Find Your Target Price
In order to determine your target route price for FedEx Ground routes, you need to consider what type of down payment you can make. Additionally, you should think through your take-home pay expectations.
We base these industry averages and targets on our experience in the industry. We know what healthy businesses look like!
HOW DO YOU WANT TO FIND YOUR TARGET: BY DOWN PAYMENT OR NET OPERATING INCOME?
Please fill in only one: desired net income OR desired down payment.
Within the United States, each state has extensive control over its own taxes, workers compensation rules, and labor laws. Further, each state has a different tolerance for employee-employer litigation. These variances make notable differences to a business.
Many new investors want to focus their search in on areas that also have high population growth. Population growth does contribute to package growth. However, as we cautioned before, beware of route businesses in cities where outsized growth contributes to low unemployment rates and upward wage pressure. These can be expensive markets with substantial hiring challenges.
If you serve a metropolitan CSA you have unique factors to consider. To start, we find that in a strong economy it is more difficult to hire drivers in cities where there are many employers and unemployment rates tend to be low. However, because of the higher wages and deeper pool of talent, route businesses in metropolitan areas have the opportunity to secure smarter, highly capable employees.
Our team of actual FedEx contractors worked through the math of new FedEx trucks versus used FedEx trucks in our own operations. We always want to make the most efficient choice for our fleets. We have compelling data that shows new trucks are the superior option for routes that are 150 miles per day or less. Why is this the case?
Healthy fedex route businesses demonstrate profit margin ranging from 15% to 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.
One of the ways FedEx Ground stands out among the crowd is its ability to receive and deliver large or incompatible packages. Think about all of the incredibly large items we can buy and sell online today that need some way to get from Point A to Point B: playground equipment, dining room tables, sets of tires, and more.