Ground owners get ready to drive again
- Thread starter Working4the1%
- Start date
I once was making a delivery to a rural area when ground, home, and express were all in separate terminals, and this delivery was over 50 miles from the HD terminal in a small town along the interstate,, and about 12 miles outside the small town out past 2 lakes, and all three service were making deliveries at the same place- one to a small business run on the property, and two more to the campground store. . Even now, I will occasionally get an express and a ground driver, or ground and HD driver making deliveries to my house on the same day,. Express and ground have small terminals in town, but the HD terminal is still over 70 miles away. HD could send one truckload early each day to the local ground location for at least a little efficiency, but instead they send multiple drivers, each with a 140 mile roundtrip to be paid for, while having both express and ground drivers(already inefficient) already covering all the same areas.
The inefficiencies of the multiple divisions alone is part of the reason why UPS can afford to pay more. 3 trucks with three drivers, and all the fuel and maintenance, and insurance, and payroll taxes is possible a little more expensive than servicing the area with one larger vehicle, even if each UPS driver covers a smaller area.
McFeely
Huge Member
How many days was each package in transit though? Ground can be 3-5 days where the Express package could have been sent just 1 day ago.
True
My first month starting at ground I delivered to a hospital and all 3 of us were in the parking lot at the same time. The Walmart lady used to get pissy with me because she was tired of dealing with all the fedex guys every day. HD + ground + express + freight. One day she was like "I wonder how much fedex spends on gas" Now they want to send out 2 express drivers every day? On paper one does p1 stops and the other does everything else but on paper ground was supposed to do businesses while HD did residential and that clearly didn't work.
I am being nice to them by trying to keep them from falling into a false sense of security. Sure, they could come away with a nice payoff in the end or they could come away with nothing more than the salvage value of their trucks which wouldn't be much. Both outcomes are in the hands of someone other than themselves. And so the question is how much of your personal wealth do you want exposed to that particular fate and circumstances?
Fred's Myth
Nonhyphenated American
Jilted bride advising the happy housewives! SMH
Working4the1%
Well-Known Member
Cedar Point to pay workers $20/hour
Amusement park needs thousands of summer workers
It's about having too much of your net worth in one area and exposed to outcomes you have zero control over.
Right now I have approximately 55 different trading positions in 2 different brokerages and spread across multiple sectors of the economy.
Am I wealthy? Not really. But I don't have to go out and work a job unless one comes a long that I would find interesting.
For an individual to put such huge sums of their own net worth at risk with the full and complete knowledge that it will have no voting
rights , no seat at the board table no representation of any kind..... If it works out for them fine...but if it doesn't they have nobody to blame but themselves.
There is something I have they don't . I can at least vote my shares and can easily trade out of any one of those positions. For contractors, especially those getting up in years, their future well being will be based on whether or not they'll go away wealthy of go away broke but whichever way it goes both decisions will be made by someone other than themselves . A person who acts in his employer's interests and no one else's.
It will be fine
Well-Known Member
You do know successful contractors make money every year, right?
I never said they didn't make money. It's about having too large a share of your net worth assigned to one area and the fate of which is fully exposed to numerous forces none of which the contractor has any control over.
Then will come a point in time where every contractor's advancing age requires them to divert more of their earnings into other areas rather than to continue to pour it all back into continued expansion even if Fat Freddy demands that you do so.
It will be fine
Well-Known Member
Why do you believe any successful contractor is pouring their own money into their operation?
You may not even have the scrap value of your trucks if you borrowed to buy them. You could lose everything PLUS still need to pay off the vehicles. And if you paid cash for the vehicles, you might be worse off by having more of your net worth at risk. There are people around still paying off debt they took on just to buy the 'contract' not even considering the vehicles. You have NO right to a renewal of the contract, no matter how many trucks you have or how much you paid. I believe in buying only assets with intrinsic value rather than speculative value.
If I told you that I plan to borrow another $500k in the next 5 years above vehicle purchases, you’d think I was crazy, no? I guess it all has to do with what people are comfortable with in investments.
To me, $500k doesn’t feel like a crazy amount because considering the changes coming, a practical selling price may realistically approach $10 million.
But if all you see is the day to day headaches, there’s really no way to see through to the potential.
It will be fine
Well-Known Member
I’ll try to go slow. A successful contractor doesn’t need to pour money into their operation. The revenue the business makes covers the cost to operate and there’s even a surplus that is known as profit.
Spot on. No guaranteed renewal. 1 year deals only. Proprietary rights exists only for as long as Ground is willing to extend them. Very low percentage chance of recovering loses through litigation. I don't know where bsam gets this 10M dollar payoff number because these days of the contracts on the sale boards and there are more of them than in the past only about 1 out of 10 contractors are asking for volume.
Again, Ground has made it abundantly clear and has repeated it many times.... They are not in the business of creating equity or building enterprise value for third parties. Their first priority is creating value for their shareholders and they will always come before some little third party box contractor tagging along behind picking up after them.
Because your only conception is from 15 years ago, not 5 years from now.
3 months ago, guy had his for sale at $1.5 million. 3 days later had an offer of $1.2 million. Turned it down. Second offer at $1.5 million. Decided not to sell.
As I’ve said before, the timetable has accelerated.
I take that as accelerated departure because the band's playing it's last song.
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