Distinguish Yourself as a Buyer
Are you having trouble getting a response from a routes broker? Or, are you finding that every listing that peaks your interest is under contract before you ever even make contact with the broker?
In this industry, there are dozens of prospective buyers for every FedEx Ground routes for sale listing you see. The market is hot!
As an investor, then, what can you do to be more competitive?
Follow These Tips to Have a Chance at the Best FedEx Ground Routes for Sale
Do your research ahead of time. Hire a consultant, read online articles, and educate yourself on how FedEx Ground works.
Just as you will evaluate a listing and a seller, a broker will be evaluating potential buyers. Does this investor understand what they want and how this investment works? Many investors are kicking the tires on FedEx Ground investments these days and brokers are inundated with basic inquiries. Once you establish yourself as an educated and serious investor, brokers will be more likely to reach out to you when a strong opportunity becomes available.
Tip: test your broker on their knowledge of the FedEx Ground industry. After doing your own research on FedEx Ground, engage potential brokers in quality FedEx Ground conversations. If a broker doesn’t know much about FedEx Ground or has inaccurate information, this is an indicator that you should evaluate the listing cautiously. They may be misrepresenting information without even knowing it!
Create your corporation. FedEx Ground requires an S Corp or C Corp; if you have an LLC, it will not be useful in the purchase of FedEx Ground routes. Establishing a corporation and holding a Federal Employer Identification Number (FEIN) will allow you to move forward with an application more quickly.
Prepare your Request for Information (RFI) ahead of time. FedEx Ground requires that each prospective contractor submit a standard business plan that outlines their core competencies while addressing a variety of FedEx Ground-related subject matter. Preparing one in advance of a potential purchase shows you understand FedEx Ground and are ready to take action.
Have a Purchase Contract already reviewed by your attorney and ready to go. This will give you a significant timeline advantage when you are interested in the most appealing routes.
The most important thing you can do to distinguish yourself as a buyer is to have your funding sourced and ready. If you are purchasing routes with cash, consolidate your purchase funds, and be prepared to provide proof of funds.
If you are not paying with cash, you need to identify a lender. Ideally, you should find a lender who has FedEx Ground experience. This lender experience will save you time and headaches in the process. Route Consultant clients receive access to a variety of qualified lenders based on their search criteria and eligibility.
As you evaluate listings, be sure to shop in the appropriate price range based on your funding source. Small Business Association (SBA) loans ask borrowers to have a down payment that is 10%-20% of the routes purchase price. The SBA does make exceptions to that figure, but the borrowers’ chances of approval are significantly higher if they meet this criteria. If you plan to use conventional financing through a local or national bank, you will likely need to have a down payment that is 20%-50% of the routes purchase price.
As you evaluate listings, be sure to shop in the right location for your funding. Some loans will restrict buyers to their state of residence. If you are securing an SBA loan and wish to purchase routes that are out of state, you must hire a manager with equity in the routes or give an equity stake to the existing manager.
If you intend to purchase your routes with a 401K rollover, please know that this process usually takes 30 days or more. Start the rollover early to avoid delays in a deposit or closing.
Learn From a Team of Professionals
If you are a prospective buyer looking seriously at an investment in FedEx Ground routes, we highly recommend you enroll in our Acquisition Strategy E-Course, our top-rated 12-week course designed to teach you how to successfully identify, acquire, and operate a FedEx Ground business.
Plus, as a consulting client, you'll get a special invitation to our exclusive New Investor Summit event. Gain confidence and make informed decisions about whether this investment is right for you.
Want to Learn More?
Dive into the world of logistics and delivery routes with our complimentary FedEx Ground Routes 101 E-Course. This course will teach you the fundamentals of delivery routes so that you can decide if this is an industry worth pursuing further. Whether you’re interested in FedEx Ground routes, Amazon routes, Bread routes, or other logistics operations, we are here to help. Enroll now for free and take the first step towards entrepreneurship in the e-commerce space.
