Buying ROUTES/ISP Don't trust Fedex Or Contractors

[bacha29]

I responded to you saying people were leaving rural areas. Maybe in your neck of the woods, but there are plenty of thriving small towns nationwide. You're not one of those guys that sees what's right in front of him and assumes it's like that everywhere are you?

Wait for the 2020 census and the new congressional redistricting map . I think you would be in for quite a surprise if not the the fact that according to your stated future plans you might be in a country that doesn't even do a national census.

 

[OrioN]

Who da eff are still trying to buy FXG routes???? Stick with real estate or something else, geez

 

[OrioN]

In a nutshell, you’re just gonna be Fred’s mechanics and overseers, all at your cost.

I'm my own mechanic & overseer...

 

[Mutineer]

There's literally no end to individual problems that can wreak havoc on any given service area.

Demographics, density, and prosperity aside. One of the worst problems a contractor can have is a perpetually angry/toxic customer.

I had a Walmart I delivered to. Generally easy to deal with. But there was a returns processing area in the back I had to check every day for pickups. The woman in charge of packaging returns worked in a separate area and often contacted FedEx with baseless, nonsensical complaints about myself and/or my drivers. For years I had to answer to management for her nonsense. Needless to say, I lost alot of bonuses. For YEARS I dreaded dealing with this crazy woman. UPS drivers mentioned to me that they had the same, exact troubles with her.

At some point, I stopped seeing her in her work area. Figured she was on vacation. Then one day, one of her co-workers cheerfully blurted to me "aren't you glad you don't have to deal with her anymore"? Her co-worker told this to me as if everybody on Earth had heard, and was celebrating over this news. I inquired, "what do you mean?"

And she went on to explain that the complainer-woman's family had her involuntarily committed to mental health.

 

[OrioN]

Were those complaints valid for you to lose your bonus???

I had one resis customer complaint a few years ago that I put his rock auto brake rotors and pads in his garage when it was a rainy day & left his garage door unlocked... it's full of his red neck toys and tools that probably costs more than his house & blames me for releasing his truck parts in there!

the complaint went thru appeals & was thrown out. I DEX 081 future HD deliveries to that jack ass for almost a year afterwards & they divert them to ground for his stuff to be released on the driveway without weather bags haha

 

[vantexan]

Wait for the 2020 census and the new congressional redistricting map . I think you would be in for quite a surprise if not the the fact that according to your stated future plans you might be in a country that doesn't even do a national census.

Of course they do. For someone who sees himself as "progressive" you're not very well informed.

 

[bacha29]

Of course they do. For someone who sees himself as "progressive" you're not very well informed.

For someone who is "conservative" you have and will continue to take advantage of Democrat sponsored social programs while demonizing those you don't qualify to collect benefits from. To be a true conservative you have to be wealthy enough to not need them and by your own admission you're a long way from that.

 

[vantexan]

For someone who is "conservative" you have and will continue to take advantage of Democrat sponsored social programs while demonizing those you don't qualify to collect benefits from. To be a true conservative you have to be wealthy enough to not need them and by your own admission you're a long way from that.

Who am I demonizing? In order for your spiel to work you have to lie about others.

 

[bacha29]

Who am I demonizing? In order for your spiel to work you have to lie about others.

Just about every person on the national political stage who happens to have the letter "D" beside their name.

 

[vantexan]

Just about every person on the national political stage who happens to have the letter "D" beside their name.

True, if they're a dipschitt I demonize them.

 

[Mutineer]

Were those complaints valid for you to lose your bonus???

I had one resis customer complaint a few years ago that I put his rock auto brake rotors and pads in his garage when it was a rainy day & left his garage door unlocked... it's full of his red neck toys and tools that probably costs more than his house & blames me for releasing his truck parts in there!

the complaint went thru appeals & was thrown out. I DEX 081 future HD deliveries to that jack ass for almost a year afterwards & they divert them to ground for his stuff to be released on the driveway without weather bags haha

For most of Complainer Woman's reign of terror, I had a TM that I had angered for abandoning a service area that was not in my contract. As such, that TM seized upon any chance to cause me misery. All said and done, I lost my bonus about 7 times due to that woman's unchecked mental illness.

