Question: Is now a good time to buy a FedEx Ground Route?

MrFedEx

Engorged Member
Originally I was going to let this go, but it really smacks of ugliness. I have a route that I am in the process of selling. $75,000 is the price. That's a good chunk of money. But let's see it in another light. What's a 4 year college degree cost? How much money can you make while going to school full time? What kind of job are you guaranteed when you finish school and at what salary? Don't most college graduates have a sizable amount to pay back in loans? This is why I always say that getting into ground depends upon the individual. Now in this light, how bad is the deal?

Good post. I have a couple of degrees that cost me (and Fred) good money and I don't use them very often. My gripe is that Ground is just another FredEx method to get more by paying less and taking advantage of a certain demographic. I notice you didn't really touch upon my questioning the ethics of the Ground model.
 

FedEx courier

Well-Known Member
They don't know how to bleed purple and take their basic skills test. FedEx 4 Life would have never been able to become a courier if they didn't take that. What a joke this person is!:smart:
 

bbsam

Moderator
Staff member
Good post. I have a couple of degrees that cost me (and Fred) good money and I don't use them very often. My gripe is that Ground is just another FredEx method to get more by paying less and taking advantage of a certain demographic. I notice you didn't really touch upon my questioning the ethics of the Ground model.
The question of business ethics is far too large. Do you have a specific in mind? Often it seems that "ethics" charges boil down to "I don't like what they are doing."
 

MrFedEx

Engorged Member
The question of business ethics is far too large. Do you have a specific in mind? Often it seems that "ethics" charges boil down to "I don't like what they are doing."

Yes. Is the Ground model ethical? I think not, because it relies on exploitation.
 

bbsam

Moderator
Staff member
Yes. Is the Ground model ethical? I think not, because it relies on exploitation.
Exploitation "an act that exploits or victimizes (treats unfairly) another". See the problem? You say it's unfair I say it's fair. You and I will continue to see things differently strictly on the basis of our respective ideas of fair and thus my contention that the question is impossibly subjective.

If one wants to, exploitation is seen everywhere. You would probably say Fred is exploitative with his Express dealings. Others would say Ups is exploitive. We could probably make a case for capitalism, oligarchies, slavery, and monarchies are all exploitative. So is it Fedex or capitalism that is unfair? Upstate is right. The labor market determines fairness. Good luck in your organizing efforts.
 

Ricochet1a

Well-Known Member
Exploitation "an act that exploits or victimizes (treats unfairly) another". See the problem? You say it's unfair I say it's fair. You and I will continue to see things differently strictly on the basis of our respective ideas of fair and thus my contention that the question is impossibly subjective.

If one wants to, exploitation is seen everywhere. You would probably say Fred is exploitative with his Express dealings. Others would say Ups is exploitive. We could probably make a case for capitalism, oligarchies, slavery, and monarchies are all exploitative. So is it Fedex or capitalism that is unfair? Upstate is right. The labor market determines fairness. Good luck in your organizing efforts.


I think the difference in definitions here is whether we use a "normative" definiton, or a comparitive definition. In a free market, the market decides norms. We're not trying to alter the free market definition. We are trying to change the situation in FedEx based upon comparitive analysis with UPS. As long as drivers accept $13/hr to work for Ground, the free market has decided what is acceptable. We want to set the bar higher and compare compensation to UPS levels and deal from there.

Here's our angle. The free market isn't always best for those participating within it. What costs $10/hr to perform in the US costs a fraction of that to perform in the PRC. Free market at work. But does that mean that US workers should be willing to accept that same level of compensation that is provided in China? Should our markets be open to goods that are produced by labor performing under conditions that don't meet US standards? Access to markets isn't just a "low price take all" situation. We have values we want to ensure are maintained by those we trade with.

When a situation exists where labor is being performed and there are widely varying compensation levels depending on which corporation is employing that labor, a free market imbalance exists. Some where in that mix, compensation isn't where the market dictates where it should be. I know many would say that unions are artificially inflating the market equilibrum price point for labor. There is truth to that argument. But the fact remains that the corporation which hires that labor consistently makes a profit.

