Looking to chat with searchers who've ran or looked at deals for small, independent contractor companies for Fedex Ground or other similar large couriers in the space? I've got a bunch of experience competing with these big guys in the tech space, but am curious to know what it's like running one of their small 3P subcontractors.
Please DM me if you've ran or looked at acquiring one of these small businesses.
Thanks!
Anyone have experience with Fedex Ground Independent Contractors?
by a searcher from University of Toronto - Joseph L. Rotman School of Management
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Patton called on all contractors to stop delivering on Black Friday if FedEx didn't improve compensation and end costly Sunday deliveries.
FedEx canceled all of his routes and sued him (Patton won, see article below).
While at the conference, I talked to many contractors. The struggles Patton called out were real.
After America's pandemic-induced online shopping spree, many contractors posted extraordinary results. But as online shopping declined, FedEx struggled to remain competitive with UPS. FedEx corporate tightened its belt and squeezed contractors – while fuel and labor costs increased.
I was skeptical of these businesses before attending the conference, too. I had looked at buying around a dozen FedEx contractors. I'm glad I didn't.
That one year of high profits vanished. But brokers were still demanding outsized valuations. At the conference, I met a guy who had bought some Pickup & Delivery (P&D) routes nine months earlier and was going broke.
In the last year, FedEx has moved to address some of the concerns Patton raised, including reducing costly Sunday P&D deliveries.
FedEx Ground "linehaul" routes, their contracted semi-trailer truck routes, typically have higher returns.
But I don't like owning a business that has just one client. Especially one that can dramatically affect my company's financials based on its internal pressures and whims, things that I have no control over.
Happy to connect if you'd like to talk, or brainstorm other types of companies to get into. ;-)
WSJ (gifted): FedEx Sues Ground Contractor, Cancels His Routes https://www.wsj.com/articles/fedex-sues-ground-contractor-that-has-agitated-for-change###-###-#### ?st=b1ssh2pdseqmpop&reflink=desktopwebshare_permalink