Every FedEx Ground terminal serves a defined geographic territory. FedEx Ground closely monitors—and prevents via scale requirements—any contractor/entity from growing too large or too small within a single terminal. They do so by prescribing the number of daily stops an entity can make as a percent of all terminal stops.

FedEx Ground businesses range in price depending on the number of routes, demand, profitability, and the health of the fleet. Knowing how to raise capital to fund FedEx operations is key to growing and being successful in this space.

Driver recruiting is a challenging part of being a Contractor, especially finding candidates who meet FedEx Ground’s requirements. FedEx Ground has announced new changes to Schedule I of the ISP Agreement regarding qualifications that P&D drivers must have to operate behind the wheel.

At any given time, about 5% of the entire network is for sale on the open market. The market inventory can and will fluctuate throughout the year, but overall this is not a concerning number.

You are charging FedEx for your services. You will negotiate each of the following charges with FedEx. All of these charges combined account for money flowing into your business. It’s critical you understand how and when those charges occur. And how you can increase your cash flow! Following is a quick overview of the charges you will negotiate as part of your Independent Service Provider (ISP) contract.

Perhaps you are considering a partial sale to manage growth in your organization? Or, maybe you are starting to think about retirement? Whatever your reason, thinking proactively about the value of your business is critical to maximizing your return on investment. If you understand the present-day worth of your operation, you can make necessary edits so you don’t leave cash on the table when it’s time to sell.

One commonly overlooked aspect of investing in FedEx Ground routes is the due diligence process. While this can be a lengthy and intimidating endeavor, it does not have to be! Whether you are looking at entering the space for the first time or expanding your existing operation, you should know what you are buying.

Healthy Fedex route businesses demonstrate profit margin ranging from 15-45%. Where you fall within that range depends on the type of routes you own, the composition of those routes, and how efficiently you manage your business expenses. strong P&D operation typically has a profit margin between 10-25%. Linehaul operations have a wider range of profit margins; typically, linehaul operations demonstrate margins between 20-45%.

An experienced broker understands the full sales process and and can help you avoid snags or pitfalls along the way. This experience both reduces your time commitment during the sales process and ensures you receive a healthy, fair market price for your routes.

This business is not rocket science. Your team needs to take a cardboard box from a warehouse to someone’s doorstep. It’s not more complicated than that. However, you need to have the people and the trucks to complete that goal over and over.

There are two distinct types of FedEx routes, and if you are considering buying a FedEx route, it’s important to figure out if you want to purchase pick-up and delivery (P&D) routes or a linehaul run. There are important and significant difference between FedEx P&D routes and FedEx linehaul runs.

When an investor chooses to purchase FedEx routes for sale at a terminal that is not close to the investor’s primary residence or place of business, we call the arrangement absentee ownership.

Terminating a contract can provide serious service interruptions for FedEx Ground customers and is a critical issue. FedEx Ground aims to provide seamless delivery service for all areas of operation. This being said, it is rare for a contractor to lose their FedEx Ground contract. Further, contractors almost always receive opportunities to resolve issues in advance of a contract termination

You can buy, operate, and sell the routes that move FedEx packages from one location to the next. FedEx routes have a long history of solid profit margins and FedEx as a company continues to outpace performance expectations. There’s much to love about this type of investment!

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.

As you look to buy a FedEx route, look for P&D businesses with profit margins between 10-25% of revenue. These are healthy businesses! While a very profitable business, FedEx route businesses do not generate profit margins of 30% or more.

When purchasing a FedEx Ground operation, you should always be prepared to have your manager give notice. Your manager will not be contractually obligated to you, so it is important to secure a window of support from the seller in case you lose your manager.

Difficult days on the job are part of every job. They can feel particularly stressful for your drivers. And they have options to go elsewhere if they are stressed too often. Be sure you have an atmosphere where team members feel respected and can be open with management about their concerns.

Drones are sexy. We get it. The idea of drone delivery feels like the future. As fun to think about as drone delivery is, it’s not a realistic mode of transportation for the type of packages FedEx Ground delivers

You will often hear us (and others) note that FedEx route businesses are tax-friendly investments. What do we mean by that? These businesses include substantial numbers of vehicles that you are able to depreciate over time. The vehicle depreciation in FedEx route businesses allows you to offset the revenue stream from the business.