FedEx Ground Business For Sale

Photo via Alexander Popov

Photo via Alexander Popov

Ready to buy a FedEx Ground Business for sale?

Fact: the person coming to your door driving a FedEx Ground truck and wearing a FedEx Ground uniform is NOT a FedEx Ground employee.

Maybe this is new information to you, or maybe you’ve known it for awhile, but I find that tidbit surprises almost everyone I tell.

To deliver its packages, FedEx Ground relies on a network of Independent Service Providers (ISPs). Investors own and operate their own businesses and provide a service to FedEx Ground based on a negotiated contract. We believe this FedEx Ground contracting business segment is one of the most well hidden investment opportunities in the United States!

There are a healthy number of FedEx ground businesses on the market right now. Why are contractors selling? For a variety of reasons, including:

  • Route scale requirements

  • Overlap requirements

  • Required transitions from Independent Contractors (IC) to ISPs

You can see in each of our routes for sale listings the reason a seller is listing their routes.

Ready to do some more research on FedEx Ground businesses for sale? Here’s your first steps:

Financing a FedEx Route: Don’t Be Afraid of Using Debt or Leverage to Get Started

Don’t be afraid of using debt/leverage to buy these businesses. These FedEx routes for sale can sustain a higher debt load than what some other businesses allow. Typically, your finance source will require a down payment of 20% or more. With a 20% down payment you lever your business 4:1. You have 1 part down payment and 4 parts debt.

What to Expect When Using Conventional Financing For Your FedEx Route Business

When we say conventional financing we mean receiving a business loan from a local or national bank or credit union. This is opposed to buying a FedEx route for sale with an all cash offer or using a Small Business Association (SBA) loan.

Why should you consider conventional financing for your FedEx route purchase?

How much does it cost to buy a FedEx route?

FedEx routes for sale can range in price dramatically. In the past year, we have seen opportunities range on the lower end at $299,000 to our highest priced listing at $5,390,000.

Our current portfolio of Active and Under Contract routes have an average list price of approximately $760,000.

Looking to Sell FedEx Routes? Free Business Valuation for FedEx Route Owners

Many, many factors go into the pricing of FedEx routes for sale. Add to that: the market is constantly changing! Most FedEx regions of the United States are seeing substantial year-over-year growth. Finally, we know that contractors are in varied stages of ISP transition, plus operations are moving to new 6 days per week schedules.

The rate of change and transition can be dizzying. This is why it's critical to use an experienced FedEx broker (with actual contracting experience) to price your route.

Understand FedEx Route Financials: Profit Margins, Financing Options, and More!

Here are the financial highlights from our industry overviews this year. We focused on content this past year on giving you as much insider information as possible—especially information on the financials of buying a FedEx route. We resurface ideas such as: look for P&D businesses with profit margins between 15 and 20% of revenue; potential buyers often turn to bank financing to purchase FedEx routes; one strategy for acquiring sufficient down payment funds is to reduce the loan amount via seller financing; and have a deep understanding of the charges you will negotiate in your ISP contract.