If you have ever received a package delivered to your home, you have probably wondered how do FedEx routes work. With FedEx handling several million packages a day, this post will aid potential route owners in understanding fact vs. fiction surrounding routes.
Many people confuse the FedEx business model with other shippers. However, there are several distinct differences between the vision CEO Frederick W. Smith has established for FedEx opposed to the operations of Big Brown and other shipping companies.
Many people don’t realize that when FedEx delivers a package to your home or office, it is, in fact, a small-business and his or her employees behind the work. Even the truck(s) are owned by these small corporations.
FedEx’s established infrastructure is very appealing to entrepreneurs across America who love the idea of owning their own business while leveraging the brand name of an internationally recognized and trusted brand name. At the end of the day, FedEx offers a great amount of support with a single goal in mind: to serve its customers well and safely.
So how do FedEx routes work? Each of these small business owners has an individualized contract with FedEx that outlines the terms of the agreement, such as how they will be paid, how many stops are on a route, the volume of packages to be delivered and more. Some routes will deliver upwards of 220 packages in a day.
How do delivery routes work in general? In a nutshell, route owners inherit an established book of business and need to purchase the equipment necessary to successfully do the work.
When it comes to FedEx routes, individual owners set their workers pay, which can be hourly or daily. Within legal and FedEx guidelines, the owner sets the wage and frequency.
FedEx routes can change slightly from day to day, but many drivers get to know their routes (and customers) like the back of their hand.
Despite decades of operations research and decision modeling on FedEx’s end, many route owners rely on tools on the internet to help them optimize directions for components of their routes. After all, this efficacy saves on gas and time – putting more money into the owner’s hands.
The work is generally very stable, as the amount of packages being shipped has steadily climbed year-over-year-over-year. Last quarter, FedEx reported delivering over 14M packages on average a day. So the question is not just how do FedEx routes work, but how do they work so well!