How to Sell Your FedEx Routes for the Most Value
Founded in 1971 and headquartered in Memphis, Tennessee, Federal Express (FedEx) is a multinational delivery company used by millions of individuals and corporations all over the world.
What a lot of people don’t realize, however, is that FedEx offers a unique opportunity for motivated entrepreneurs to purchase FedEx Ground routes and operate their own FedEx business, either picking up and delivering packages (P&D routes) or transporting FedEx Ground trailers (linehaul routes).
FedEx contractors and independent service providers (ISPs) negotiate the terms of their contracts directly with FedEx and can unilaterally decide whether they want to continue operating the business or sell their routes to an interested buyer.
If you do decide to sell your P&D or linehaul business, there are several things that will increase the value of your routes.
On average, FedEx P&D route businesses sell for 3-3.5X their free cash flow, while linehaul businesses can sell for upwards of 4X or more. However, a lot of that depends on how attractive your business is to potential buyers.
First and foremost, buyers will want to see that your business is profitable and has potential for growth. To show this, you will need to have your books in order. Be prepared to provide key financial documents and forms such as business tax returns and a comprehensive profit and loss (P&L) statement to demonstrate that your business is financially healthy.
Interested buyers will also want to know about your employees and your equipment. Remember, they’re not just purchasing your routes; they’re also taking over management of your employees and assuming ownership of your vehicles and all other business assets. Are your employees hardworking and trustworthy? Do your drivers have a history of safety and longevity? Is your fleet of trucks in good working order and properly maintained? If so, your business will be even more attractive to buyers.
Finally, it is important that your FedEx route business operates efficiently and that there are systems in place to ensure processes such as scheduling, staff training, and day-to-day operations all run smoothly. This will put the buyer at ease and reassure them that the transition will be seamless.
Ready to sell? Take a look at our Seller Due Diligence List to make sure you’re prepared.
Then, contact a reliable FedEx broker for a comprehensive route valuation.
Because there are so many variables involved with selling a FedEx route business, it is better to work with a reputable brokerage firm than to go it alone.
An experienced broker does the complicated work of listing and marketing your routes, locating and vetting potential buyers, and handling all negotiations pertaining to the sale. In other words, your broker can save you a lot of the hassle of selling your FedEx routes so you can continue to focus on running a successful business.
Click here to find out more about the benefits of working with a FedEx broker.
Sell your routes for a premium price with KR Capital.
An industry leader specializing exclusively in the sale of FedEx routes, KR Capital has worked with hundreds of FedEx contractors nationwide to successfully value, market, and sell their routes for a premium price.
We have developed a robust inventory of resources and partnerships that is second to none, and we offer a free comprehensive route valuation for potential sellers.
If you’ve decided now is the time to sell your FedEx routes, contact KR Capital today or fill out our simple online form. We look forward to learning more about your business and answering any questions you may have about the sales process.