Most people who use FedEx ground delivery services or see FedEx trucks on the road don’t realize it’s possible to buy FedEx routes as a business investment. In reality, most FedEx routes are run by owner-operators, known as independent service providers (ISPs). These owner-operators own their FedEx delivery routes. Some are driving and delivering packages themselves, while others hire employees to do the driving and delivering.
You can find FedEx routes for sale through a FedEx route marketplace or contact an existing ISP directly. Once you acquire a FedEx route, you’ll need to purchase or lease vehicles and equipment and hire employees to help run the business. In addition, all
drivers must meet FedEx’s driving safety rules, and owner-operators are required to set up the company as a corporation. Besides, owning a FedEx route is similar to running an independent business encompassing all the responsibilities business owners perform.
Summary
Why Are So Many FedEx Routes for Sale?
Because FedEx routes involve all the obligations and liabilities of owning any business, after buying their routes, some ISPs discover they aren’t cut out for entrepreneurship. Even though it’s a proven concept and boasts a legendary brand name, buying FedEx routes doesn’t guarantee business success. Running a business is hard work, involving long hours, and in a stressful competitive environment. For those reasons, finding FedEx ground routes for sale may be easier than you think.
How to Buy a FedEx Route
Buying a FedEx route is just like buying any other business. You must ask a lot of questions.
Here are some good starter questions to ask an existing FedEx Ground route owner who is interested in selling their route/s:
- How many FedEx routes do you have now?
- How many FedEx deliveries are you doing now?
- How many drivers do you have?
- What do you do if a driver is out sick?
- How did you get into this business?
- How has the business changed over the years?
- Have you received any citations from FedEx?
- Why do you want to sell?
- What do you think the future of FedEx Ground is?
- Are you willing to offer owner-financing?
- What type of qualification process do you think I’ll have to go through so FedEx will allow me to purchase your business?
- What type of cash reserves will I need for the business?
- Can I review a recent business tax return and balance sheet?
- Do you have an operations manager?
- What is your workday like?
While finding a FedEx route for sale may be easy, finding the money to buy a route may not be as simple.
Who Offers FedEx Route Financing?
As of the writing of this article, there is no specific lender to turn to for FedEx route financing. However, there are two options for purchasing FedEx routes that are used most often by buyers.
Seller/Buyer Financing
Buyers can offer existing route owners a sizeable down payment and then pay the remaining amount due in monthly installments. In this scenario, typically, the buyer will pay the owner more than the original “asking price” for accepting financing.
Term Loans
In the second financing option, the buyer turns to financial institutions to apply for a term loan. Keep in mind that bank loans require the borrower to put up some form of collateral (i.e., your home) to back up the term loan. Banks also require a solid personal credit score (680 or higher).
Most financing institutions may be reluctant to finance new FedEx route purchases because there is no collateral in a FedEx Ground business. Also, if the FedEx route owner fails to perform appropriately under FedEx Corp’s requirements, FedEx has the right to assign the rights of their routes to another company.
Financing Solutions Line of Credit Program for FedEx Ground Companies
Once you buy a FedEx route, like most business owners, you’ll find your company experiencing cash flow ups and downs. At these times, having access to a line of credit would come in handy. Financing Solutions is the leading provider of Lines of Credit to EXISTING FedEx route owners, and we also understand the needs of FedEx Ground route owners.
Financing Solutions, an A+ and 5-stars-rated BBB company, has provided small business credit lines since 2012. And specifically, FedEx Ground companies use Financing Solution’s credit line because it’s easy, fast, and inexpensive.
To qualify, you must already be a FedEx route owner and have a 630 or greater personal credit score. There are no collateral or personal guarantees required, and it only takes two minutes to apply.
The Line of Credit costs nothing to set up and nothing until you use it. Even when you do tap your lie, it’s inexpensive. The majority of FedEx Ground Owners use the credit line for:
- Emergency maintenance of trucks
- Purchasing used trucks
- Hiring additional employees
- Getting personal money out of business
- Putting down payments on new routes
- As a cash backup plan for in case of emergencies or emerging opportunities
If you would like to apply for a line of credit or get additional information, click here.
Financing Solutions LLC is not endorsed by and is not recommended by Federal Express Corporation and FedEx Ground. Financing Solutions LLC is not sponsored by, is not approved by, is not associated with, and has no connection whatsoever with Federal Express Corporation or FedEx Ground.