 

[bacha29]

True, if they're a dipschitt I demonize them.

But a Republican in your mind's eye can do no wrong along worrying about the security of their wealth even if it was acquired illegally including compromising national security in order to get it.

 

[vantexan]

But a Republican in your mind's eye can do no wrong along worrying about the security of their wealth even if it was acquired illegally including compromising national security in order to get it.

Except that's a fantasy in your head. And I've been critical of plenty of Republicans.

 

[bacha29]

Except that's a fantasy in your head. And I've been critical of plenty of Republicans.

Show me some examples.

 

[dmac1]

1. Own your own Business
2. 5-10% Growth a year
3. Be independent, entrepreneur.
4. Your business will be worth millions
5. I make millions

1. ISP's are cheap labor corporations. They specifically provide expensive resources and low skill labor. ISP's only own their assets and liabilities. Assets consist of commercial trucks that are expensive, depreciate and lose value, and have limited use outside the industry.
Liabilities - ISP's cost are extensive and in comparison to revenue adjustments and bear out very little, and on many occasions negative net income/profit. Workers comp will continue to eat into a margin that in reality does not exists. Truck lease payments, insurance, maintenance, fuel, uniforms, and other cost are expected, however these cost in comparison to your Revenue will not reflect in increased profits.
THE BOTTOM LINE IS MAKE SURE YOU GET ALL ACCOUNTING RECORDS OF REVENUES & EXPENSES, ESPEACIALLY ANY THING THAT INVOLVES THE OWNER ATTEMPT TO MANIPULATE THE BOTTOM LINE. In other words the labor, management and expenses that an owner can hide by manipulating the true cost of their involvement. Some don't pay themselves a market wage, they do not disclose the true extent of their involvement with day to day activity, they claim they go home every day at 9am, you have to examine their books...do not rely on them being an accurate reflection of potential net.
There is much more to include, just do you due diligence, do not trust a word the Contractor says or Fedex. Do not trust,,,VERIFY!!!!!!

2. 5-10% GROWTH A YEAR - This is very misleading. Growth does not mean Profit. Fedex has designed a complex settlement process that avoids or eliminates gains in profit. The Growth that comes takes years to reflect as profit, in the mean time you will experience quarter after quarter and year after year of increased expenses and losses. A comparison of expenses and revenue will reflect a net negative result for years. A promise of increase in equity is an empty promise that involves risks they will not tell you. This equity they speak of only comes from what the market will dictate, and by the way also what fedex will consent to. Fall out of favor in any way, and all of the so called equity is subject to be eliminated. That risk alone depreciates the so called equity benefit. THERE ARE CONTRACTORS WALKING AWAY FROM THIS SCAM, LEAVING THE NON EXISTANT EQUITY. DO YOU RESEARCH. DO NOT RELY ON FEDEX OR CONTRACTOR RESOURCES TO VERIFY.
If you ever hear a contractor say in any of these posts, or in general conversation,," That guy just didn't want to grow", in the process of a negotiation with them, immediately have a certified accountant and attorney review your entire agreement and any data you was given to rely on. This is a red flag that the person you are dealing with lacks integrity and/or is a complete con at worst.

3. Be independent/entrepreneur-
The relationship does not allow for any REAL independence, except the condition that you are independent as it relates to expenses, risks, liabilities. It is extremely important that you do not account for independence in your expectations in any beneficial manner, it does not exists. There is an inherent benefit to owning your own business,,control, flexibility, freedom, these should be eliminated from your business plan/expectations. For your loss of these benefits you will receive nothing in return.
Efficiency is not reciprocal. Fedex can care less of how you can do more with less. In fact they see this as a threat to your relationship. Fedex just wants you to do more FOR LESS. Couple that with the loss of independence and you will soon realize the mistake you have made.