Free markets are a theoritical construct. Managed markets are the reality. We want to "manage" our labor rate with our employer.
 

bbsam

Moderator
Staff member
I think the difference in definitions here is whether we use a "normative" definiton, or a comparitive definition. In a free market, the market decides norms. We're not trying to alter the free market definition. We are trying to change the situation in FedEx based upon comparitive analysis with UPS. As long as drivers accept $13/hr to work for Ground, the free market has decided what is acceptable. We want to set the bar higher and compare compensation to UPS levels and deal from there.

Here's our angle. The free market isn't always best for those participating within it. What costs $10/hr to perform in the US costs a fraction of that to perform in the PRC. Free market at work. But does that mean that US workers should be willing to accept that same level of compensation that is provided in China? Should our markets be open to goods that are produced by labor performing under conditions that don't meet US standards? Access to markets isn't just a "low price take all" situation. We have values we want to ensure are maintained by those we trade with.

When a situation exists where labor is being performed and there are widely varying compensation levels depending on which corporation is employing that labor, a free market imbalance exists. Some where in that mix, compensation isn't where the market dictates where it should be. I know many would say that unions are artificially inflating the market equilibrum price point for labor. There is truth to that argument. But the fact remains that the corporation which hires that labor consistently makes a profit.

Free markets are a theoritical construct. Managed markets are the reality. We want to "manage" our labor rate with our employer.
Well then I would think that there is really no ethics conversation to have. It seems that you and MrFedex want to have it both ways. Ground drivers are inferior and unprofessional but deserve higher compensation. But really it is self interest that motivates your post. Ground with all it's inferiority threatens Express business. Why dress it up in high ideals with talk of ethics? You and I will always respectfully disagree on the Ground model but you may persuade others to organize.
 

Ricochet1a

Well-Known Member
Well then I would think that there is really no ethics conversation to have. It seems that you and MrFedex want to have it both ways. Ground drivers are inferior and unprofessional but deserve higher compensation. But really it is self interest that motivates your post. Ground with all it's inferiority threatens Express business. Why dress it up in high ideals with talk of ethics? You and I will always respectfully disagree on the Ground model but you may persuade others to organize.

Ethics is a bit too large in scope to adequately relate to what we are attempting. Like you asserted, ethics aren't necessarily universal. What I believe to be acceptable conduct may be a higher standard than your beliefs.

You have hit on an important issue regarding compensation levels though. The quality of individual that will be attracted to a wage, increases in direct proportion to the wage being offered. I'd never work for Ground wages, I'm not happy with Express wages. Express is getting the quality yet not paying for it right now. Some of us would like to change that.

With a higher wage being offered, employers can raise the standards for the potential employees. Unions know this and this is why the model works. Union members by necessity have to meet a higher standard to justify the increased compensation they are receiving. Express Couriers, RTDs and Mechanics have no problem with meeting a higher standard, we already do. We want the compensation levels that go along with that higher standard.

Yes, Ground drivers deserve better wages. With a better wage rate, better quality employees will offer themselves for employment. You'll still get drivers, you'll be able to raise your standards and FedEx would be able to maintain the high quality levels which it made a market for itself with years ago. Quality has a price. FedEx isn't paying right now.
 

FedExer267

Well-Known Member
Amen, Ricochet hit it right on the head. You want quality but are not willing to pay a fair days wage for a fair days work. I am a former Upser like I said before so my customers get the service they deserve after all I was trained by the best. 13 dollars a hour for a wage is ridiculous in this industry topped off with no benefits no vaction and no sick days. However if you think about it is it really 13 a hour I think not. Doing Kinkos working 65 hours a week for 650.00 sounds like 10 bucks a hour to me. The problem is most contractors are just to cheap to take care of those who pad their pockets. Its not a matter of if but when this scam comes to a end and ground drivers will get theirs. If we work for contractors why is it we are treated like employees by fed ex? We drive a truck that says fed ex we also wear a uniform that does not differ much from express. We have to go to their meetings and if their is a problem its not the contractor that comes to us but fed ex management, If it walks like a duck and talks like a duck hmmm must be a duck
 

