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<blockquote data-quote="Ricochet1a" data-source="post: 1171942" data-attributes="member: 22880"><p>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. </p><p></p><p>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. </p><p></p><p>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. </p><p></p><p>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. </p><p></p><p>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. </p><p></p><p>This is when Fred broke out into song, something like, "I've got a golden ticket...." Well, it went something like this...</p><p></p><p>[video=youtube;9ieeL9FWURM]http://www.youtube.com/watch?v=9ieeL9FWURM[/video] </p><p></p><p>And the rest if history, as they say.</p></blockquote><p></p>
[QUOTE="Ricochet1a, post: 1171942, member: 22880"] 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... [video=youtube;9ieeL9FWURM]http://www.youtube.com/watch?v=9ieeL9FWURM[/video] And the rest if history, as they say. [/QUOTE]
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