Overlap plan

[OrioN]

And don't forget the homemade bridges built out of 2x6's if your lucky that they used 2x6's instead of 2x4's . This is why you leave the heavy haulers in town and put the fast movers with off road capability out in the jhing weeds.

Geezus, what 3rd world country of USA is this?!?

At least in my area, they use wood railroad ties since most newer tracks have concrete ties now?

 

[bacha29]

Geezus, what 3rd world country of USA is this?!?

At least in my area, they use wood railroad ties since most newer tracks have concrete ties now?

I've come across bridges like I described in the earlier post. One was simply too weak to drive my vehicles over so i called up and made the consignee drive his truck over it to get his box. His response...."Well the other day we had a loaded triaxle drive over it". My response....."Pal all I want to know is who designed it who built it what's it rated for and who certified those results"? It just molested his mind.

 

[Cactus]

Office environment huh? Pal you are about as far removed from an office environment as you can get. Typical morning. You walk into the place and what do you find on many a morning. Guys call off or never called at all. You can't get a hold of them because they're in jail for beating up the old woman and oh by the way they got picked up for DUI a week earlier and never told you. I even had a guy who had the cops come in and pull him out of the truck because he didn't go to a court ordered divorce hearing.A short time ago the guy who bought me had a female driver called in for a random but never went.The inbound trailers are late. You have a new preloader who doesn't know what goes on your truck or where and the motor freight they stole off the LTL's simply rolled down onto the floor between the trucks where it gets soaked by the snow and ice that melted off the truck. Looking around some more and you see a puddle of green liquid from the hole in the radiator punched into it by a rock or a deer strike. Now the damn thing won't start because of a short in the battery or starter or an alternator that had been slowly failing and shorts in step vans are a major problem because of wire chaffing. And don't forget the tire that had been slowly going flat overnight because of the nail it picked up the day earlier.
Now you finally get underway and hopefully manned by someone who knows a little bit about the area can keep up with the work pace required and hopefully doesn't have to try to service an area the size of most European nations and if all goes well he doesn't get himself or somebody else killed out there.
Then you go into the office and have to deal with the customer complaints. misdelivered boxes, and God knows what other issues along with the random drug tests driver turnover peak season manpower procurement etc, etc. These are just a few of the daily headaches, solving them is all on you and this is only just the morning
And as IWBF pointed out, you're only going to get just so much money out of X and based on what they think should be the cost of running that route. And rest assured it will be based on the lowest estimate.
Still think this is something you want to do? Then leave your Armani suits and Gucci shoes in the closet , climb into your Carharts and grab you tool belt.

Yeah, I think you nailed it. Fred & Co. are always looking for some sucker to do all the dirty work.

Our newest contractor came from the Chicago Stock Exchange. He's happy with the ROI and recently acquired an operation 2 hours away. Yes

Yeah, happy now. Wait 'til reality comes a callin'. Give him a month.

 

[bbsam]

Yeah, I think you nailed it. Fred & Co. are always looking for some sucker to do all the dirty work.

Yeah, happy now. Wait 'til reality comes a callin'. Give him a month.

He’s been here for two years

 

[Cactus]

He’s been here for two years

Give Pittsburgh time. They'll make him unhappy eventually.

 

[bacha29]

Give Pittsburgh time. They'll make him unhappy eventually.

The guy will continue to do fine until his supply of cheap and disposable labor is exhausted or has had his fill of rate cutting and uncompensated XG mandates . Whichever comes first.

 

[NYCFXG]

Ha ha that's funny bbsam. I guess there is some math guy like me sitting in a corporate office who setup a algorithm based on futuristic projections, which definitely does not consider the impact of everything that happens in real life. I guess I can set myself up for a job in fedex quant analysis and find you the answer

Did you say you were a guy from Wall Street? If that's the case how are you buying PSA routes? I just sold my routes. Message me. I can help you with anything you need. But, I don't think you should be doing this right now.

Overlap is about to demolish equity in the business. 100k HD route and 100k Ground route in same zip is now worth 125k combined. Think about that. We saw the first major contraction with ISP. This will be the last major one.

If you are truly deadset on doing this. You should wait. Seriously, wait. There is no hurry. There is about to be a WHOLE lot of frustration and aggravation that you are buying into for no reason. The market is about to change drastically in 2 years. Let the dust settle.

 

[dvalleyjim]

FedEx must love always changing the playing field and watching the ISP's jump through hoops. Wow, This can only improve their already one-sided negotiations. And once you have dumped your money into it you will still have to negotiate every year. Add to this they will continually change the rules on you. This would be ok if they would fairly compensate you for the risk! On the other hand, you don't have to get customers and pretty much know how much you will make every wk.

