Fred Smith grew up in a family engaged in transportation for a long time.
1966 After graduating from university, he was drafted into the Marine Corps for military service and sent to Vietnam. 1969 retired and started his business activities.
After retiring, he inherited a sum of capital from his father's estate and bought the nearly bankrupt Akon Aviation Sales Company for $654.38 million. This is a service company headquartered in Little Rock, which is engaged in the maintenance of turboprop aircraft and jet aircraft. Due to poor management and long-term losses, the enterprise is dying. He is familiar with the aviation industry because of his interest in flying. After investigation, he thought that as long as the maintenance service was changed to the information exchange industry of second-hand aircraft, there was still much to be done, so he quickly changed his business direction. Under his painstaking efforts, he achieved great success and made a profit of $250,000 in just two years. This not only enabled him to accumulate experience, but also greatly stimulated his ambition to make a difference in business.
Holding the small express transportation industry is still his dream. Successfully taking over Akon Company has increased his confidence, and he can't wait to show his skills in this field.
The hardest part is actually in the beginning The first thing he has to do is to verify whether there is a small express delivery business market in the transportation industry and obtain a reliable basis. At this time, there are already more than a dozen air transport companies in fierce competition, among which Emory Air Transport Company and Flying Tiger Airlines are the two largest commercial companies, and their revenue in 1969 is as high as 1 billion dollars. He can't take it lightly, but he does see that they don't run the small express delivery business directly to their destination, which is gratifying. After careful investigation and analysis, he came to the conclusion that there is indeed a small express delivery business market in the transportation industry, which has not been developed and has great potential. Smith decided to organize a courier company.
It is not easy to prepare an express air transport company. It is imperative to have huge capital as soon as it is started. His only $8 million is just a drop in the ocean. However, Smith exercised and developed a character from an early age. Once he has set his ideal goal, he will pursue it tirelessly and will never stop until he reaches it. He often exudes an amazing adventurer temperament. In any case, he can't give up the market he has captured, no matter how big the risk is, he will take the lead. In this way, he threw his $8 million into the express transportation industry without hesitation.
However, although $8 million is not a small sum, it is really too little for the establishment of airlines. To this end, he had to go all out to raise funds. Under his persuasion, some capitalists put nearly $40 million into his courier company after repeated consideration. At the same time, several banks also took out the same amount of funds after feasibility analysis, making the total investment reach 90 million US dollars. This huge investment became the largest single investment in American business history, which shocked the American business community in one fell swoop, and Fred Smith's name spread in all directions.
1 971June1day, Smith's FedEx Company was formally established. The address is in Little Rock, where there is the Akon Aircraft Sales Company that he originally bought. It has a certain foundation and is easy to start business. As soon as the company was established, he devoted himself to business preparation. He bought 33 Da salter Eagle twin-engine business jets at a discount of 7.5%. This kind of plane is small, safe and reliable, easy to take off and land in small airports, and cheap. It not only saves money, but also is convenient to get the national transportation license of the Civil Aviation Administration. At the same time, he recruited people, set up institutions and made business plans. After a year and a month of intense and busy preparation. 1973 On April 17, the company officially opened its business, and then started business in 22 cities.
FedEx did not have a smooth sailing after its start-up, losing money for two and a half years in a row. Although this is expected, after all, funds are tight and investors are becoming more and more suspicious and hesitant. 1974, technical liabilities of the company. In order to pay off the debt, Smith sold his private jet; In order to pay the wages of employees, in desperation, he went to Las Vegas to gamble and paid his salary with the $27,000 he won. In order to buy gasoline, he sold his daily necessities as collateral; In order to avoid the judge's inspection, he hid the transport motor. In this way, he tried all appropriate or inappropriate methods to support the operation of the company. But these are only stopgap measures, and new problems have emerged since the incident.
