Owning and Operating a FedEx Ground ISP

LastMile

Member
Calling all FedEx Ground ISPs, Route owners and Contractors to share from their experience...

I recently discovered this forum as I was doing some due diligence to become a FedEx Ground ISP of 10 routes in the Seattle area. I would be a silent owner and the business would be run by a full time manager.

Since this is primarily an operations business, there are hard costs associated with
every task / step in daily processes. Having a background in software technology,
I am trying to understand if and how, as an ISP, I can automate some of the daily tasks to reduce our costs and operate more efficiently. Specifically:

- reduce exceptions for daily deliveries
- avoid introduction of human errors
- minimize wastage such as fuel & time
- conveniently track & monitor daily operations

Would appreciate your feedback on the following questions.

1. How do you ensure that your daily inbound deliveries for any work area will fit in
your truck servicing that area?

2. What happens if the total delivery load exceeds your truck capacity?

3. Do you get to re-balance the excess deliveries across other trucks which have capacity? If so, what steps do you take to make this happen?

4. Is there a general efficiency rule that your drivers follow at a delivery stop (for e.g amount of time spent at each stop or how many packages per stop etc)

5. Failed first attempt deliveries seem to cost an ISP. Roughly how may of these do you get everyday? How can you minimize these?

6. What issues do you see coming when Ground and HD deliveries will be co-mingled across work areas?

7. How do most drivers get paid? By the hour/day/week? By stops/packages?

8. How often do your drivers forget to make pickup stops, either scheduled or call-in? Do you feel pick-up reminders to them would be helpful to avoid such failure?

9. As an owner / manager, I would like to see in real time, where all my trucks are and what the delivery + pickup status is for each. As an owner, how do you do this?
 

dmac1

Well-Known Member
As long as you are aware that Fedex can unilaterally cancel the contract with no recourse for you, if they decide to change the delivery model. Or for something that they don't consider as acting in a 'professional' manner, or other undefined terms that they always interpret to their benefit. Sit down with an attorney, go through the contract word by word, verify the legal interpretation of all terms, or if there are things that could mean various things- get fedex to define it in writing. I don't know if it is still in the contract, but there used to be a term- something like 'fedex wants to make full use of contractors vehicles' where you might think it is 8 hours a day, and fedex says it is 14 hours or more per day. Terms like that caused a lot of problems a few years back. Fedex may have fixed it.

And think about the coming raise in minimum wage. Will you be able to get good workers if they can find less demanding work for about the same pay. Sure you can hire monkeys to deliver if they have driven a similar vehicle, but getting good help is going to be the hardest part of controlling your costs.
 

bacha29

Well-Known Member
If I understand you correctly, you say that your background is in software technology. If that is the case than you cannot possibly be more unsuited to be an X contractor. Why? Because one fact stands out when it comes to that so called " operating agreement"........NOTHING"S BINDING! If you believe that all you have to do is to sit back prop up your feet and collect the money while that little box on your desk solves all of your problems....then man are you in for the shock of your life. As dmac1 pointed out with the heavy downward pressure on settlements currently ongoing then by all means learn every aspect of all 10 routes because as sure as the sun comes up in the morning you're going to be driving them as some point in time. Also as he pointed out. your success is entirely dependent on your ability to find drivers who show up every day and deliver top of the scale performance for bottom of the scale money.As X plainly stated the entire initiative has nothing to do with creating equity for contractors but rather to acquire trucking and labor at the lowest possible cost.
 

bbsam

Moderator
Staff member
It seems to me that the OP is somebody in FedEx. The wording is too concise to be someone looking for answers before investing. Reads like it came straight from an MD's laptop to SM's email to go over with their CSP's.
 
Last edited:

LastMile

Member
dmac1 & bacha29: I understand what you are saying and plan to review the contracts in detail with my attorney. Appreciate the head up notes.

bbsam: Really!! I am an entrepreneur. Would a FXG management have a gorgeous profile picture like mine. Don't think so :->

Seriously guys, as part of my due diligence, all I m trying to understand is where and how I can apply my competitive advantages i.e using technology to reduce errors and costs so as to be able to run the operations efficiently and target higher operating margins.

I am new to the forum and new to the FXG delivery business domain so not sure what the expectations are or what the forun etiquette is. Will be happy to oblige though.

Hopefully some of you can help me answers to my questions.
 

bbsam

Moderator
Staff member
Sorry Last Mile. I'm not buying it.

"How do you ensure..."

"Co-mingled"

"How can you minimize these"

"What steps do you take to minimize these."

"...exceeds your truck capacity..."

"...would be helpful to prevent such failures...?

