new shares, and incorporated the company into UPS's expanding logistics business to make it a larger pport group.

In November 28, 2000, UPS increased its weekly global flight from 3 to 5 times to cope with the increasing number of pnational pportation businesses.

UPS the total cargo pported on this route increases by 200 thousand pounds per day.

2, FedEX

Business profile: FedEX, formerly known as FDX, is a global pportation, logistics, e-commerce and supply chain management service provider.

The company provides an integrated business solution to its customers through the independent network of its subsidiaries.

Its subsidiaries include FedEXExpress (express delivery business), FedEXGround (business packaging and ground delivery service), FedEXCustomCritical (high speed pport delivery service), FedEXGlobal (comprehensive logistics, technology and pportation services) and VikingFreight (small pport company in the western United States).

Business distribution: from a regional perspective, US business accounts for 76% of total revenue and international business accounts for 24%.

From the perspective of pport mode, air traffic accounts for 83% of total revenue, road accounts for 11%, and the rest accounts for 6%.

Dynamic: in January 11, 2001, according to a contract that can generate $6 billion 300 million in revenue, FedEX will deliver urgent and express letters to the US postal service between airports.

In the next 18 months, FedEX will pay 126 million to 132 million dollars to the post office as the right to set up inboxes in 10000 post offices and reserve the right to set up inboxes at the other 38000 post offices.

The move will enable the company to earn about $900 million in new revenue.

In December 29, 2000, FedEX announced plans to buy 16 million 380 thousand shares of AmericanFreightways company at a price of $28.13 per share to achieve its initial commitment to acquire 50.1% stake in the company.

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3, Deutsche Post World Wide Web (DeutschePostWorldNet)

Business profile: Deutsche Post is Germany's national post office. It is the leading logistics company in Europe and is aiming to become the number one in the world.

Recently, the brand was changed (renamed DertschePostWorldNet, DPWN).

On the one hand, it is preparing for the sale of listed products, on the other hand, it is aware of the globalization of its business and the increasingly important influence of e-commerce.

DPWN is divided into four autonomous sectors: post, logistics, courier and financial services.

The post office consists of post, market direct sales and publications distribution business, and has the highest level of operation network composed of 83 standardized inspection centers throughout Germany.

The express delivery department provides courier services covering Europe through EuroExpressGermany and EuroExpressEurope's global postal and international postal service sectors, and provides global business through cooperation with DHL (Germany post World Network owns 25% of its shares).

Through several acquisitions of Danzas brands, the logistics department was established in 1999.

The Department provides one-stop service and provides services in all links of the entire logistics chain.

Services include global aviation, shipping, European land pportation services and customized logistics solutions.

Meanwhile, financial services provided through Postbank became a wholly-owned Affiliated Companies in January 1999.

In January 2000, it acquired DSL Bank (a bank that specializes in private and commercial building loans), providing multi-channel banking services to private and commercial clients.

Business composition and distribution: from the perspective of net income, DPWN's four major businesses are postal, express, logistics and finance, accounting for 49%, 21%, 18% and 12% respectively.

Especially for geographical distribution of logistics business (from net income), Germany, France, Italy and other European countries accounted for 23%, 17%, 8% and 23% respectively, while Scandinavia, America and Far East Australia accounted for 12%, 11% and 6% respectively.

Dynamic: in January 2001, the German government made new legislation for the postal service, and the new law would allow the state to sell its majority stake in Deutsche Post.

In November 2000, the German Minister of Economics said the government would not end the DeutschePost's complete monopoly according to the original plan by the end of 2002.

Meanwhile, Germany post intends to increase its stake in DHLInternational from 50% to 75%.

4, Maersk/A.P.Moeller

MaerskSealand is the largest shipping company in the world. It has 250 ships, including container ships, bulk carriers, supply and special purpose ships, tankers, etc. the group also has a large number of loading and unloading terminals and logistics services.

Moeller's Affiliated Companies is also drilling oil and gas in Norway, Venezuela and other countries.

In addition, the group is also engaged in the manufacture and production of containers for shipping and intermodal containers, and operates a domestic airline MaerskAir and provides information services.

In addition, the company also owns the second Dalian lock supermarket in Denmark.

5, NipponExpress (Sun Tong)

Japan's pportation business is mainly divided into automobile pportation, air pportation, warehouses and others, accounting for 44%, 16%, 5% and 25% respectively.

Geographically, 93% of its operating income comes from Japan.

Its customers are mainly in the electronics, chemical, automotive, retail and technology industries.

6, Ryder

Business profile: Ryder systems provides a range of technically leading logistics, supply chain and pportation management services worldwide.

The company's products include comprehensive service leasing, commercial leasing, vehicle maintenance and integrated services.