The only way is to develop business, and Smith is very clear about it. He always pays close attention to opportunities and seizes them as soon as he finds them. 1974, employees of UPS went on strike for a long time. Smith immediately seized this opportunity to attack the other party's business scope and seize the market, thus expanding the company's business and reducing losses; Soon, the closure of REA Express Company provided conditions for Smith to expand his business, and he easily occupied the market of REA Express Company. His consistent practice is to learn from each other's strengths, constantly overcome problems in business, improve service, enhance credibility and win customers. He followed the example of "United Parcel Company" and limited the weight of the goods to 34 kilograms and a certain volume, forming small materials. In this way, it will not only help to reduce labor intensity, improve efficiency, but also win time. For another example, he improved the sorting system and adopted "central sorting and direct delivery to customers", that is, the received customer packages were sent to the central airport first, and the goods were sorted by the central airport to the destination station, and then directly delivered to customers by the company. The central airport is located in Memphis, with perfect facilities and good conditions. In order to further expand his business, he adopted three delivery methods: one is night delivery; The second is the next day delivery, that is, the next day delivery at a reduced price; The third type is express delivery, that is, the articles use the company's special "Manila large-page envelope", and each piece is charged at a fixed price of $5.
Due to the continuous improvement of the company's service quality and flexible management methods, the business has developed by leaps and bounds. Turn losses into profits by the end of 1975. The turnover of 1976 is10.09 million USD, and the net profit reaches 8 10/0.09 million USD. The company finally passed the most difficult period and began to embark on the normal development path. 1977 the state relaxed the management regulations and allowed companies to use large aircraft to operate freight. This year, Smith bought 65,438+000 semi-old Boeing 727 aircraft, which made the business develop rapidly. The annual operating income increased to $65.438+$60 million, and the net profit increased to $20 million. By 1980, the company's turnover jumped to $590 million and its profit was close to $60 million. "FedEx Company" sprang up suddenly in the fierce competition, and Smith's ideal became a reality.
Smith believes that the reason for FedEx's success lies in its adventurous spirit and correct decision. He believes that without the courage to take risks, it is difficult to achieve any career, especially in the face of difficulties. Adventure is "not the most dangerous road". On the contrary, "the most dangerous road is not to act" and not to take risks! At the same time, he also believes that adventurous spirit is not enough, and he opposes the view that entrepreneurs are equal to gamblers. He believes that as an entrepreneur, you should be wise, analyze the situation, study countermeasures and seize opportunities, and you can't rely on luck. His success lies in the close combination of the two. He is resourceful and resourceful in taking risks, and he is both.
The fundamental purpose of his express delivery business is to make money. As long as he finds it profitable, he will seize the opportunity keenly and never let it go, not afraid of any big risks. 1978 When FedEx just got out of the predicament and turned a profit, he carefully studied the situation and predicted that it would be better in the next year or two. To this end, he decisively issued 65,438+0,075,000 shares at $3 each, almost walking a tightrope. However, he has a good idea to make profits year after year. At 65,438+0,980, the par value per share rose to $24, an eight-fold increase in two years, and both he and his shareholders made a fortune.
Improving service quality and attracting customers are the basic points of enterprise development. From the first day of the company's opening, Smith put service quality first. He writes to customers regularly for advice, never letting go of even the smallest dissatisfaction of customers, and immediately improves. He instructed his subordinates to do special research reports and solve them seriously. He believes that the interests of customers and the interests of the company are linked, and solving customer dissatisfaction is related to the interests of the company. He has attracted a large number of customers in just a few years, which is not unrelated to his great emphasis on service quality.
It is also an important aspect that can not be ignored to publicize the company's image, expand its influence and make it a household name. Not only did he spend enough money on publicity activities during the initial operating loss period of the company, but even after the company made a profit, he did not hesitate to spend it on publicity. At one time, he even took out 10% net profit to introduce the company's business, which was full of tricks. For example, the company's cars and planes are decorated with orange, purple and white paint, so that people can see from a distance that they are "FedEx" cars or planes; Newspaper advertisements are often published in full pages, and most of them are influential newspapers; He learns from each other's strengths, fully highlights his own color, and emphasizes the spirit of wholehearted service and the characteristics of quickness, punctuality, safety and reliability. His efforts in publicity were not in vain, and the success of the enterprise reflected the effect of publicity everywhere. Explaining his intention to spend huge sums of money on publicity, he said: "I am buying the credit needed to attract capital." It is this kind of credit that enables him to obtain enough capital; It is this credit that enables him to defeat his opponent; It was this credit that made him famous.