Business Case Studies, Mergers, Acquisitions and Takeovers Case Study, FedEx Kinko’s to FedEx Office: Brand Management and Cultural Integration Challenges

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Case Title:

FedEx Kinko’s to FedEx Office: Brand Management and Cultural Integration Challenges

Publication Year : 2009

Authors: Fareeda, Girija. P

Industry: Transportation

Region:US

Case Code:  MAA0167

Teaching Note: Available

Structured Assignment: Available

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Abstract:
This case enables an interesting discussion on FedEx’s decision to drop one of its acquired brands, Kinko’s, from its name. Having acquired Kinko’s in 2004, FedEx named it as FedEx Kinko’s and operated under the same brand name till June 2008.

In 2004, FedEx acquired Kinko’s, a chain of copying stores to increase its ground shipping market through Kinko’s store locations. Reportedly, during this time (2004–2008), the profits of the acquired unit have fallen from $100 million in 2004 to $45 million in 2007. In 2008, FedEx announced an $890 million write-off on the purchase of Kinko’s and named third CEO to head Kinko’s in four years. The company also developed an ill reputation for poor customer service, during the 4 years of its operations. To avoid further damage, in 2008, FedEx decided to drop Kinko’s name from its brand and continue operations under a new brand name, FedEx Office. Will the new brand name help FedEx improve its performance in copying and business services segment or will it call for new problems?

Pedagogical Objectives:

  • To understand the nature of FedEx business and discuss the Key Success Factors (KSFs) for its business
  • To analyse the ideal growth options for FedEx, given nature of its business and evaluate the strategic fit between FedEx and its acquired companies, especially the strategic fit between FedEx and Kinko’s
  • To analyse the reasons for Kinko’s poor financial performance during 2004–2008 and debate on FedEx’s decision to drop Kinko’s from its name and going in for a new name FedEx Office
  • To debate on the efficacy and feasibility of continuing with the brand identity of acquired company – in this case, the Kinko’s brand – or does it make sense to integrate the brand of acquired companies with the brand of acquiring company.

Keywords : Mergers and Acquisitions, Cultural Integration, Brand Integration, Diversification, Innovation, FedEx, Kinko's, Hub and spoke, Logistics and supply chain, Freight Services, Brian Philips

Contents : 
Fostering a High Performance Innovative Culture
Responding to Competition
The Services of a Typical Kinko’s Store
FedEx’s Acquisition of Kinko’s – The Synergies
Services of FedEx Kinko’s
FedEx Corp.’s Growth through Acquisitions
FedEx Journey through Innovations

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