4. Your business worth? -
Depends on what you owe on your ever depreciating assets and compounding net returns. Your proprietary area has no real measurable worth, you do not own it. Fedex will try to convince you that you do when it fits their agenda, but they will exert control over this imaginary proprietary interest as they see fit. They will control you and your interest. They will exercise control and consent over what you can do with it. All this subject to how much you cooperate with all their demands. How you like that nightmare. As the problems with this model become more exposed and the horrible experiences of other contractors can be confirmed you will be left with a very small market of available customers willing to risk their money with this scam.

5. Make millions - it's not what you make, it's what you profit. If you are able to gather reliable data, absent the owner's manipulated input, and interview former contractors, communicate with active drivers, and compare ROI with the industry standards, then and only then have you begun the process of due diligence. DO NOT TRUST THE BROKER, DO NOT TRUST THE OTHER PARTY, DO NOT TRUST FEDEX. VERIFY
YOU HAVE TO UNDERSTAND WHAT WILL BE EXPECTED OF YOU FOR THE NEXT 5 YEARS. HOW WILL THIS IMPACT YOUR REVENUE. WILL YOU BE ABLE TO OPERATE WITH THOSE EXPECTATIONS AND ACCEPT THE SMALL PROFIT MARGIN WHILE EXPOSING YOURSELF TO RELENTLESS HARRASSMENT FROM FEDEX. IN CLOSING, YOUR CONTRACTOR BUDDIES, THEY ARE YOUR COMPETITORS AND THEY TURN ON EACH OTHER ALL THE TIME. DO NOT LET YOUR GAURD DOWN WITH THEM.

Oh bye the way it is not worth what they say.

Disclaimer - I am a contractor, I have witnessed these things at more than one terminal and interacted with many officers and managers of Fedex. I do not believe this model or relationship is legal, and is subject to extreme corruption at the cost of public trust.

In all of this, you missed what might be the most important from an investment standpoint-- Fedex can unilaterally cancel the contract at ANY time. Best case scenario if they do cancel, you can file a claim and recover lost PROFIT for the period remaining in the contract. If you paid $100k for the right to service the contract, and have a positive cash flow of $5000 a month, and have one year left and fedex cancels, you MIGHT recover $60,000 after paying for arbitration costs and attorney costs, which are NOT recoverable. And that's best case. You will be left with trucks you need to insure and make payments on until you can somehow unload them, and they will likely be worth less than what you owe, or worth less than what you paid.

And out of that $5000 profit you claim, fedex will subtract a couple thousand for depreciation on the vehicles if that $5000 doesn't already account for it. Fedex knows how many miles you drive every day, and will subtract about 9 cents per mile out of your positive cash flow for depreciation. People who think that because they have $5000 left at the end of the month means they have a profit of $5000 are dead wrong. Positive cash flow doesn't account for depreciation or income taxes. Depreciation is the declining value (loss of asset value) of your trucks. So that $5000 you try to claim as profit in arbitration you need to pay for will suddenly be $3000, reducing your MAX award to $36k if you have a valid claim in arbitration. After paying the attorney you will need, and paying the arbitration fees, you might win a net of half of that. But if you win, fedex can offer you your job back, and that means you need to be prepared to do the job, meaning you need to keep all the vehicles while waiting at least 3 months and keep making payments and keep paying insurance. If you have sold the vehicles to save money and your employees are gone, you might win arbitration and still lose everything.

