Supplementals

[Crozz]

So I know I'm not the only contractor running supplementals. Our terminal alone with 4 contractors we have 8 sups rolling. Our terminal averages 1100 stops and 3500 miles with 11 psa. It's sounds like we don't have a lot of stops but our grid that we cover is 85% rural. If you break it down with the amount of PSA allotted for our terminal each PSA is running 100 stops and 350 miles. I believe it averages a min a stop and an average mph ranges from 13mph-25mph depending on territory and mileage between stops. So at 100 stops that's an 1:40 min just in stops and let's say the mph average at 25 with 350 miles that's 14 hours, so a total of 15.5 hours per PSA. Let's be real 11 PSA for the amount of miles and stops don't add up. At 19 trucks that we are running we average 58 stops and 202 miles. So thats an average of 1 hour to deliver and let's say average mph at 202 is 21 mph that 9.6 hours of driving. That means our drivers are averaging 10.5 hours per driver with supplementals included. Are all terminals like this or does it seem like we are way behind. Also in four years we have only been give 3 PSA we have doubled in 4 years so things just don't at up. Don't get me wrong I love being a contractor but the cost is now break even and I'm looking having to add more sups for myself and the other contractors are bleeding and it seems like we all will be going under without more PSA give to absorb the the cost of running.

 

[bbsam]

So I know I'm not the only contractor running supplementals. Our terminal alone with 4 contractors we have 8 sups rolling. Our terminal averages 1100 stops and 3500 miles with 11 psa. It's sounds like we don't have a lot of stops but our grid that we cover is 85% rural. If you break it down with the amount of PSA allotted for our terminal each PSA is running 100 stops and 350 miles. I believe it averages a min a stop and an average mph ranges from 13mph-25mph depending on territory and mileage between stops. So at 100 stops that's an 1:40 min just in stops and let's say the mph average at 25 with 350 miles that's 14 hours, so a total of 15.5 hours per PSA. Let's be real 11 PSA for the amount of miles and stops don't add up. At 19 trucks that we are running we average 58 stops and 202 miles. So thats an average of 1 hour to deliver and let's say average mph at 202 is 21 mph that 9.6 hours of driving. That means our drivers are averaging 10.5 hours per driver with supplementals included. Are all terminals like this or does it seem like we are way behind. Also in four years we have only been give 3 PSA we have doubled in 4 years so things just don't at up. Don't get me wrong I love being a contractor but the cost is now break even and I'm looking having to add more sups for myself and the other contractors are bleeding and it seems like we all will be going under without more PSA give to absorb the the cost of running.

Yeah. Pittsburgh has you exactly where they want you.

 

[BigTex61]

Do you mean to say the math on the Ground side is fuzzy too?

 

[Mr. 7]

So, if Pitts. is making being a ground contractor non-profitable, what is their game plan? Who is gonna do it? Illegals?

 

[It will be fine]

So, if Pitts. is making being a ground contractor non-profitable, what is their game plan? Who is gonna do it? Illegals?

The plan is to have contractors pay the cost of the crazy growth we experience. Established routes make a profit, when you have to split them the contractor eats a loss for a few years. They count on the contractors having too much invested to bail, and when the new routes are losing money it kinda makes it harder to sell. So, a contractor with several hundred grand invested in a business will just eat the loss in the hope that it one day will be profitable again. Unfortunately the way we grow we are constantly having to add new money losing routes. Now I just budget for at least one losing route going out everyday.
It's kinda like the Spanish Prisoner con. Con man keeps asking for more fees from the mark that hopes for a big payout eventually.

 

[Crozz]

Mr.7 Good question it's growing so fast that all contractors are adding more and more resources without extra PSA being handed out. I'm wondering if the plan is to wait it out until they flip all states ISP, problem is that May be years from now and if that's the case lots of contractors will be bankrupt. You don't even want me to get started with peak pay. For the last 3 years that has about put my company under. Double the fleet, employees, and risk for - incentive.

 

[bbsam]

So, if Pitts. is making being a ground contractor non-profitable, what is their game plan? Who is gonna do it? Illegals?