It also provides comprehensive supply chain solutions, Frontiers of logistics management services and e-commerce solutions, from the input of raw materials to the distribution of products, and is committed to supporting the entire supply chain of customers.

Business distribution: from a regional perspective, US business accounts for 82% of total revenue and international business accounts for 18%.

From the business sector, pport services accounted for 57%, logistics accounted for 32%, and the rest accounted for 11%.

Dynamic: in November 20, 2000, Ryder systems and TOYOTA (America) Company and its Japanese parent company TOYOTA group jointly formed a joint venture called TTR logistics company.

The new entity will hold the same shares from Ryder and Toyota Corporation, and will focus on pportation and logistics business opportunities related to TOYOTA and other Japanese automobile companies in North America.

In November 14, 2000, Ryder and From2GlobalSolutions, one of the major suppliers of international logistics technology and trade intelligence of major global companies, announced the strategic alliance relationship.

Ryder systems will use From2's solution to provide specific international trade services to its customers through the Internet.

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7, TNTPostGroup

Business profile: TPG provides mail, courier and logistics services in over 200 countries and regions, and has a 50% stake in Postkantoren (which operates various post offices in Holland).

TPG uses TNT brand to provide express delivery and logistics services (TNT's logistics business is mainly concentrated in automotive, hi-tech and Pan European), and its logistics area has 137 warehouses, covering an area of 1 million 550 thousand square meters.

Business division and distribution: according to the type of business, TPG's three major businesses, mail delivery, express delivery and logistics (net income) account for 42%, 41% and 17% respectively, while in terms of regional performance (net income), Europe accounts for 85%, and Australia, North America, Asia and other regions account for 6%, 4%, 2% and 3% respectively.

From the perspective of operating profit, mail, express delivery and logistics account for 76%, 15% and 9% respectively.

Dynamic: in January 2001, TNTLoop obtained a efulfilment contract from YamahaMotorEurope.

TNT will provide online stores for Japanese automakers to provide "Back-End" services, including processing, warehousing and sending.

In December 2000, CtilLogistix merged with TNTLogitics in North America to become the seventh largest logistics company in North America.

In November 2000, TPG chose Vivaldi software as the global customer relationship management system to monitor and improve sales activities and manage customer service operations.

In October 2000, TPG and Shanghai automobile industry jointly established the third party logistics joint venture company.

The $30 million joint venture opened the door to China's automobile logistics market for TPG.

8, Expeditors

Business profile: the company is registered in the United States, is a global logistics service company, providing customers with a seamless international network to support the pportation and strategic placement of goods.

The company's services include air freight, ocean shipping (cargo service) and freight forwarding business.

Each office in the United States and many overseas offices provide customs services, and also provide logistics information services including distribution management, cargo collection, cargo insurance, order management and customer centred logistics.

Business distribution: from the perspective of business type, it mainly focuses on air freight, ocean freight and freight forwarding, and accounts for 63%, 25% and 12% respectively according to revenue.

From the perspective of regional distribution, it mainly concentrated in the Far East, accounting for 56%, and the income in the United States, Europe and the Middle East, South America and Australia accounted for 25%, 15%, 2% and 1% respectively.

9, Panalpina

Business profile: Panalpina is one of the largest freight and logistics groups in the world and has 312 branches in 65 countries.

The core business of Panalpina is integrated pport business. The services provided are integrated and suitable for customers.

Through integrated freight services, it will position itself between standardized pportation solutions and traditional consignment companies.

In addition to dealing with traditional freight, the group also specializes in providing logistics services to multinational companies, especially companies in automotive, electronics, telecommunications, petroleum and energy, chemicals and other fields.

AirSeaBroker is a global freight wholesaler of Panalpina group. It also coordinates the Panalpina group's marine system's regular contacts with other parts of the world, and provides new services for joint pport.

Under the AirSeaBroker, there are three business divisions: the shipping department, the West Africa Department, the chartering ship and the heavy lifting department.

Swissglobalcargo is a joint venture established by Panalpina and Sairlogistics in July 1999. It is the first air cargo company in the world to provide full integration, door to door, sometimes guaranteed, and no weight limitation.

Business division and distribution: from the total profit point of view, the four major businesses of Panalpina, namely, air freight, maritime pport, logistics and others, account for 44.9%, 31.3%, 20.3% and 3.5% respectively.

And in the geographical distribution of Europe / Africa accounted for 52.7%, the Americas accounted for 33.9%, Asia Pacific accounted for 13.4%.

Dynamic: in December 2000, a customer centered e-business platform was created, which was designed to link all operations of freight and logistics operations.

This "electronic network" provides an "integrated system", which connects the internal equipment of Panalpina company and the external electronic platform provided to customers.

10, Exel

Business profile: in July 26, 2000, OceanGroup was renamed "Exel" after merging with NFC.

