We started with a route and supplement. Not 2 PSA's. We partnered with another single contractor as 2 PSA's were minimum. Everything was fine, settlements WERE easy to read and self explanatory per truck or I should say WA (work area). Other partner decided to sell, we did not want his route but fortunately for us, we were able to combine routes with someone we knew from HD. The problem with that was that the money was paid into one account, the HD contractor. We received all our monies but he knew our business so if your private, forget about it, your partner will know your business. A few years after that we purchased 4 PSA's and 2 sups with it so now we are on our own, no other partners and we have a full time manager so i rarely get the phone call. However, the 3 years prior we had 3 different drivers quit or they weren't cut out for the work. In a 6 month span I had to take 3 months off work to train the various new drivers, this job is NOT for everyone, especially if heavy volume. Lucky I have my own business and can somewhat make my own hours so it did not affect me a whole lot to a certain extent.
Your success will be determined by the relationships you make. Be humble and realize that you may be the new dog in town if you move forward. Our contract was just renewed end of July, I have no idea when everyone else's from other states is renewed. Again, my advice, find out how many other single contractors are in your station, befriend them as you may need to partner with them if Fedex changes there model. It had been my experience regardless of what others may say, that they are somewhat tolerant and reasonable and they will not come to you and say you need a partner next week. You will have some time to make changes if need be. Is it a perfect system, NO, but what is.
I understand what your saying about not having another driver on payroll, trust me I get it. My saying this was and IS a insurance policy for your business, an insurance policy to cover your 140-160k investment, thats all. I think you understand this and I am sure any other contractor would agree with me.
1.5 net earnings is the general rule of thumb for business valuations plus assets. Are you financing or paying cash. Cash is king and you should get a discounted rate if so. I am still having some problems computing your figures. 145 gross and 119 net. Are your taking the net directly off the settlements?????? We used to have a gross and then our net showing on our settlements. I am just trying to figure where the 119k is coming from. Is a schedule C being filed if not incorporated yet? Have you seen the schedule C ? is the schedule C showing 119k before personal deductions?
We are currently looking at another PSA right now and gross is as i recall is 128k, contractor is selling for 90k and comes with a 2009 p1200. PSA's are generally selling between 80-100k here and at other stations as well, they don't come up very often but that seems to be the general norm. Our first PSA and Supp we purchased for 110k and it grossed exactly 144k.
Lots of info to digest but don't be scared, not my intention although others may disagree. We are growing and getting busier. If your terminal does have floaters, do they know your route.? Who pays for them? Is it pooled by other contractors? Do you have to schedule the floater way in advance? How many are at the stations disposal? Where is your route on the food chain if there are 3 floaters and 4 guys show up sick. The reason I ask is because I don't care how good you think you are, you get put on a route with over 100 stops you have never done before and welcome to DNA (did not arrive) city. Then when you come back next day, you have your daily inbound volume plus whatever the floater was not able to deliver, now you have 160 stops, LOL. I commend you for coming to this forum and asking questions. Not sure what states require a minimum of 3 but know our sunny west coast state only requires a minimum of TWO. Knowledge is power.