Logistic industry analysis
- 1. COLLOQUIUM Logistics industry Presented By Anjali Ruhela Anjani Singh Ashish Yadav Richa Juneja Twinkle Kodwani
- 2. Introduction It may be defined as the 'management of inventory in motion and at rest.' Logistics is about moving materials, information and funds from one business to another business or from a business to the consumer. Logistics includes roadways, railways, waterways and airways. It encompasses activities like freight transportation, warehousing, material handling, protective packaging, inventory control, order processing, marketing, forecasting and customer service.
- 3. Introduction The annual logistics cost of the world is estimated at about USD 3.5 Trillion India spends around 14.4% of its GDP on logistics and transportation as compared to less than 8% by the other developing countries. Indian freight transport market is expected to grow at a CAGR of 13.35% by 2020 driven by the growth in the manufacturing, retail, FMCG and e-commerce sectors.
- 5. Founded 1969 Headquarters Bonn, Germany Key people Ken Allen Adrian Dalsey Larry Hillblom Robert Lynn Number of employees 325,000+
- 6. Founded 1971; 45 years ago (as Federal Express Corporation) Little Rock, Arkansas Founder Frederick W. Smith Headquarters Memphis, Tennessee,U.S. Area served Worldwide Key people Frederick Smith (Chairman, President & CEO) Number of employees 400,000+ (2016)
- 7. Founded 1990 Headquarters Bangalore Founder Subhasish Chakraborty Number of employees 10000+
- 9. POLITICAL Government policies like FIPB. Industry licensing and liberalization of capital. Introduction of private sector participation, especially in port sector. In order to liberalize the railway service, the government opened its doors of container business to private parties.
- 10. ECONOMIC Impact of GST. Fluctuation in fuel prices. Growth in GDP and trade.
- 11. SOCIAL Women joining the labor force. Highway improvement projects. Promote community values. Acceptability of different localities and regions.
- 12. TECHNOLOGICAL Inventory management and barcode systems. Transport and management systems. Radio Frequency identification. Web enabled communications.
- 13. ENVIRONMENT Transportation sustainability. Considering Green logistics with industry perspectives. Global Warming.
- 14. LEGAL Data security. Risk allocation. The single window. Foreign corrupt practices Act and Anti – corruption laws worldwide.
- 16. Fed Ex DHL DTDC Services offerings • Home delivery services • Insurance and custom • Managing shipments like – package, envelope, express freight, extra care handling, Air/Ocean Freight forwarding etc • Third party logistics • Warehouse services • Express- Courier services for urgent and reliable transportation • Global forwarding- Rail, road, ocean & air services • Supply chain- Warehousing, Transportation management and value added services • Premium services- temperature controlled storage as well as cold storage. • Online tracking • Pin code finder • SMS alert facility • Premium express- assured next day delivery, up to 100kg. • Also offers franchisee • Warehouse services • E-commerce logistics • DTDC plus- money back guarantee, if not delivered on time. Price • Competitive pricing • Differential pricing rates • Although freight rates are remarkably increasing, company has kept its rates mostly unchanged • Recently adopted Dimensional weight pricing. • Competitive pricing • Differential pricing • Customized DHL services are highly priced • Special discounts for loyal customers • Competitive pricing • Differential pricing rates
- 17. Fed Ex DHL DTDC Promotion • Different taglines • Sports as a promotional medium • Sponsorship • Logos & taglines on all their delivery vehicles and all their stationery • Outdoor hoardings • Television ads • Newspaper ads • Social media ads • Television ads • Newspaper ads • Social media ads • Magazines • Sponsorship of national & international events • Go Green Campaign • It was a part of Make in India Campaign. • Logos & taglines on all their delivery vehicles and all their stationery • Different taglines • Television ads • Newspaper ads • Social media ads • Magazines • Logos & taglines on all their delivery vehicles and all their stationery Place • Headquarters- Memphis, Tennesse, U.S. • Place of distribution- Worldwide • FedEx’s own outlets • Online(by creating account) • Headquarters- Bonn, Germany •Worldwide distribution •Terminals, Offices and 1590 Warehouses • Multi-User & multi-Story warehouses specially industrial estates • Headquarter- Banglore •Worldwide distribution • Branch Offices • 5800 franchisees
- 18. Fed Ex DL DTDC Process • Process of delivery: > Status of the parcel > facility of express delivery in case of urgency • Most of its processes are automated and main focus is given on reliability and affordability of its services. • Package Tracking • Uses of soft trans program • Questionnaires for measuring customer satisfaction • Reports are recorded through I-sell program. • High cost for maintaining customer loyalty • Package Tracking • Customized IT solutions • Franchisees- access to corporate and legal offices • Accuracy and integrity of transactions • Centralization • Transactions on IT systems • Package Tracking People • More than 4,00,000 employees • Staff Training • Timely Delivery • More than 3,25,000 employees •Training programs for developing communication skills & other skill sets. • More than 10000 employees • Equal opportunities to all employees • Training programs and multiple development initiatives Physical Evidences • Employee’s Uniform • Several outlets & Offices • Printed invoices • Their delivery vehicles • Website • Business cards • Packaging material and buildings • Website, brochures. • Business cards • Printed invoices • Their delivery vehicles • Employee’s Uniform • Website, brochures. • Business cards • Printed invoices • Their delivery vehicles
- 20. CURRENT RATIO Current ratio =current assets/current liabilities One of the most fundamental or classic measure of liquidity ratio Indicates weather business can pay debt over the next business cycle. Ideal ratio is 2:1 .