Exel is divided into 5 major sectors: (consumer goods / retail / medical), Europe, consumer goods / retail / medical, Americas, development and automation, technology and global management, and Asia Pacific.

The company has 1300 outlets worldwide and over 50000 employees.

At present, the three main subsidiaries of the company are Exel (old NFC), Msas global logistics company and CoryEnvironmental.

Msas is one of the largest freight forwarders in the world. It provides multimodal pport, regional distribution, inventory control, value-added logistics, information technology and supply chain solutions worldwide.

CoryEnvironmental is one of the largest waste disposal companies in the UK.

Exel has a strong market position in ground pportation supply chain services. Its services include warehousing and distribution, pportation management services, customer focused services, JIT services and global aftermarket logistics services.

Business distribution: from the perspective of business type, Exel mainly concentrates on three aspects of distribution, pportation management and environmental services, accounting for 58%, 39% and 3% respectively according to net income. If it is divided into 62%, 28% and 10% according to the operating profit, it will be divided into three parts.

In terms of geographical distribution, business is mainly concentrated in the United Kingdom and Ireland, while in the Americas, continental Europe and Africa, as well as the Asia Pacific region, it accounts for 39%, 30%, 21% and 10% respectively according to net income. If it is divided into 54%, 27%, 10% and 9% according to the operating profit, it will be divided into three categories.

Dynamic: in January 2001, Exel was selected to manage the distribution of Motorola semiconductor products in the US, Europe and Asia.

The contract is worth about 134 million pounds.

At the same time, it signed a 10 year contract with MercedesBenzEspana to provide supply chain services.

Exel Automotive has won a 7 year contract to provide supply chain management services to Sandouvilielear, France.

In December 2000, Exel acquired Total logistics company (a regional supply chain management company based in Australia and New Zealand, which provides supply chain management services to more than 30 large pharmaceutical and medical companies).

In October of the same year, Exel and UPS jointly created a supply network for Ford Motor Co, and made a large-scale pformation of Ford Motor Co's supply chain needs in Europe.

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Summarizing the top 10 logistics enterprises in the world, we find the following 4 characteristics:

1, the logistics enterprises in the United States occupy a leading position.

Among the top 10 logistics enterprises in the world, 5 are in the United States, including two largest companies, UPS and FedEX. Meanwhile, the profits of these 5 companies account for 2/3 of the top 10 enterprises.

In a sense, the degree of development of the logistics market is directly proportional to the degree of economic development.

2, most of the 10 successful logistics enterprises are mainly based on air pportation, express delivery and land pportation.

For example, UPS's land pportation and air pport business accounted for 54% and 19% respectively. FedEX's air and road pportation business accounted for 83% and 11% respectively, while Japan's pportation and air pport business accounted for 44% and 16% respectively. TNT's mail and express business accounted for 42% and 41% respectively, and Panalpina's air and sea business accounted for 45% and 31% respectively.

3, the regional concentration of business is high (i.e., high degree of localization).

For example, UPS's domestic business accounts for 89% of its total business, FedEX's domestic business accounts for 76%, DPWN's European business accounts for more than 70% of its total business, TNT's business in Europe accounts for 85% of its total business, and Japan's pportation localization reaches 93%.

4, most of the 10 logistics enterprises are asset intensive enterprises, most of them have logistics facilities and networks.

Therefore, from the point of view of business structure, there will be great potential for the integrated enterprise with the background of express pportation and air pportation.

operation pattern

At present, most large logistics companies in the world adopt the system of head office and branch company, adopt centralized centralized logistics operation, and implement vertical business management. In fact, it is an integrated management mode (there is only one command center and the rest are operation points).

Practically speaking, modern logistics requires a unified command center and multiple operation centers.

Because effective control is the guarantee of modern logistics.

From the content of logistics business, each content is not complicated, but the coordination of the whole process of service must establish an efficient and authoritative organization system, which can control the implementation status and future operation of the logistics, and deal with all kinds of difficult problems and emergencies in the connection effectively and timely.

That is to say, it is necessary to have a highly capable and well command control center to control and coordinate the entire logistics business.

Various interfaces and decisions must be linked together to create an operating system.

If all departments emphasize that they are profit centers, the cost is always linked to the maximum profit.

Therefore, when undertaking logistics business and undertaking full service, there is only one profit center. All other organizations and departments should be cost centers. All obey the command of profit center, all serve the profit center, and all the profits of the profit center are their own interests.

It can be said that without a strong command center and an organic connected network, there is no real sense of logistics.

The real modern logistics must be a command center and a profit center. The organization, framework, system and other forms of the enterprise must be consistent with a center.

On the one hand, the division is strongly subordinate to the headquarters, headquarters has a high degree of control over the branch, and the division is professionally standardized and standardized.

On the other hand, headquarters must have strong command and design ability, high accuracy and risk control ability.

