How much does it cost to buy a FedEx route?

Photo by Sid Verma

Thinking about buying FedEx routes for sale?

You probably have financial questions.

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.

If you plan to finance your route, you should expect to make a minimum down payment of 10-25%—this is fairly standard in the industry. (The terms and ultimate cost of your financing can vary depending on your credit history and whether you seek a loan with an SBA or through a conventional bank.)

We do recommend keep upwards of $50,000 of additional liquid funds on hand as working capital. A line of credit could suffice for these purposes as well.

For a lower priced route you will need approximately $80,000-100,000 available for a down payment. An average priced FedEx Ground route for sale will require a down payment around $150,000-200,000, plus working capital. Higher cost routes, like our premier linehaul listings, may require down payments in excess of $1,000,000.

There are strategies for acquiring down payment funds if you, personally, do not have sufficient cash on hand. For example, some FedEx Ground route buyers seek down payment funds from friends and family. Or, they find silent partners/investors.

Another possible strategy for reducing your upfront cost burden is seller financing. A FedEx Ground route deal with seller financing means that the seller essentially loans you part of the cost of your purchase and you will pay back the seller this portion of the price (usually with interest). A bank will typically view the seller financing as part of the down payment, reducing your personal burden.

Be aware: if you use extensive financing (whether SBA, conventional, seller, or a combination) you may have hefty monthly debt payments. It’s critical that you review an amortization schedule to ensure the cost-benefit of each route works for your circumstances. If you need help discussing this, our team is available for consulting.

So what’s next?

Narrow down your target route price. Once you understand your best financial route forward, you can be a better prepared buyer. If you’re already this far along in the process, we recommend learning how to distinguish yourself as a buyer so that you can compete and secure the best listing for you.

If you can’t find exactly what you’re looking for in our Active Listings, tell us what you’re looking for. Not all of our listings go public. At times, we connect buyers and sellers behind the scenes if we find the right fit. If you have specific criteria, we’d love to know more about it so we can help you in your route search.