The Master Plan

Discussion in 'FedEx Discussions' started by MrFedEx, Jul 14, 2013.

  1. MrFedEx

    MrFedEx Engorged Member

    As others have stated, what is happening now with health care is just the next step in the Master Plan for Express. It isn't a reaction to a downturn in Express is just the next logical and completely planned move for Memphis to cut costs and raise profits...and shift emphasis to Ground. Always, of course, at our expense.

    While I usually disagree with vantexan, he's right in the money as far as his commentary regarding Fred using Express profits to build-up Ground. Anyone who was with Federal Express, knows that "FedEx" is an entirely different company. If any of us knew that this is where Express was headed, there would have been a mass exodus years ago. This is why so many senior hourlies are so bitter, and why newer employees simply don't "get it".

    Fred Smith made a lot of promises to employees, and all of them have been broken. Basically, in return for superior effort and customer service, Federal Express employees were "assured" of a stable, good-paying job with a decent retirement and benefit package. Early on, we also enjoyed Profit Sharing, low cost benefits, jumpseat, and many opportunities for overtime. Top-out took 2 years. If you wanted to work hard, you could easily make some very good money. Wages were never at UPS levels, but they were close. If we had voted a union in years ago, we would have lost nothing, but with things so good, nobody thought we would ever need to be protected from Mr. Smith.

    Federal Express was a quality company with a well-deserved reputation for excellence. The argument has been made that Fred intentionally built a top-notch organization so he could use that "brand" as a stepping-stone to bigger things. The "FedEx" brand is a cheap, low-cost fake, and customers are coming around to the realization that "excellence" and FedEx are mutually exclusive terms. Yet enough consumers remain convinced that we are a quality company that they're still willing to use FedEx. Too bad they don't know what really goes on here.

    Over time, Fred began taking away...because he could and also because he wanted to build an effective rival to UPS Brown. When RPS was purchased, Fred promised that the newly-created FedEx Ground would never compete with the Express flagship. Behind-the-scenes, Ground was being built into what it has become today....a profit powerhouse for FedEx. Sure, it's a scam, but it's making big money, and that's all that matters to Fred.

    Under the radar, Fred began building Ground infrastructure, again via Express profits, and increasingly, through takeaways from Express hourlies. Does anyone remember that the elimination of Profit-Sharing was "temporary", or that killing the Traditional Pension was because it had to be fully funded under ERISA laws? More profit to the Express division, and more funding for the Ground buildup. Yes, we have all helped finance that which is undercutting our jobs and killing our net income.

    A "changing shipping environment"? Yes, but not to the degree that Fred says. Most of what we have lost to Ground has been through intentional sales efforts to shift packages to Ground, where profit margins are higher for one labor. Fred killed our benefits to finance massive construction of Ground sort facilities, which is ongoing as Ground continues to grow. FedEx is a horribly mis-managed company, but the high profitability of Ground hides that from investors. As R1a says, upper management needs Ground to save their own hides lest they be exposed for the morons they really are beneath the surface. Without Ground...they are dead.

    It's probably way too late in the game to do anything but WAD and be as unproductive and uncooperative as possible. There are a relative handful of us who will actually DO something to fight Smith, so he has essentially won. Unless the Ground model is found illegal, he will continue to "win".

    Only a massive effort to network and organize will stop Mr. Smith. Please be assured that this latest takeaway will not be the end of it. Far from it. You've only seen the tip of the iceberg. I see minimums being cut very soon, along with other unsavory changes that will drop your dwindling pay even further.If you want to improve your "career" at FedEx, you need to take action now. Otherwise, accept the consequences of your inaction and stop complaining. You have only yourselves to blame.
    Last edited: Jul 14, 2013
  2. Route 66

    Route 66 Bent Member

    spot on
  3. Doc Sorting Dude

    Doc Sorting Dude Active Member

    I wonder why he took so long to get into the Ground/Freight business? I believe if he had started in the early 90's instead of introducing Ground/Freight service in 1999/2000, UPS would not have all the major package shippers. These big distribution centers are what we need to target if we have any kind of hope of sticking around.
  4. Ricochet1a

    Ricochet1a New Member

    Short answer, Fred didn't want to deal with unions and if he started a 'ground' package delivery service back in the early 90's, he would've had the Teamsters knocking at his door wanting union wages for the 'ground' drivers. Then with the 'ground' drivers getting paid union wages, the Express hourlies would've wanted some of that action, and Fred would've had the Teamsters sitting in his corporate offices having a say in how he ran his business. Fred wasn't about to do that.

    So Fred occupied himself with growing Federal Express until the late 90's rolled around. Then a 'convergence of events' took place which brought the current situation into existence.

    1) UPS entered the overnight package business in a big way at that time. Federal Express' monopoly on that market instantly disappeared, along with its ability to charge monopolistic prices.

    2) The US domestic overnight market was fully 'realized' at that time. Between UPS starting to grab market share and no further natural growth possible, Federal Express hit a revenue 'brick wall' - there wasn't any further expansion to be done; to the contrary, with UPS in the market, Federal Express would have to fight hard and lower rates to keep from losing market share.

    3) Finally, this little, upstart company called RPS caught Federal Express' eye. This company had a synergy of unique tracking ability of the packages in its system, along with utilization of a contractor model performing the movement of the packages (RPS only controlled the central network - virtually everything else was done by contractors providing their own equipment). This business model caught Federal Express' interest, all due to the contractor model which precluded unionization of the individuals (who did a VAST majority of the actual labor) against their 'real' employer.

    This is when Fred broke out into song, something like, "I've got a golden ticket...." Well, it went something like this...


    ​And the rest if history, as they say.
  5. Brazilfree

    Brazilfree New Member

    While I do not disagree with most of what you write MrFedex , I think you credit the FDX leadership with too much smarts these days. There was a time when Fred and the boys could develop a master plan that worked 20 plus years ago... these days not so sure they have a true clue or really care for that matter. To big, to much money to worry about much of anything. Otherwise He wouldn't have the people he has running Express.