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Someone Tell Me How The Ground "SCAM" Is Any Different Than Any Other Franchise Model
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<blockquote data-quote="barnyard" data-source="post: 1132137" data-attributes="member: 13921"><p><strong>Re: Someone Tell Me How The Ground "SCAM" Is Any Different Than Any Other Franchise M</strong></p><p></p><p></p><p></p><p>Actually, the FE contractor scam is not that different than many trucking companies that offer lease/purchase plans to employees. Even though the failure rate is huge and many contractors lose everything they own, it is still legal. Why?? Because big trucking companies lobby to make sure the rules do not change.</p><p></p><p>Consider this example... A CDL holder goes to, let's say ATS, they sign papers to lease a tractor with no money down. According to the lease agreement, they can only haul loads from ATS. ATS books the freight and gives the lease driver a percentage of each load, except the load came from their own in-house brokerage, so ATS took a commission from the broker and from their parent company, leaving the driver with very little to pay for maintenance, fuel and the all important truck payment. There are many tales of drivers that had to live on less than $100 a week after ATS was done taking their cut. Many other tales of drivers that sat because there were no loads around and they could not afford to pay for fuel to get 400 miles to another load. Other tales of drivers who lost their shirts because their tractors broke down, they could not haul loads and could not pay their weekly truck payment.</p><p></p><p>Those drivers are considered independent contractors even though they are dispatched all loads via ATS and must follow their schedule and carry loads that only they book.</p><p></p><p>Many, many other OTR companies do the exact same thing and if the rules were to change for FE, they would undoubtedly also have to change for the OTR fleece scams. Google, "Lease/purchase scam" for lots more info and links to people that have lost everything because of them. I suspect that many of them would argue that the FE model is a pretty good deal.</p><p></p><p>In the lease/purchase scam, the company does not have any of the equipment costs that they would have if they ran their own trucks. Many OTR companies have found that leasing trucks is so profitable that they also own dealerships to sell tractors. The OTR companies make money on the loads and the tractor payments, plus they do not have the employee costs; pretty much just like FE ground.</p><p></p><p>I suspect that FE gets lots of industry support from outside the small package biz for their model.</p></blockquote><p></p>
[QUOTE="barnyard, post: 1132137, member: 13921"] [b]Re: Someone Tell Me How The Ground "SCAM" Is Any Different Than Any Other Franchise M[/b] Actually, the FE contractor scam is not that different than many trucking companies that offer lease/purchase plans to employees. Even though the failure rate is huge and many contractors lose everything they own, it is still legal. Why?? Because big trucking companies lobby to make sure the rules do not change. Consider this example... A CDL holder goes to, let's say ATS, they sign papers to lease a tractor with no money down. According to the lease agreement, they can only haul loads from ATS. ATS books the freight and gives the lease driver a percentage of each load, except the load came from their own in-house brokerage, so ATS took a commission from the broker and from their parent company, leaving the driver with very little to pay for maintenance, fuel and the all important truck payment. There are many tales of drivers that had to live on less than $100 a week after ATS was done taking their cut. Many other tales of drivers that sat because there were no loads around and they could not afford to pay for fuel to get 400 miles to another load. Other tales of drivers who lost their shirts because their tractors broke down, they could not haul loads and could not pay their weekly truck payment. Those drivers are considered independent contractors even though they are dispatched all loads via ATS and must follow their schedule and carry loads that only they book. Many, many other OTR companies do the exact same thing and if the rules were to change for FE, they would undoubtedly also have to change for the OTR fleece scams. Google, "Lease/purchase scam" for lots more info and links to people that have lost everything because of them. I suspect that many of them would argue that the FE model is a pretty good deal. In the lease/purchase scam, the company does not have any of the equipment costs that they would have if they ran their own trucks. Many OTR companies have found that leasing trucks is so profitable that they also own dealerships to sell tractors. The OTR companies make money on the loads and the tractor payments, plus they do not have the employee costs; pretty much just like FE ground. I suspect that FE gets lots of industry support from outside the small package biz for their model. [/QUOTE]
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