It's profitable. But they want UPS production RPS payout. Seeing it from the contractor level we just kinda walk away from local management. Nobody believes anything coming from their ass kissing lips anymore. Morale couldn't be lower and the definite feel is that nobody in the company really gives a "friend".

 

[MAKAVELI]

It's profitable. But they want UPS production RPS payout. Seeing it from the contractor level we just kinda walk away from local management. Nobody believes anything coming from their ass kissing lips anymore. Morale couldn't be lower and the definite feel is that nobody in the company really gives a "friend".

It's the same on the Express side. I liken it to running this company like a sweat shop. Executive management is so consumed with pushing the stock price, they are willing to friend...k everyone, including the customer.

 

[overflowed]

It's profitable. But they want UPS production RPS payout. Seeing it from the contractor level we just kinda walk away from local management. Nobody believes anything coming from their ass kissing lips anymore. Morale couldn't be lower and the definite feel is that nobody in the company really gives a "friend".

You always liked to say we're all ground now. It seems we're all Express now.

 

[bbsam]

You always liked to say we're all ground now. It seems we're all Express now.

Let's agree at "We're all Fedex now."

 

[Cactus]

It's profitable. But they want UPS production RPS payout. Seeing it from the contractor level we just kinda walk away from local management. Nobody believes anything coming from their ass kissing lips anymore. Morale couldn't be lower and the definite feel is that nobody in the company really gives a "friend".

Well Sammy, to me it looks like the honeymoon is over. But your observations are spot on.

 

[overflowed]

Let's agree at "We're all Fedex now."

Just seems like the stuff you're not happy about for a while is what we've been talking about for the longest time. We've told you it will come to you. But you are correct, we are all fedex. Like cactus said the ground honeymoon is over.

 

[STFXG]

Mr.7 Good question it's growing so fast that all contractors are adding more and more resources without extra PSA being handed out. I'm wondering if the plan is to wait it out until they flip all states ISP, problem is that May be years from now and if that's the case lots of contractors will be bankrupt. You don't even want me to get started with peak pay. For the last 3 years that has about put my company under. Double the fleet, employees, and risk for - incentive.

Plan on fall of 2016 for ISP-like contracts. That's my guess. Unless the MDL comes back in favor of the "drivers". Then it will get pushed out sooner.

I know that feel though. No mileage pay for supps . You're getting killed with that many miles and not getting paid for them. Hope you have high core zones...

 

[Crozz]

$125 core zone helps very little rural routes only do 45 stops but 300 miles and settlement is a big whopping $1450-1550. I've broke it down rural routes are costing me around $1750 to run with the cost of maintenance drivers and 4 year notes on my trucks because I'm doing 56000-72000 miles a year on my trucks. Luckily I have both in town hd/g and out of town hd/g. 17 PSA and 4/5 sups between sups and out of town routes my profit margin is gone. Not to mention in IC you cap at 10 routes with quarterly so I'm not get that for 7 routes witch is 44k a year. I don't hate fedex I just want it to be fair in the end for me as a business owner and for my guys that bust their ass day in day out with no future in the end.

 

[Crozz]

STFXG are you ISP or IC. If your ISP are you happier and did you get a good negotiation price for each unit?

 

[BigTex61]

Let's agree at "We're all Fedex now."

We're all screwed now!

 

[STFXG]

STFXG are you ISP or IC. If your ISP are you happier and did you get a good negotiation price for each unit?

I'm IC with rural routes. There's a couple ISP guys on here though.

 

[It will be fine]

We're all screwed now!

The difference is we were never treated well.
To OP, ISP doesn't change your life or compensation too much. Generally you make less although they are changing the bonus now to not be as bad for an early/missed pickup. Difference for you would be you never expect any additional income by getting a PSA. It's just stops and pieces and you deal with it.

 

[Crozz]

Rumor is ISP won't be the end model. I think they use ISP to clean single vans and then change the model to fit. They know we are growing and we can't continue to run like we do with the growth. ISP imo is just like IC. I believe the model should be a tier system. Why should I get paid the same as a guy with 5 routes compared to my 21 it takes one coordinator for every 5 and a manager and trainer. So my cost to run business is way more than the guy with five. But the models the way they are why you have more than five the cost is two much.