Everything you post is centered around how the ISP is to service FedEx. And that's fine. But nothing, NOT ONE QUESTION about whether the company handles complaints fairly or controls workforce or inspects vehicles or DQ's drivers or their joke of an appeals process and their even more hysterical negotiations? Not one question about any of that and you would have us believe that you have done "due diligence"?

Lol. No, Lastmile. I'd say you're up to something else and that's fine. But you seem to be FedEx corporate or you are their wet dream come true. Nothing wrong with either and I hope you find the answers you are looking for. Just remember, there are a lot of questions you aren't asking.
 

It will be fine

Well-Known Member
dmac1 & bacha29: I understand what you are saying and plan to review the contracts in detail with my attorney. Appreciate the head up notes.

bbsam: Really!! I am an entrepreneur. Would a FXG management have a gorgeous profile picture like mine. Don't think so :->

Seriously guys, as part of my due diligence, all I m trying to understand is where and how I can apply my competitive advantages i.e using technology to reduce errors and costs so as to be able to run the operations efficiently and target higher operating margins.

I am new to the forum and new to the FXG delivery business domain so not sure what the expectations are or what the forun etiquette is. Will be happy to oblige though.

Hopefully some of you can help me answers to my questions.
Unfortunately this forum is mostly disgruntled fedex workers, so most of the input will be negative. A lot of your questions will be dependent on your staff.
Every night you can run a projection of what's coming. This includes cubic feet, so you can see if a bulk stop is huge boxes or envelopes. If all your routes are contiguous you can move stops between them after you run the projection. You just send an email telling the preload where to move it.
Some people pay by the stop/piece others are salary. There are benefits to both. Stop/piece guys tend to be more willing to take extra work, but they complain the most when you take work away when you need to add another truck. I pay a salary and try to encourage a team approach where my guys all help each other out.
My guys get a monthly bonus based on pickups, complaints and accidents. They don't miss pickups.
I use a GPS system so I can watch my trucks all day. There are several companies that offer it. They help in monitoring driver behavior as well, limiting idling time, speeding, excessive braking etc.
 

It will be fine

Well-Known Member
Sorry Last Mile. I'm not buying it.

"How do you ensure..."

"Co-mingled"

"How can you minimize these"

"What steps do you take to minimize these."

"...exceeds your truck capacity..."

"...would be helpful to prevent such failures...?

Everything you post is centered around how the ISP is to service FedEx. And that's fine. But nothing, NOT ONE QUESTION about whether the company handles complaints fairly or controls workforce or inspects vehicles or DQ's drivers or their joke of an appeals process and their even more hysterical negotiations? Not one question about any of that and you would have us believe that you have done "due diligence"?

Lol. No, Lastmile. I'd say you're up to something else and that's fine. But you seem to be FedEx corporate or you are their wet dream come true. Nothing wrong with either and I hope you find the answers you are looking for. Just remember, there are a lot of questions you aren't asking.
I would think management would know the answers to most of his questions already.
 

bbsam

Moderator
Staff member
I would think management would know the answers to most of his questions already.
Exactly.

And soon will come to every station question #9.

And management already knows what answer they want. They want "nanny cams". But they don't come out and say that. There's a push throughout the country for all trucking companies to use them (and they are probably a good idea) but as of this point in time they can't mandate them.

So they sell them with talk of efficiency, and how the technology "pays for itself in preventing...yaddah...yaddah...yaddah".

I mean c'mon. Why don't you just bill him for an RFI?
 

It will be fine

Well-Known Member
Exactly.

And soon will come to every station question #9.

And management already knows what answer they want. They want "nanny cams". But they don't come out and say that. There's a push throughout the country for all trucking companies to use them (and they are probably a good idea) but as of this point in time they can't mandate them.

So they sell them with talk of efficiency, and how the technology "pays for itself in preventing...yaddah...yaddah...yaddah".

I mean c'mon. Why don't you just bill him for an RFI?
Is that an option? I'd totally write one for him. I've got the time.
 

FedGT

Well-Known Member
.......This is going to be long.
I was IC but most of your questions apply to both models.

There isn't much you are going to do to limit codes. You can always call ahead or you can beat it in to the driver to pay attention to closure notes and relay them to the terminal (even with that only a 30% chance the hub won't still load it).

To address your human error question the answer depends on wages (which is the answer to a lot of your questions) no technology for misdeliveries, disputes, conflicts, etc. google earth street view can be very beneficial for disputes but that is it.

There are route optimizer apps for time and fuel (I use one). A combination of a well trained driver and the maps can be very beneficial but the largest problem is time constraints and business hours. Regardless of how well you optimize a route if there are businesses closed at the beginning of the day you are going to be backtracking.

