When it comes to purchasing the right FedEx Ground route for you, there are a lot of things to consider. Fortunately, you have a lot of data at your fingertips, and you can use that data to determine the right route when you are deciding what to buy and where.
The other good news? A route broker like Route Advisors can help. We can look at these things together to make sure you get the right route at the right time for the right price.
Location Determines the Right Route for You
Drivers are early risers and must get to the terminal early. You either want to own a route at a terminal close to your home, or somewhere near where you are willing to move.
There are exceptions, but for the most part you will commute to and from the terminal where your truck is parked. The commercial pickups you do will need to go to the terminal and be scanned and enter into the system at the end of your shift. Your truck and equipment will be more secure in the terminal than in your driveway.
There is another factor as well. Some rural routes are run out of urban centers, and a driver might go as much as 45 minutes to an hour and 50-60 miles before their first stop. If you have this kind of route, you also need to factor in that you will be doing some additional driving during the day.
Obviously, this is easy data to gather. Simply look at the closest terminal to where you live or want to live.
This leads us to the next consideration.
The Physical Size of the Route
There are really two types of routes: those where stops are close together. There is less driving distance, but usually, there are more stops and a higher volume of packages. These are often urban areas and pick up and drop-off docks can be busy, traffic is a factor in how you route your stops, and you tend to spend more time out of your truck than in it.
Rural routes have stops spread further apart. You’ll spend more time driving, have fewer stops, lower package volume, and often you’ll have a more personal connection with your customers.
FedEx sets up these routes on historical data about how many homes and businesses are in each area, how much volume they do with FedEx, and the customer service value of providing service to them.
You can look at all this data, but another thing to look at is growth potential. First though, you’ll want to look at the average number of stops you do in a day.
The Average Number of Daily Stops
How do you determine the efficiency of a route? Well, you simply take the average number of daily stops and divide that by both mileage and time. If you are purchasing an established route, this is pretty easy, because you have hard data. If you are buying a new or expansion route, there will probably be some estimated data for you to look at.
Mileage will tell you how many miles you will travel on average per stop. In an urban area, this can be fractions of a mile. In a rural setting, it can be multiple miles per stop.
The second factor is time: how much time do you spend on each stop? This can vary by length of day. In urban settings, this can be impacted by peak traffic times. In rural settings, this can depend on road conditions and speed limits. Gravel roads will slow deliveries, as will neighborhoods or winding roads with lower speed limits.
Once you do this, you can figure out a route’s value per mile and per hour. Sort of. But there is another factor.
The Number of Commercial Pick Ups and Deliveries
Commercial pick ups and deliveries will impact your overall calculations. You may make one stop and drop off dozens of packages. The same can be said for pick ups. However, these are sometimes scheduled, and you need to route your stops accordingly so you don’t waste extra time and mileage backtracking to them.
Docks can also be busy at various times, and you want to schedule your pick up and deliveries in off-peak times if possible. If you have a lot of afternoon pick ups that are commercial and in the same area, you’ll want to consider how and when you schedule residential stops.
But these commercial stops pay well, so the more you have, often the more profitable your route will be. So don’t count them as simply a normal stop but be sure to consider the extra profit potential of commercial deliveries and pick ups.
An Equipment Evaluation Can Help Determine the Right FedEx Ground Route for You
When you are buying a route, you have some decisions to make. You can purchase the route itself, or you can purchase the route and equipment from the previous owner if they are including it in the deal. Which is best?
Well, that depends. Look at the age of any vehicles, maintenance records, and have a mechanic do an inspection for you. Look at any hauling equipment like dollies or carts. Buying a new route can be a great time to invest in new equipment.
You can even go electric with your vehicles in some cases, saving you money in the long run. However, any investment in new equipment right away increases your up-front costs and how long it will take for your route to be profitable.
Look at your financial situation and the value of the current equipment, and determine if you should simply purchase equipment with the route or start fresh with your own.
Growth Determines the Right Route for You
Finally, the financial health of the route and how much it grows year over year can help you determine if this is the right FedEx Ground route for you. A new or expansion route can grow quickly, at least for a while. Rural routes can add new neighborhoods, while some urban routes may be more stable with little area for growth.
Which one is right for you? Well, it depends. If your goal is to be a multiple route owner, employ drivers, and expand your business over time, then growing routes may be the answer. If you are more risk-averse, and want something more stable with a proven profit, then a route that grows more slowly might be the best choice.
Is there any one route that is the right FedEx Ground route for you? That depends. But using data, you can determine a lot about a route before you buy. Sound confusing? Need help finding the right route? Contact us today at Route Advisors. We will be with you every step of the way.