 

[dvalleyjim]

The guy will continue to do fine until his supply of cheap and disposable labor is exhausted or has had his fill of rate cutting and uncompensated XG mandates . Whichever comes first.

This could be a problem if the economy takes off and employers finally have to compete for workers. FedEx will be slow to react and at first make it the ISP's problem. FedEx is giving raises and bonuses to employees but the ground and HD drivers will not see this. Add to this no hourly pay, lunch or beaks, and no benefits. This could be a disaster looming that the ISP is not aware of. Really, nothing you can do. Just suck it up. Add to that, some predict a 3-5% growth this quarter, peak volumes could occur.

 

[bacha29]

FedEx must love always changing the playing field and watching the ISP's jump through hoops. Wow, This can only improve their already one-sided negotiations. And once you have dumped your money into it you will still have to negotiate every year. Add to this they will continually change the rules on you. This would be ok if they would fairly compensate you for the risk! On the other hand, you don't have to get customers and pretty much know how much you will make every wk.

Good points. As long as it's X's freight and while it may be your truck it's their DOT number on the side of it as long as those 2 conditions exist the will be all that matters.
And now Amazon has announced that it's setting out to become a full fledged common carrier and when he goes nationwide life for a X contractor will likely get worse until the X contractor is presented with a counter offer from Amazon.

 

[NYCFXG]

Good points. As long as it's X's freight and while it may be your truck it's their DOT number on the side of it as long as those 2 conditions exist the will be all that matters.
And now Amazon has announced that it's setting out to become a full fledged common carrier and when he goes nationwide life for a X contractor will likely get worse until the X contractor is presented with a counter offer from Amazon.

Daily Stop Thresholds are important when dealing with runaway growth. I renegotiated my contract three times in under 16 months. The single most important number is that threshold. If it wasn't for me paying attention to it and keeping it as low as I could feasibly negotiate. I would not have been able to leverage them into a new contract each time I started eclipsing it.

In regards to Amazon, I was intially excited about the proposition of being approached by Amazon to contract work. But after hearing their pitch, they are even more delusional than X. They are going cheaper than Lasership.

 

[Cactus]

FedEx must love always changing the playing field and watching the ISP's jump through hoops. Wow, This can only improve their already one-sided negotiations. And once you have dumped your money into it you will still have to negotiate every year. Add to this they will continually change the rules on you. This would be ok if they would fairly compensate you for the risk! On the other hand, you don't have to get customers and pretty much know how much you will make every wk.

This could be a problem if the economy takes off and employers finally have to compete for workers. FedEx will be slow to react and at first make it the ISP's problem. FedEx is giving raises and bonuses to employees but the ground and HD drivers will not see this. Add to this no hourly pay, lunch or beaks, and no benefits. This could be a disaster looming that the ISP is not aware of. Really, nothing you can do. Just suck it up. Add to that, some predict a 3-5% growth this quarter, peak volumes could occur.

All in all, a real crappy deal that only gets crappier with the passing of time. So when's the bottom gonna' fall out?

 

[Knowledgeseeker]

Thanks guys. I did decide that it was too much going on at the moment and the seller had somebody who was ready to buy as is so he sold out. I will now wait and see if something else shows up. Thanks all for the great advice.

 

[bacha29]

Thanks guys. I did decide that it was too much going on at the moment and the seller had somebody who was ready to buy as is so he sold out. I will now wait and see if something else shows up. Thanks all for the great advice.

We simply tried to prepare you for what you were getting yourself into and the issues you would have to resolve on a continuous daily basis to the satisfaction of XG and that isn't easy. If the buyer you speak of is just another one of the people who think that all they have to do is to simply buy out the contract then just sit back and count the money it won't be long until he gets tired of throwing money at it cuts his losses and gets out under whatever terms the new buyer will offer. You might have done fine at this endeavor if you were prepared in advance.

 

[STFXG]

Send the buyer our way so we can all call him an idiot.

 

[deve]

Overlap is about to demolish equity in the business. 100k HD route and 100k Ground route in same zip is now worth 125k combined. Think about that. We saw the first major contraction with ISP. This will be the last major one

Why do you think transition to full overlap will destroy equity ?
We have been on ISP contract for a while here in California. When we trade routes to achieve overlap in our territories, our weeklies and stop rates seem to get adjusted properly by FX based on new stop count and I am yet to see revenue disappearing when you combine revenues of all entities involved into trade. I am still relatively new to FX though. Am I missing something?
Maybe you suspect FX will change contract and all of the sudden they will start paying less for the same density/stop count after 2021 ?

The only thing I might suspect is that HD guys might lose in more cases while Ground gain while achieving overlap since Ground guys acquire more density while getting the same area.