The risk of total, or even partial loss of your investment on a literally worthless piece of paper is just stupid. Most people don't have a lifetime of savings that they can put at risk. At the very most, the value of the 'business is the value of the trucks plus the net taxable income of one year. If you are going to spend $100k, instead put the money into a couple of decent rental homes at $250k each with a 20% down payment.Almost anywhere in the country, the rent will pay all the cost, and other people will pay for your home. Where I live, you'd even have a few hundred a month POSITIVE cash flow, and could buy 3 decent rental properties with $100k, or even a small apartment complex, or a 4-plex, or a couple duplexesEven in a high cost area, like the San Francisco bay area, you can buy rental property within less than 100 miles away. Even in a redession, rental income doesn't go down much, even if the property resale value drops. If you had bought 2 $250k homes 5 years ago, with $100k down, you would have property worth $550k now, and owe about $380k debt, plus the income tax savings plus any positive cash flow..

If you buy right with real estate, there is almost no risk of losing your original investment. But with a fedex ISP, there is a good risk of losing everything.

 

[Bounty]

In all of this, you missed what might be the most important from an investment standpoint-- Fedex can unilaterally cancel the contract at ANY time. Best case scenario if they do cancel, you can file a claim and recover lost PROFIT for the period remaining in the contract. If you paid $100k for the right to service the contract, and have a positive cash flow of $5000 a month, and have one year left and fedex cancels, you MIGHT recover $60,000 after paying for arbitration costs and attorney costs, which are NOT recoverable. And that's best case. You will be left with trucks you need to insure and make payments on until you can somehow unload them, and they will likely be worth less than what you owe, or worth less than what you paid.

And out of that $5000 profit you claim, fedex will subtract a couple thousand for depreciation on the vehicles if that $5000 doesn't already account for it. Fedex knows how many miles you drive every day, and will subtract about 9 cents per mile out of your positive cash flow for depreciation. People who think that because they have $5000 left at the end of the month means they have a profit of $5000 are dead wrong. Positive cash flow doesn't account for depreciation or income taxes. Depreciation is the declining value (loss of asset value) of your trucks. So that $5000 you try to claim as profit in arbitration you need to pay for will suddenly be $3000, reducing your MAX award to $36k if you have a valid claim in arbitration. After paying the attorney you will need, and paying the arbitration fees, you might win a net of half of that. But if you win, fedex can offer you your job back, and that means you need to be prepared to do the job, meaning you need to keep all the vehicles while waiting at least 3 months and keep making payments and keep paying insurance. If you have sold the vehicles to save money and your employees are gone, you might win arbitration and still lose everything.

The risk of total, or even partial loss of your investment on a literally worthless piece of paper is just stupid. Most people don't have a lifetime of savings that they can put at risk. At the very most, the value of the 'business is the value of the trucks plus the net taxable income of one year. If you are going to spend $100k, instead put the money into a couple of decent rental homes at $250k each with a 20% down payment.Almost anywhere in the country, the rent will pay all the cost, and other people will pay for your home. Where I live, you'd even have a few hundred a month POSITIVE cash flow, and could buy 3 decent rental properties with $100k, or even a small apartment complex, or a 4-plex, or a couple duplexesEven in a high cost area, like the San Francisco bay area, you can buy rental property within less than 100 miles away. Even in a redession, rental income doesn't go down much, even if the property resale value drops. If you had bought 2 $250k homes 5 years ago, with $100k down, you would have property worth $550k now, and owe about $380k debt, plus the income tax savings plus any positive cash flow..

If you buy right with real estate, there is almost no risk of losing your original investment. But with a fedex ISP, there is a good risk of losing everything.

The only contractors who can make some money off this mess is the ones who got their routes for nothing, if they don’t stay in too long.
Only a boob would invest money in this nonsense.
I haven’t been following this site too much. I was just wondering, are these routes selling when they go up for sale?

 

[bacha29]

The only contractors who can make some money off this mess is the ones who got their routes for nothing, if they don’t stay in too long.
Only a boob would invest money in this nonsense.
I haven’t been following this site too much. I was just wondering, are these routes selling when they go up for sale?

The biz site I watch has a bunch that have been on the market for quite awhile. Owners are selling for a variety of reasons. I saw in several cases where contractors were downsizing. Lumping together low profit routes and trying to dump them onto unsuspecting individuals proving once again that you're only as good as the economic strength of the area you cover.

