Ok...so were going under...

Discussion in 'FedEx Discussions' started by fedupped, May 25, 2013.

  1. fedupped

    fedupped Member

  2. MrFedEx

    MrFedEx Engorged Member

  3. DontThrowPackages

    DontThrowPackages Well-Known Member

    So, if Apple's IPOD profits get to 1pct but their IPAD is at 95pct, does than mean Apple slashes employee's pensions, cuts hours and freezes pay raises?
     
  4. bbsam

    bbsam Moderator Staff Member

    Well would you build another Ipod factory or Ipad factory?
     
  5. DontThrowPackages

    DontThrowPackages Well-Known Member

    Both make up the Apple company. Building another factory would make no sense. It would be like McDonald's creating a separate facility to make Big Macs. Besides, I guess Apple was a bad company to use as example. We all know how well their employees are treated over inside the Plantation that is Foxconn. But then again, it could serve as a good demonstration just how far companies will go, in treating their workers, to make so much money. Anti-suicide nets lol.
     
  6. bbsam

    bbsam Moderator Staff Member

    The point is where would you place your investment money. Sure, you keep building the iPod to remain competitive, but the R/D goes into the iPad. That's where the return on investment is going to be the greater st.
     
  7. bbsam

    bbsam Moderator Staff Member

    Which brings me to a question. If Express did pay better wages and benefits, would they even be profitable? Seems the margins are awfully thin.
     
  8. Cactus

    Cactus Just telling it like it is

    there's many a bloated salary at the top or haven't you been paying attention?
     
  9. fedupped

    fedupped Member

    FedEx: Great Company Good Price - Seeking Alpha

    FedEx Express accounts for 62% of FedEx's total revenues and this business segment's revenues are an almost even mix of Domestic (United States) and International business (52% and 48% respectively)

    FedEx Ground comprises about 21% of FedEx's total revenues and is North America's second-largest ground-based package delivery service.

    So, if you want to downsize your company by 62% then put your money in the ipad. Could ground take expresses share of overnights and get them off on time. No. Would the business sector who need documents on a daily and timely basis to keep the financial sector and economy going stay with a sometimes next day service , sometimes morning, mostly late day service. NO. Dont believe all the crap. Express is the lifeblood of this company. Would you rather have 10 % of 1,000,000 or 1% of 1,000,000,000. That is ground versus express.
     
  10. vantexan

    vantexan Well-Known Member

    But businesses who use Express for 2 and 3 day are recognizing the savings they could realize by using Ground. And they are figuring out that Ground can get pkgs delivered overnight within their local service area, which would realize huge savings. So look to see Express continuing to shrink, Ground continuing to grow. And FedEx will encourage this because while Express might generate 62% of the revenue, they aren't as profitable per pkg as Ground is by a long shot. And profit is what it's all about.
     
  11. bbsam

    bbsam Moderator Staff Member

    Or you could just change the business model at Express.
     
  12. vantexan

    vantexan Well-Known Member

    If it were possible to do under current laws and regulations, and made FedEx more money to do so, it would've already happened.
     
  13. bbsam

    bbsam Moderator Staff Member

    I don't think so. They have to make sure they have the right system with the right people and has to be a big enough profit.

    Think about the bottom line. How much does Ground save over Express? Now suppose switching to a contractor model at Express (or as much as possible). Say Express loses alot of business due to that change. Lets say 7%. That's alot of money. But if they save even more, does it matter? If Express'margins continue to dwindle due to lack of demand or a concerted effort by couriers to slow down, imagine how quickly this could take shape. Do you really think Memphis hasn't explored and paved this avenue as a viable option?
     
  14. Cactus

    Cactus Just telling it like it is

    Kool-Aid poisoning.
     
  15. bbsam

    bbsam Moderator Staff Member

  16. vantexan

    vantexan Well-Known Member

    I don't see how my answer isn't valid. If they were allowed to treat Express like Ground, with lower paid employees with no benefits, they would have done so already because the profits would be huge. And most likely this forum wouldn't exist, at least for Express employee participation.
     
  17. bbsam

    bbsam Moderator Staff Member

    It's a high-risk, high-reward proposition. Mitigating the risks is difficult but not impossible, but I don't think it's prohibited.
     
  18. MAKAVELI

    MAKAVELI Well-Known Member

    It's not valid because the amount of " control" it has to have on daily op and drivers is not possible with a contractor scam. I'm sure they have entertained the thought, and probably have wet dreams about a contractor scam at Express. But that's as far as it goes. Bottom line is if they could they would have already.
     
  19. bbsam

    bbsam Moderator Staff Member

    If Express' bottom line drops to -3%, other bottom lines will change as well.



    By the way, your "degree of control" argument should be researched if you intend to use it. Courts are rather supportive of companies.
     
  20. vantexan

    vantexan Well-Known Member

    It's my understanding that from pick up of the pkg until it arrives at it's destination ramp(we've discussed this, it's where it comes off the plane) it must be handled by company employees. Not contractors or their employees. If they want to make employees do pickups only with Ground type contractors handling all deliveries then it's possible as long as customers understand that. But if that was in the works then why try to implement DRA? Not to mention it would require a huge amount of hiring of contractors and their drivers beforehand. Unlikely many Express couriers would be willing to be Ground type drivers with a pay cut and no benefits. Not to mention there's already alot of debate over misclassification of employees as contractors. Imagine the controversy if FedEx tried to convert employees to contractor employees. Might blow up in their face, may lead to ending the RLA under closer scrutiny.