bbsam

Moderator
Staff member
Amen, Ricochet hit it right on the head. You want quality but are not willing to pay a fair days wage for a fair days work. I am a former Upser like I said before so my customers get the service they deserve after all I was trained by the best. 13 dollars a hour for a wage is ridiculous in this industry topped off with no benefits no vaction and no sick days. However if you think about it is it really 13 a hour I think not. Doing Kinkos working 65 hours a week for 650.00 sounds like 10 bucks a hour to me. The problem is most contractors are just to cheap to take care of those who pad their pockets. Its not a matter of if but when this scam comes to a end and ground drivers will get theirs. If we work for contractors why is it we are treated like employees by fed ex? We drive a truck that says fed ex we also wear a uniform that does not differ much from express. We have to go to their meetings and if their is a problem its not the contractor that comes to us but fed ex management, If it walks like a duck and talks like a duck hmmm must be a duck
With all due respect sir, wake up. The contractor model is not going anywhere. You've heard of the lawsuits? Now go read the follow-up. Read the court decisions. Show me one place that the court has forced Fedex to abandon the contractor model. I'll save you the time. They haven't. The Estrada case in California I would suggest had exactly the opposite effect than the plaintiffs had envisioned. The company is moving more and more in the contractor direction.

I understand that you are not happy at Ground. Have you looked at moving to Express?
 

bbsam

Moderator
Staff member
With all due respect sir, wake up. The contractor model is not going anywhere. You've heard of the lawsuits? Now go read the follow-up. Read the court decisions. Show me one place that the court has forced Fedex to abandon the contractor model. I'll save you the time. They haven't. The Estrada case in California I would suggest had exactly the opposite effect than the plaintiffs had envisioned. The company is moving more and more in the contractor direction.

I understand that you are not happy at Ground. Have you looked at moving to Express?
Anyone?
 

FedEx All the Way!

Well-Known Member
I looked into getting a McDonald's franchise 5 years ago since they're almost always profitable. Let's just say that you need a very high net worth and a lot of cash. I had the net worth, but I didn't have the cash, so I got a polite letter saying to try again when I had more money.The numbers I quoted were for my part of the US...they may be different in other areas of the country. In short, they can afford to be very selective about their franchisees because they have an extremely desirable and successful opportunity for sale.

A friend of mine managed a McDonald's after he retired from the Air Force. This was 4 years ago, but he made less than $50,000 per year. Please explain to me how he could ever afford to become a franchisee unless he inherited money or worked several jobs for a long time?

The original point of this was the question whether or not a Ground driver could ever afford to become a contractor. Of course they could, if they worked 20 hrs a day or went into hock with loans (much more likely). Under the single-operator scenario FedEx really has you by the short hairs because they want you to buy the vehicle from them ($$$$) too. A few years back there were scores of ads from single vehicle operators looking to unload their routes and vehicles at a big loss. That's changed with the explosion of growth at Ground, but the ones making the money are FedEx Corporation and the multiple-vehicle operators like bbsam. The individual contractor still has some hefty costs and isn't making good money.

By the way, what is a BST? Ask your friend who works for us what it stands for, OK?

Why did you let the opportunity with McDonalds go? You should have applied as a cook, since you're so unhappy at FedEx. I'm sure Fred would have gladly let you go!!!!
 

FedExer267

Well-Known Member
Ok bbsam you are looking for some input so lets talk about the guys in California. Yes they still work for a contractor but the judge did rule that they are indeed employees correct. Once Fed Ex Express is done and on there way to a union vote look for the teamsters to start a building by building campaign. They will start in the states where the drivers are employees. So if you indeed do own lets say 7 routes how many of those routes do you drive by yourself chances are you have hired 6 drivers. 6 drivers will vote yes because they want benefits, vacatoin pay, holiday pay, hourly pay and overtime well right there your outvoted 6 to 1 chances are it will fall on the contractors at first and when you cant do it Fed Ex will have to step in buy you out probally for cost and bye bye contractor model. Now that California Drivers are classified employees I am sure it is just a matter of time. The Teamsters will come strong after express gets their right to vote. I am pretty sure every contractor has more employees working for them especially when you own multiple routes. The contractors will get out voted employees will win and happily go union to start earning that FAIR DAYS PAY FOR A FAIR DAYS WORK something that many contractors are unwilling to provide. This may be why there are already union members in th ground parking lots handing out their flyers.. We shall see
 
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