 

[12yearsaslave]

Man...I am so tired of these old ass first wave contractors bitching at the company. Yes the business changed. Yes It's more complicated now. Yes it's harder to manage. But there are thousands of successful contractors. A lot of us started small and now have big operations in multiple buildings. And yet these same ing names here bitch and bitch and bitch. GO. LEAVE. If you can't run this business successfully, get out. Let the businessmen take over and go be a ing driver. You are a failure. Not the model. Not Fred. Not anyone else. You.
PS Major metro grows 20-30% on H side. I do notice it's mostly pure ground ppl bitching. So go buy some H. Invest. Or get the out.

 

[bacha29]

Man...I am so tired of these old ass first wave contractors bitching at the company. Yes the business changed. Yes It's more complicated now. Yes it's harder to manage. But there are thousands of successful contractors. A lot of us started small and now have big operations in multiple buildings. And yet these same ing names here bitch and bitch and bitch. GO. LEAVE. If you can't run this business successfully, get out. Let the businessmen take over and go be a ing driver. You are a failure. Not the model. Not Fred. Not anyone else. You.
PS Major metro grows 20-30% on H side. I do notice it's mostly pure ground ppl bitching. So go buy some H. Invest. Or get the out.

From what I gather you came in after the first generation endured those very difficult formative years. Naturally you would likely have it better because somebody made it better for you. Furthermore, once consolidation is complete there will no longer be separate HD and Ground units. It will all be one followed shortly afterward by 6 day a week year round operations and 7 days a week not long afterward.

You talk about growth keep something in mind. Your employees are covered under Taft Hartley. They are completely within their legal rights to petition for union representation. If it were to happen your contract would be pulled so fast you wouldn't know what hit you.
There is nothing that you're doing that FXG can't do themselves except for the only two reasons you exist. One . To serve as a firewall against union representation and two, to provide XG with an endless supply of cheap trucking and cheap labor. There is simply no getting around that cold fact.

In the meantime you be alright as long as there's somebody walking through that door physically able and psychologically willing to go out there and deliver you top of the scale performance for bottom of the scale money and do it on a continuous daily basis for an extended period of time. When not if but when that day comes when nobody walks through that door and boxes assigned to you are sitting on your truck with nobody to drive it and or your employees are through doing the work of 3 people for half the pay of their peers...... we'll see who the failure is.

 

[12yearsaslave]

From what I gather you came in after the first generation endured those very difficult formative years. Naturally you would likely have it better because somebody made it better for you. Furthermore, once consolidation is complete there will no longer be separate HD and Ground units. It will all be one followed shortly afterward by 6 day a week year round operations and 7 days a week not long afterward.

You talk about growth keep something in mind. Your employees are covered under Taft Hartley. They are completely within their legal rights to petition for union representation. If it were to happen your contract would be pulled so fast you wouldn't know what hit you.
There is nothing that you're doing that FXG can't do themselves except for the only two reasons you exist. One . To serve as a firewall against union representation and two, to provide XG with an endless supply of cheap trucking and cheap labor. There is simply no getting around that cold fact.

In the meantime you be alright as long as there's somebody walking through that door physically able and psychologically willing to go out there and deliver you top of the scale performance for bottom of the scale money and do it on a continuous daily basis for an extended period of time. When not if but when that day comes when nobody walks through that door and boxes assigned to you are sitting on your truck with nobody to drive it and or your employees are through doing the work of 3 people for half the pay of their peers...... we'll see who the failure is.

I've been a driver since 2004. So yeah, sure I got it all handed to me...
Oh, and btw, I've been running a successful business that provides it's employees with benefits for almost a decade now. And I've seen old farts like you bitch in every meeting about irrelevant . And I've seen them go and retire and sell their business for upwards of 1.2mil. And new contractors continue to succeed. So you believe that the system is broken, while I continue to succeed.
Happy holidays.