What Are the Startup Costs to Owning Your Own FedEx Route Business?
Like any commercial investment, you will need to incur some initial startup costs before you can get your FedEx route business up and running.
The good news, however, is that once those costs are covered, you now own a business with well-established processes in an industry that will always be necessary—not to mention your enterprise is backed by a globally known brand that consumers already know and trust.
That said, your primary startup costs will be for your routes and vehicles.
FedEx routes are available all across the country. Depending on the type of route you are considering (P&D vs. linehaul), a single route may cost anywhere from $100,000 to $400,000, depending on its profitability, location, fleet, etc. Routes are sold with and without trucks, so the fleet will play a factor in the price you ultimately pay for the business.
For routes that are sold without a fleet, the vehicles will be your next biggest start-up expense. Contractors are responsible for buying (or leasing) and maintaining a fleet of trucks to transport and deliver packages. For buyers looking to start small, pickup and delivery (P&D) routes are often recommended over linehaul routes. P&D vehicles are smaller and less expensive to maintain. P&D drivers are also often easier to get approved by FedEx as they do not require a commercial driver license (CDL).
After that, you will need to hire and outfit your team.
As a FedEx route business owner, you will likely employ a driver for each route, along with any managerial and administrative personnel you deem necessary. The expenses associated with outfitting your team may include uniforms for your employees, decals for your vehicle fleet, and the FedEx scanners and software you will need to ensure on-time pickup and delivery.
Is financing available to purchase FedEx routes?
Yes. In fact, the majority of buyers require some form of financing to purchase their FedEx route business, and there are several options available. The most common option is a Small Business Administration (SBA) loan, but you may also choose to work with a private lender or use your retirement savings or home equity line of credit.
Working with an experienced broker can help you keep your FedEx business startup costs to a minimum.
For many individuals, the decision to buy FedEx routes is one that provides the professional and financial freedom they have been looking for, but just taking those first steps can feel like a challenge. As the premier FedEx broker in the nation, KR Capital has sold countless routes over the years and can help you minimize your startup costs so you can get your FedEx business off the ground.
Whether you are considering purchasing five, ten, or 50 routes, our experienced team will work with you to ensure: (1) your initial costs are as low as possible, (2) the terms of your purchase are negotiated fairly, and (3) that confidentiality is maintained through the entire sale process.