The Route Experts Team
Total Business Service Solutions, Inc.
At FedEx Ground, nearly 4,000 independent contractors - nearly half of the entire contractor network - earn annual gross revenues in excess of $200,000.
How? Through the initiative, hard work and business management skills of their people.
FedEx Ground independent contractors are paid by results. The majority of contractors earn gross revenues ranging from $150,000 to $350,000, with some multiple route contractors grossing more than $1 million.
The top 2,000 FedEx Ground independent contractors averaged $370,000 plus in gross revenue.
Nearly 400 FedEx Ground independent contractors grossed over $500,000.
More than 100 FedEx Ground independent contractors grossed more than $1 million. The top 10 FedEx Ground P&D and FedEx Home Delivery contractors averaged more than $1.9 million.
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Simply put, FedEx Ground enters into contracts with independent small businesses to provide pickup and delivery services for the company. A FedEx Ground independent contractor:
- Owns or leases its delivery vehicles
- Establishes and maintains customer relationships
- Employs personnel and fulfills all employment-related obligations, such as wages, employment taxes, and benefits
In many cases, contractors own multiple vehicles and employ a sufficient number of personnel to service each area. Contracting with FedEx Ground can be a win-win-win arrangement for independent small businesses, as well as FedEx Ground and customers.
FedEx Ground will contract only with entities that are:
Established under state law as corporations,
are registered and in "good standing" with the state(s) in which they do business, and ensure personnel who provide services under the Operating Agreement are treated as employees.
Contractors are obligated by the terms of their Operating Agreements to obtain FedEx Ground’s prior consent to a PSA transfer. When acquiring a service area, the purchase or sale price of a service area is determined by the buyer and seller without involvement from FedEx Ground; however, both parties must receive FedEx Ground’s consent to the assignment before it can be completed. Parties that have acquired businesses already under contract with FedEx Ground have found it useful to analyze – among other factors – the business's historical revenue over time, geographic service area(s), service history, safety record, liabilities, claims history, compliance history, vehicle maintenance history, vehicle registrations, insurance, and the terms and duration of Agreement(s) already in effect.
As part of the assignment process, an acquiring contractor will need to submit a response to FedEx Ground’s Request for Information, providing background information, customer service approach, safety history, and other information. This response will help FedEx Ground determine if the contractor is capable of achieving the contracted-for results.
FedEx Ground understands that parties interested in becoming an independent contractor for FedEx Ground may choose to use a broker to facilitate the transaction. For your protection, consultation with attorneys, accountants and business valuation specialists may also be appropriate.
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