- 21. CURRENT RATIO 1.96 2.74 1.34 1.21 1.12 1.69 1.96 1.82 1.84 1.50 2.90 2.02 2.28 2.07 1.88 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 2012 2013 2014 2015 2016 DHL FEDEX DTDC
- 22. ASSET TURNOVER RATIO Asset turnover ratio =Net sales/Average total asset. The ratio of the company’s sales or revenue generated relative to the assets. It measures the company’s ability to generates sales from its average assets.
- 23. ASSET TURNOVER RATIO 1.41% 1.06% 0.66% 0.52% 0.68% 1.49% 1.40% 1.37% 1.35% 1.21% 2.48% 3.31% 3.01% 3.59% 3.75% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 2012 2013 2014 2015 2016 DHL FEDEX DTDC
- 24. DEBT EQUITY RATIO Debt Equity Ratio =Total liabilities/Shareholders fund. Used to measure company’s financial leverage. Result may be presented in % or in numbers.
- 25. DEBT EQUITY RATIO 0.21% 0.18% 0.01% 0.03% 0.02% 0.08% 0.16% 0.31% 0.48% 1.00% 1.12% 0.83% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 2012 2013 2014 2015 2016 DHL FEDEX DTDC
- 26. NET PROFIT MARGIN Net Profit Ratio= Net profit after tax /Net sales. It is popular profitability ratio that shows relations between net profit and net sales. High ratio indicates efficient management business affairs.
- 27. NET PROFIT MARGIN 2.81% 1.33% 21.84% 46.22% 18.69% 4.76% 3.52% 4.60% 2.21% 3.61% 8.20% 8.70% 6.43% 5.59% 7.34% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00% 40.00% 45.00% 50.00% 2012 2013 2014 2015 2016 DHL FEDEX DTDC
- 28. DEBTORS TURNOVER RATIO Debtors turnover ratio =Net credit sales/Average account receivable. An activity ratio measuring how efficiently firm uses its assets. Higher ratio would be more favorable for frequently collection of receivables.
- 29. DEBTOR RATIO 24.81% 20.44% 12.94% 9.63% 8.03% 15.73% 15.03% 16.51% 15.43% 15.74% 8.70% 10.41% 7.83% 8.13% 8.37% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 2012 2013 2014 2015 2016 DHL FEDEX DTDC
- 30. Analysis
- 31. DHL : SWOT Analysis Strengths Weaknesses Opportunities Threats 1.It has the leading share of the worldwide air cargo market 2.Network in more than 220 countries and territories. 3.Received position in the magazine’s “World’s Top 50 Cargo Airlines” list 1.Government owned competitors 2. Since this is a competitive segment, the market share growth is limited 1. Tie-ups with corporate and business houses 2. Opportunities in Financial markets 3.Global expansion 1. Natural disasters and turbulent economies 2. Declination of traditional services (Letters) due to electronic communication
- 32. FEDEX : SWOT Analysis Strengths Weaknesses Opportunities Threats 1. Network in more than 220 countries. 2. Dependable knowledge in the delivery business 3. High investment in IT systems 4. More than three decades of experience in logistics services 1.More dependence on US market 2. Since this is a competitive segment, the market share growth is limited 1.To use cooperative strategies 2.Challenging competitors through mergers and acquisitions 3.Local competitors with poor service & products 1. Rising fuel prices could impact company’s profit 2.Varying market demand 3. Vulnerable to increasing reach by major competitors
- 33. DTDC : SWOT Analysis Strengths Weaknesses Opportunities Threats 1. Good delivery service in over 3700 Indian locations and 240 international locations 2. Pioneers through Franchise Business 3. Good Sales and customer support 4. Web based tracking 5. Delivers approx 10 million Parcels a month 1. New in e-commerce businesses and retail stores that will sell air tickets and phone recharges 2. Company finds it difficult to set up retail stores and logistics networks simultaneously 3.Lack of awareness among the Indian shippers 1.Few players in the organized sector 2.It is a debt free company which can be help for rapid expansion 3.Acquiring stake in other companies can be utilized to penetrate and consolidate its presence all over Asia 1.Taxes across the border can impede DTDC’s growth plans 2.Service complains of customers can portray bad image 3.Local companies with very low charges
- 34. References www.fedex.com www.dhl.com www.dtdc.in www.mbaskool.com/brandguide/transport-and-logistics www.moneycontrol.com Indian institute of management, Ahmedabad ( report on logistics industry by pankaj Chandra ) ASSOCHAM report on “ National summit - LOGISTICS INDIA 2016 ”
- 35. Thank You Any Questions ???