FedEx Route Consultant | FedEx Route Due Diligence
MyGround® Support has been providing numerous support services to FedEx Route or Linehaul Run Buyers including due diligence support since 2014. We've analyzed hundreds of routes over the years and our experience is unparalleled to others. Over 3,060 visitors visited our site in 2018 alone. According to SBA statistics only 55.66% of SBA loans in the Trucking (Local) business are repaid, it is a high risk business! We cannot stress how important it is to engage a highly skilled unbiased consultant like ourselves.
Our #1 Advice to Anyone Considering Buying FedEx Routes: Many components of FedEx Routes and Linehaul Runs are deceivingly more complex to evaluate and perform due diligence on then even the savviest business entrepreneur may think to review. CAPEX impacts are one of most important factors, if not the most important factor to consider. EBITDA & Owner's Cash Flow means nothing without CAPEX impacts considered. Vehicles don't last in perpetuity and they cost a lot!
Our specific FedEx Route Buyer services include:
In-Person All Day Linehaul Run (Route) Buyer Seminars - $850 | Next Seminar is in August 2019 | Baltimore Inner Harbor, Power Plant Live
Support can be reached at 240-490-2895 or firstname.lastname@example.org to inquire about consulting services offered. Please note we don't offer "free consults" via phone inquiries as we don't create buyer pools and interest in routes as an unbiased consultant. We do however provide some free Q&A later in this page that many have found very valuable. In lieu of our services, we also provide a Consult via Clarity.
Buying FedEx Routes - Free Due Diligence Q&A:
MyGround® Support's staff aren't "Route Guys" that do consulting on the side, but Fortune 100 Experienced Consultants with significant expertise and knowledge in FedEx Routes/Linehaul including personal ownership. We don’t “sell” great or bad things about FedEx Routes/Linehaul to you, aren't trying to get you interested in them (or not interested), and aren't trying to add your name to a list of potential buyers for a route broker. We offer the following free information from an unbiased perspective based on the top questions we get asked.
Q: Outside of financial related items, What should I be asking for in due diligence?
- Linehaul: TSPA Attachment A-1, Schedule B, and Schedule C for linehaul. Service Level & Availability Metrics. Screenshot of CSP Performance Dashboard.
- P&D: ISP Attachment A-1, Schedule B, and Attachment C-1. Inbound Attainment & Cure Letters. Screenshot of CSP Performance Dashboard.
- The Seller has an aged fleet and it is going to cost a massive amount of funds to replace the fleet. Buying routes or linehaul with an aged fleet is like buying a herd of dairy cows that have gone dry. CAPEX IMPACTS ARE ONE OF THE MOST IMPORTANT FACTORS IN ROUTE AND LINEHAUL EVALUATIONS.
- The Seller is becoming concerned about the future competition and declining revenue potential, specifically Amazon. Just in Sept of 2018, Amazon Ordered 20,000 vehicles for its contractor model for launch in 2019! These vans will be leased to new independent Amazon contractors. Shipping with Amazon (SWA) is coming soon and its not just for Amazon fulfilled packages.
- The Seller's contractual standing with FedEx Ground is in jeopardy. Engaging a FedEx skilled consultant is key to help determine if this is the case.
- The Seller is being affected by a change in FedEx Ground contracting requirements. CHANGES IN CONTRACTING TERMS ARE OCCURRING ALL THE TIME AND LATELY ARE VERY SIGNIFICANT. This could be caused by ISP overlap requirements, "e-commerce"/SmartPost obligations at extremely low rates, 7 day delivery, new equipment standards, new vehicle technology standards (FCAM - 2024 in Linehaul), ISP rates that were negotiated poorly / don't cover the costs, decreasing rates from FedEx, and numerous other factors in both linehaul runs and P&D routes.
- The Seller is a fairly new owner of the routes ( less than 3 years ) and has realized the routes are not as profitable as they thought when they purchased especially after CAPEX considerations. It is likely they didn't engage a skilled and unbiased FedEx Route Consultant in their initial purchase, overpaid as a result, and now have a full understanding of the true financial considerations and are trying to exit quickly. These routes will typically contain an aged fleet and an inflated asking price.
- The Seller is retiring and no longer wishes to run the business. These routes typically have higher published returns, but the key factor here is the Seller was likely running the day to day operations or driving so remember not to "buy a job". The Seller's salary when they are driving is not an acceptable add back in this situation and a market wage for the Owner's efforts must be in the payroll number or adjusted with a market wage.
Q: Can FedEx P&D Routes be run absentee or semi-absentee?, what about Linehaul Runs?
A: We will boldly say anyone claiming FedEx P&D Routes or Linehaul Runs can be run completely absentee has never owned them (we have!) or has something to gain from telling you that they can be. A Buyer could be making a very poor assumption assuming FedEx P&D Routes or Linehaul Runs could be run fully absentee either operationally or from a financial perspective. DO NOT BELIEVE ANYONE THAT TELLS YOU ROUTES CAN BE A PASSIVE INCOME ACTIVITY AS AN INVESTOR. Depending on the level of involvement and margin erosion that will occur, some P&D Routes and some linehaul can be run semi-absentee. Linehaul is likely to have more of a chance being run semi-absentee given the operations, but again do not assume it is possible at all. Margins at semi-absentee involvement are obviously lower than those where the owner runs the day to day operations.
Q: What expenses do I have running P&D Routes or Linehaul Runs, seems pretty straight forward?
As for a sampling of expenses...non-capitalized expenses would include, but aren't limited to Fuel, DEF, Payroll, Employer Payroll Taxes, Tolls (P&D only), Parking (P&D only), Parking Tickets (P&D only), Worker's Compensation Premiums, Scanners (P&D only), Tires, Repairs & Maintenance, Non-Capitalized Equipment Repairs, Annual Vehicle Inspection Fees, Rental Trucks/Rental Road Tractors, Heavy Use Tax (Linehaul Only), ELD Service (Linehaul Only), Vehicle Registration/ Vehicle Plate Fees based on GVW, Annual Business Personal Property Taxes, Vehicle Camera Systems, Driver Training Schools (P&D), Employee Timekeeping System/Software, Route Optimization professional fees (P&D only), Accounting/CPA Fees, Payroll Service Provider, Lawyer/Attorney Fees, Recruiting/Advertising Fees, Driver Uniforms, Small Equipment (dollies, carts, etc), Vehicle Washing Vendor, Vehicle Decals, DOT Physicals for Drivers, Annual State Corporation Filing Fees, Business/Commercial Property Taxes on Assets, Mobile Phone reimbursement to drivers,....the list goes on and on.