There is tracking software but it is expensive and I would say not worth an investment. Other than that you can see on Mygroundbiz what pickups are done, how many stops are done, and where the drivers last stop was.

1. Hope and pray.

Varies depending on the route. Oversized is the one of the biggest problems with this model. 1 OS box could be 12" long by 20" wide by 1" thick or it could be a damn sectional squeezed into a 36" by 36" cube. Most of my 1200s I don't like to put more than 270 packages 50 OS even that can definitely push it.

2. Not an option, get them out or come back and reload

3. Send an email to the flex guy at FedEx and move whatever stops to whatever driver you want.

4. Old people are slow, millennials are lazy and entitled and usually worthless, don't hire really fat people. Somewhere in the middle is the 1 in 50 that you want to hire and will be a good asset. Efficacy only is dictated on the quality of employee, most efficient is 1 small box per stop but that doesn't pay the bills very well and not going to happen. Great drivers can average over 20 stops an hour in suburban territory bad under 12 and that is pretty well regardless of package count (of course that doesn't include actual bulk truck routes).

5. Don't know

6. N/A and a guessing game to anyone else

7. Weekly rate plus monthly performance bonus

8. Not missed virtually ever, most problems are picking up early or late. There are already reminders in the scanner that they will be closing in 30 min

9. Review paragraph 5
 

FedGT

Well-Known Member
Exactly.

And soon will come to every station question #9.

And management already knows what answer they want. They want "nanny cams". But they don't come out and say that. There's a push throughout the country for all trucking companies to use them (and they are probably a good idea) but as of this point in time they can't mandate them.

So they sell them with talk of efficiency, and how the technology "pays for itself in preventing...yaddah...yaddah...yaddah".

I mean c'mon. Why don't you just bill him for an RFI?

I put those in about two years ago because the terminal was pushing for them and the terminal manager said that the next growth opportunities were going to be weighed heavily on safety technology. Everyone said they weren't going to do it, so I put front and rear facing cameras in 6 of my trucks (my manager and I wired them in) cost me somewhere around a grand. About a month later a growth opportunity came up and they were sitting down with everyone that was eligible, I called them out on what they said and told them if I didn't get it there was zero chance anyone else was ever going to put those cameras in. Well for spending a grand I made a lot more after getting that PSA. Funny thing is that within maybe 6 months enough dirt got in all of them that none of them worked anymore.
 

LastMile

Member
bbsam:
Very presumptuous of you. Think about this honestly:

Everything you post is centered around how the ISP is to service FedEx. And that's fine. But nothing, NOT ONE QUESTION about whether the company handles complaints fairly or controls workforce or inspects vehicles or DQ's drivers or their joke of an appeals process and their even more hysterical negotiations? Not one question about any of that and you would have us believe that you have done "due diligence"?

Actually every one of the questions is related to learning about *how, as an ISP, I can run the business operations more efficiently. You are just looking at it through a different lens.

My not asking about how FedEx handles complaints or controls workforce or inspects vehicles etc... could simply imply that maybe:

a) I may already be aware and understand that aspect (or some portion of it)
b) Right now I happen to simply be focused on understanding the operations processes

So, just because I come from a different background (high tech, business, entrepreneur) and used language in my questions that comes naturally to me, *does not imply that I am an imposter. I have been doing due diligence on FedEx Ground routes and hence tried to use terms that I have learnt about this domain.

But of course, you are entitled to your conclusions. I do think its unfair of you to hijack this genuine thread and create doubt.

I however understand, where your perspective comes from. Yes, FedEx could have and probably has seeded this forum with "moles" and you have been a long time member so would understand this better.

I am going to take the high road and choose to focus on getting answers to my questions :-)

BTW. Thanks for the kudos on the profile picture. She's my harlequin girl.
 

LastMile

Member
It will be fine:
Thanks for the positive response.

Every night you can run a projection of what's coming. This includes cubic feet, so you can see if a bulk stop is huge boxes or envelopes. If all your routes are contiguous you can move stops between them after you run the projection. You just send an email telling the preload where to move it.

So there is a window in time between when you review your projections and send the email request to the FedEx "flex guy" AND when he enters it into the system (before the final sort starts). Is there a specific time by when the ISP / contractor is expected to send in such requests to ensure these get executed?

Wouldn't reviewing the inbound projection as close in time to as when the sort starts, capture the latest snapshot of the projections. So your rebalance would be more realistic to what you (and your drivers) see the following morning?

I use a GPS system so I can watch my trucks all day. There are several companies that offer it. They help in monitoring driver behavior as well, limiting idling time, speeding, excessive braking etc.

Is the GPS system to track your trucks a separate service that you pay for?
But to determine the current status of deliveries and pickups on each truck, you log onto myGroundBiz?
 
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