 

[NYCFXG]

Why do you think transition to full overlap will destroy equity ?
We have been on ISP contract for a while here in California. When we trade routes to achieve overlap in our territories, our weeklies and stop rates seem to get adjusted properly by FX based on new stop count and I am yet to see revenue disappearing when you combine revenues of all entities involved into trade. I am still relatively new to FX though. Am I missing something?
Maybe you suspect FX will change contract and all of the sudden they will start paying less for the same density/stop count after 2021 ?

The only thing I might suspect is that HD guys might lose in more cases while Ground gain while achieving overlap since Ground guys acquire more density while getting the same area.

I have assisted in negotiating 4 contracts that were new overlaps. Every single one had to fight tooth and nail just to get back to equilibrium. There is an ignorance about the supposed benefits of overlap. None of our buildings have co-lo yet. However, X is negotiating as if they are. So, these guys are getting crap contracts as if they were running in the same terminal but need to have a manager in each or have a manager in one. They have to split their spares and sometimes are 20-30 mins away from their other terminal.

The point I made about loss of equity is simple. We lost equity value with ISP because you can't sell routes to an owner operator. Each route used to have a much higher earning potential for the buyer and therefore got a higher resale value. With the next move (overlap), both segments think their routes are worth 100k but when they are combined they aren't going to be worth 200k. They will be worth less. Loss in equity, 6 day a week business, etc. etc. This is a lose for the contractor and a benefit to X.

I got out. I am happy I am out. I see a lot of broken hearts in the near future. Much bigger losses are incoming for contractors with overlap. Where maybe it was a few single truck or two truck guys losing their routes... there will be 5-6 route guys losing their contracts for the sake of overlap.

 

[bacha29]

I have assisted in negotiating 4 contracts that were new overlaps. Every single one had to fight tooth and nail just to get back to equilibrium. There is an ignorance about the supposed benefits of overlap. None of our buildings have co-lo yet. However, X is negotiating as if they are. So, these guys are getting crap contracts as if they were running in the same terminal but need to have a manager in each or have a manager in one. They have to split their spares and sometimes are 20-30 mins away from their other terminal.

The point I made about loss of equity is simple. We lost equity value with ISP because you can't sell routes to an owner operator. Each route used to have a much higher earning potential for the buyer and therefore got a higher resale value. With the next move (overlap), both segments think their routes are worth 100k but when they are combined they aren't going to be worth 200k. They will be worth less. Loss in equity, 6 day a week business, etc. etc. This is a lose for the contractor and a benefit to X.

I got out. I am happy I am out. I see a lot of broken hearts in the near future. Much bigger losses are incoming for contractors with overlap. Where maybe it was a few single truck or two truck guys losing their routes... there will be 5-6 route guys losing their contracts for the sake of overlap.

Happy to hear that you managed to get out under the best terms you could hope to get
Back in the days of the single route contractor he could call it quits almost on the spot walk away and lose little if anything at all. Today however they've got many if not nearly all who remain in a position of drastically reduced maneuverability and far fewer options and now with most class action law suits settled they're likely to become even more emboldened. Ground has always been a very poor setup to begin with and a very poor place to try to create wealth. To Ground's credit they never tried to hide the fact that creating equity for contractor's was never the intent. Yet some people just can't get that in their heads.

 

[NYCFXG]

Happy to hear that you managed to get out under the best terms you could hope to get
Back in the days of the single route contractor he could call it quits almost on the spot walk away and lose little if anything at all. Today however they've got many if not nearly all who remain in a position of drastically reduced maneuverability and far fewer options and now with most class action law suits settled they're likely to become even more emboldened. Ground has always been a very poor setup to begin with and a very poor place to try to create wealth. To Ground's credit they never tried to hide the fact that creating equity for contractor's was never the intent. Yet some people just can't get that in their heads.

I was a huge beneficiary of ISP and risk taking. I had access to credit and capital. It allowed me to expand and manage the risk I took while controlling my budget. I was always a good payer (the best I could) and held a decent core group of guys. I would hire around them. In the span of 39 months my original investment more than tripled, while also making between 18% and 22% returns during that period through operations.

I would never, ever do it again. I would never recommend it to anyone. It was an absolutely brutal 3 years and I learned a lot. It took a toll on my family, relationships and physical/mental health.

 

[bacha29]

I was a huge beneficiary of ISP and risk taking. I had access to credit and capital. It allowed me to expand and manage the risk I took while controlling my budget. I was always a good payer (the best I could) and held a decent core group of guys. I would hire around them. In the span of 39 months my original investment more than tripled, while also making between 18% and 22% returns during that period through operations.

I would never, ever do it again. I would never recommend it to anyone. It was an absolutely brutal 3 years and I learned a lot. It took a toll on my family, relationships and physical/mental health.

Let's put it another way......People have shot themselves for less.