In our experience, the salaries and wages (payroll) in a FedEx Ground route business cost between 40 and 50% of total business revenue. This is the largest line item expense in your profit and loss (P&L) statement. It’s no wonder then that many prospective business owners want more details about how drivers get paid.
In September 2018, FedEx Ground announced its US operations would convert to a 6-days-per-week schedule following the holiday season.
That change is upon us now!
A couple new things to note as you work through the transition with your own FedEx Ground team.
Businesses of all types benefit from economies of scale. FedEx route businesses are no different. As you increase the number of routes in your businesses you are able to spread out your expenses more efficiently.
For example: each truck you add to your operation decreases per truck costs.
We talked extensively in past posts about the risks of FedEx linehaul routes. Now, let’s get into more detail about the rewards!
There are two distinct types of FedEx businesses: pick-up and delivery (P&D) routes or a linehaul run.
Linehaul runs are a lucrative and risky business. Some contractors say linehaul runs are 90% boredom and 10% terror. But they can be an incredibly profitable investment for the right contractor.
Are you the right contractor for a linehaul run?
For Independent Service Providers (ISPs), Independent Contractors (ICs), and linehaul operations, FedEx offers bonuses to contractors that go above and beyond.
Bonuses can add a substantial amount to your overall revenue each year. Whether you are an existing FedEx contractor or looking to buy a FedEx route, obtaining contractor bonuses should absolutely be part of your financial goals and strategies.