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Airborne Express: Decisions concerning capital outlay may make or break this company’s venture into the global market.
During the nineteen eighties Airborne Express took account of itself and decided to take the big boys on head to head. The company sought to redefine, or maybe simply define for the first time, its image with the American public. Airborne Express set out with an aggressive advertising campaign to attract the so-called occasional customer, and expand its market share by cutting into Federal Express and United Parcel Service’s. Unfortunately for Airborne Express, the cost of gaining a few “occasional” customers outweighed the benefits. Thus, they were forced to redefine themselves, this time as a niche player serving large corporate clients with high volume. This led to great success as long as the market remained mostly stateside and these large corporate clients were satisfied with the overseas services offered by Airborne Express.
Of course, the economy has really turned global, and those large corporate clients have a growing demand for one company that can do it all. This has led Airborne Express to a crossroads concerning its commitment to the global market. The company has embarked on a strategy of buying space on other carrier planes, and has found this to work just fine. However, the market is changing and new challenges may make this strategy infeasible.
History and Overview
Airborne Express was founded in 1946. In 1968 the company merged with Airborne Freight Corporation, adopting the latter’s name but maintaining the former management. This new company began as strictly an airfreight forwarder, or a company that arranges for the shipment of freight by buying bulk space on carriers and reselling the space in smaller increments. Airfreight forwarders primarily deal with small customers and provide pick-up and delivery services from the airport.
This relatively small and unsophisticated op...
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