Airborne Express (A) By Jan W. Rivkin


Subjects Covered:

Business units; Cost analysis; Globalization; Industry analysis; Partnerships; Pricing policies



In the wake of a highly successful quarter, senior managers of Airborne Express, the third largest player in the express mail industry, review the firm’s competitive position. Airborne has survived, and recently prospered, in an industry with significant economies of scale even though it is much smaller than industry giants Federal Express and United Parcel Service. The case challenges students to understand Airborne’s unusual position. Detailed data allow students to analyze Airborne’s relative cost position, the fit among its activities, the differences between Airborne and its rivals, and the evolution of its industry. Using these analyses, students make recommendations concerning the firm’s pricing policy, its globalization efforts, and a partnership with a related company. Designed to be taught in a course on business-unit strategy.

Learning objective:

To illustrate multiple, viable competitive positions within a single industry; to permit students to analyze relative cost; and to teach competitor analysis. Can also be used to examine industry evolution and path dependence within organizations.


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