To do this, we cannot do without the ability to respond quickly to the market, and we must ensure that it achieves informatization and networking.

In the management and operation of modern logistics, information technology and information network play a very important role, even a symbol of the company's image and core competitiveness.

Therefore, large scale professional logistics enterprises usually have operation management system, quality assurance system, information management system and customer management system.

Profit model

By analyzing the top 10 logistics companies in the world, we find that the profitability of non asset logistics companies is obviously stronger than that of asset based logistics companies, and the core of competitive business is logistics management, also known as supply chain management.

Logistics design, control, organization and coordination capabilities are the basis of their competition.

The representative competitive means are: attaching great importance to the design of logistics solutions; strictly implementing uniform service standards in service operation; adhering to strict quality management system; and using information technology and information network to penetrate the whole service process of logistics.

Secondly, we find that most of the 10 successful logistics enterprises are mainly based on air freight, express delivery and land pportation. They also have large scale and strong profitability. This indicates that the time sensitive pportation service has great growth potential in the logistics industry.

Thirdly, although non asset logistics companies make quick profits, most of the top 10 logistics companies in the world are mostly asset based logistics companies, especially those with a large number of logistics facilities, networks and strong logistics design capabilities.

In recent years, the major logistics companies have taken the following measures to expand their business and increase profits.

1, through integration or mergers and acquisitions, enter a variety of pport business, increase profits.

Throughout the world's top 10 logistics enterprises, they are able to provide a wide range of services in pportation, and combine or merge in some industries or new fields related to logistics, so as to consolidate or occupy new markets, so as to achieve the purpose of increasing profits and gaining customers.

UPS, on the basis of retaining key customers, continues to expand its business scope through cooperation with customers, while focusing on developing huge potential markets.

For example, the development of spare parts logistics services involves almost all sectors of the global economy, from computer assembly to automobile manufacturing.

The company established ties with TOYOTA, Honda, Chrysler and other companies a few years ago. Recently, it formed strategic alliances with Ford Motor Company to provide supply chain replanning, pportation network management, parts service logistics, and provide technical solutions for automotive manufacturers and suppliers.

Recently, UPS has acquired a French spare parts logistics service provider FinonSofecom and two logistics companies located in Asia and Latin America, developing spare parts logistics services. In the future, the spare parts logistics service network infrastructure will also be built worldwide.

At the beginning of the year, the company joined a semiconductor company in the United States to set up a global distribution center in Singapore.

At present, the company has about 140 warehouses and warehousing facilities outside the United States.

In the next 7 years alone, its revenue will exceed $1 billion.

FedEX has opened up the Chinese market, and currently serves 190 cities in China. There are flights serving Beijing, Shanghai and Shenzhen airports, and will build the largest express processing center in Shanghai.

In the past two years, the German post group has bought Swiss shipping agency Dan Sha and AEI freight forwarders in North America for $5 billion. After integration, its turnover increased significantly, reaching 8 billion 300 million euros, up 86% over the same period last year.

The company will also increase its share in DHL international express from 25% to 51%, and is preparing to increase this share to 73% in the next two years.

TNT has reached an agreement with SmartParcel to provide a new Internet based European express service for German customers.

Exel signed a contract worth 20 million pounds with Amey railway maintenance company, and Amey gave all the logistics business to Exel to manage.

Exel recently bought a US logistics company for $331 million, which mainly provides logistics and freight forwarding services to the automotive industry. The acquisition will strengthen Exel's business in North America.

Last year, its turnover in North America increased by 53% to 1 billion 500 million pounds, operating profit of 56 million 300 thousand pounds, an increase of 43.3%.

2, re integrate business processes to achieve optimal allocation of resources.

Modern logistics is a broader concept. It includes e-commerce and a series of related services, telephone service centers, websites, trading systems, raw materials procurement, order fulfillment, pportation management and so on.

At present, the top 10 companies have "first-class three networks", that is, order information flow, global supply chain resource network, global user resource network and computer information network.

The utilization ratio of storage can be increased by more than 2 times.

3, provide quality and personalized services.

The biggest advantage of the agreement between TNT and SmartParcel lies in "tailor-made".

Customers can use computers or mobile phones with WAP function to decide when the package will arrive at the destination, and when the package is sent, the information will be automatically returned to the computer or cell phone designated by the customer.

In short, the top 10 logistics providers in the world have many advantages in terms of business structure, operation mode and profit mode, which deserve our careful study and analysis. It is worth learning from Chinese logistics enterprises or enterprises that are upgrading to logistics.

In particular, the success of these famous logistics enterprises, such as the larger scale of operation, the establishment of effective regional coverage, the ability to command and control, the high level of integrated technology, financial resources and business strategy, are worthy of our large-scale logistics enterprises (or enterprises that are marching into large logistics enterprises).