9-28-09 - -Barrier to entry-No treat to entry Supply –...

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9/28/2009 189 Package Delivery (Small) - Domestic - International Mostly Large Corporate Customers - No TV Ads - No A-Containers Resources - Wilmington HUB (Vxx) Location (VRI) Flight 600 miles from 60% of US pop - Patent on C-Containers (VRI) - Free Trade Zone (VRI) - Do own Repairs (Labor) (Vxx) - Focus (Customer tracking) (Vxx) - Libra II (Customer label maker) (Vxx) - EDI (Allow transactions of invoices and payments without papers) (Vxx) - Strategic alliances - C-containers (VRI) Philosophy - Flat organization structure - Centralized decision making - Low costs Operating Practices - Cockpit standardization (2 pilots per plane) - High upfront costs - Used Planes - Late pickup (deferred services) - International Freight Industry - Concentrated
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Unformatted text preview: -Barrier to entry-No treat to entry Supply – Commodities (Low)-Fuel – large competition so low bargaining power – Jet fuel is all same so no differentiation – Highish. .-Packaging-Labor – Union, high. No union, low-Planes Tech-Buyers-Corporations 50% Highish-Small Bus / Private 50% Low-Buying Groups, High a. Conflicts b. Needs are different Substitution - Low-Fax-Internet a. Email – bad b. Online shopping - good Conclusion-Profitability low-Huge economies of scale due to high fixed costs Therefore the company is not profitable-747 12sits wide 24 DC-8 6sits wide 14 DC-9 747s is 4 times bigger than DC-8s Fuel consumption is much lower than DC-8s...
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This note was uploaded on 09/08/2010 for the course BUS 189 at San Jose State.

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9-28-09 - -Barrier to entry-No treat to entry Supply –...

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