The FedEx Problem

186 packages to 25 cities in the U.S. from Memphis. In order to deliver small packages quickly the company used a novel strategy in the shipping business. Every day packages picked up from all over the country were flown to Memphis where they were sorted and then flown to their destinations for delivery the next day. The strategy has been extremely successful and has been adopted by other shippers such as UPS, which established a shipping hub in Louisville. Meanwhile, Federal Express has grown into a large company, now known as FedEx, with worldwide operations. According to the company website [6], Memphis was selected for its geographical center to the original target market cities for small pack-ages. In addition, the Memphis weather was excellent and rarely caused closures at Memphis International Airport. The airport was also willing to make the necessary improvements for the operation and had additional hangar space readily available. It is the question of the “geographical center ” that is the focus of this article. Suppose that FedEx were choosing its hub today with the assumption that anyone in the U.S. is equally likely to ship a package to anyone else in the country. The goal is to minimize the average distance the package must be shipped. Since we are assuming that the sender’s and receiver’s locations are independent an