Little Bits of History

FedEx

Posted in History by patriciahysell on April 17, 2013
Frederick Smith

Frederick Smith

April 17, 1973: Federal Express officially begins operation. Frederick Smith was born in 1944. His father died in 1948. Fred was interested in flying and became a pilot while still a teenager. In 1962, while a student at Yale University, he wrote a paper for an economics class concerning the inadequate routes available to airfreight shipping companies. He was friends with both George W. Bush and John Kerry while earning his economics degree. He joined the US Marine Corps and became a Ground Officer in the service. He was not a pilot but rather was to “control” ground action. He received a Silver Star, a Bronze Star, and two Purple Hearts.

Back home in 1970, Smith purchased a controlling interest in Ark Aviation Sales, an aircraft maintenance company. He turned the company into a brokerage firm for trading used jets. His difficulty with the air shipping industry led him to do further research on his old college paper. The inefficiency of the system left room for improvement and lent a space for a new sort of business. On June 18, 1971, Smith took his $4 million inheritance and raised $91 million in venture capital (combined worth in 2008 dollars – $505 million) and incorporated Federal Express.

The official launch date saw 14 small aircraft take off from Memphis International Airport. By evening, they had delivered 186 packages to 25 US cities from Rochester, New York to Miami, Florida. The company was headquartered in Memphis, Tennessee because it was geographically positioned in the center of Smith’s major market area – and weather conditions were good for flying. The airport was also willing to make improvement needed to host cargo rather than simply passenger planes.

The company did not show a profit until June 1975. Legislation passed allowing for larger planes. By 2008, FedEx (name changed in 1994) had grown to be the world’s largest all-cargo fleet. They had a daily lift capacity of 26.5 million pounds and flew almost 500,000 miles. Frederick Smith remains Chairman and President of the company. With 2008 revenues of almost $38 billion and with more than 280,000 employees, things just keep moving.

“If you order a paperback book, slower delivery time via the mail or UPS is fine. But if you’ve ordered a fur coat, then FedEx is more of an option.” – Doug Rockel

“Fear of failure must never be a reason not to try something.” – Frederick Smith

“Leaders get out in front and stay there by raising the standards by which they judge themselves – and by which they are willing to be judged.” – Frederick Smith

“FDX Corp. is benefiting from the accelerated move to fast-cycle production and distribution methods, the growth in electronic commerce and supply chain re-engineering.” – Frederick Smith

This article first appeared at Examiner.com in 2010. Editor’s update: Frederick Smith remains the Chariman, President, and CEO of the company which still maintains headquarters in Memphis, Tennessee. Their total equity as of 2012 was $17.1 billion with revenue for that year at $42.7 billion.  Their net income for 2012 was $2.03 billion. Their biggest competitor in the US is United Parcel Service (UPS). All business need to market and FedEx is no exception they have had a number of slogans and ad campaigns and since 2009 there have been four running. Brown Bailout is a reference to issues stemming from some legal wrangling that involved UPS (Big Brown).  We Understand, We Live To Deliver, and The World On Time are three more campaigns used to promote FedEx. Their 1981 ad featuring John Moschitta, Jr. (a fast talker) was listed as one of the most memorable ads ever.

Also on this day: America’s Renaissance Man – In 1790 Benjamin Franklin dies.
Stories – In 1397, Chaucer presented the Canterbury Tales for the first time.
Frenchman Takes Off – In 1944, Henri Giraud escaped a POW prison.

Advertisements
Tagged with: , ,