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Tips for Buying FedEx Delivery Routes

February 25, 2021
FedEx Delivery Routes

When you get a FedEx package, it’s delivered by small business owners who own the trucks and employ the delivery drivers.
Working within FedEx’s well-known delivery infrastructure is one way to launch a new business with the advantage of a strong, established brand name. Additionally, FedEx provides support for its delivery contractors.
Interested in buying a FedEx route? Here’s what you need to know.

How does owning a FedEx route work?

Each small business owner works under a contract with FedEx and must meet certain legal guidelines. This contract outlines the details of a particular route and includes an established book of business. FedEx route owners must purchase their own equipment and hire their own employees.

What other equipment will I need to buy for a FedEx route?

Besides the actual cost of the route, you’ll also need to invest in equipment—specifically delivery vehicles—and be prepared to manage the expenses associated with facilities (either rented or your own home), assets (vehicles, computers, technology, etc.) and business software (financial, route planning, etc.). Online routing software, like MyRouteOnline, can make a FedEx delivery route more efficient—and profitable.

How many stops are on a FedEx route?

Route owners have a list of customers. The number of stops vary by route, which can reach more than 220 packages per day. Some business owners may have more than one route.

How much can you make owning a FedEx route?

Each business has a unique contract with FedEx that outlines the terms of how they’ll be paid. While profits can vary, industry experts estimate that FedEx routes can generate about 10%-25% of revenue. So, for example, if a FedEx route generates approximately $500,000 in revenue, then an average profit margin of 15% is $75,000. The work is generally very stable.

What type of FedEx routes are for sale?

You have three options: Custom Critical owner-operator, independent contractor, or Home Delivery independent contractor.

  • Custom Critical owner-operators make up FedEx’s entire Custom Critical fleet. If you own or plan to own your own vehicle, you might qualify for a FedEx owner-operator position.
  • Ground contractors move packages on the long-haul routes between FedEx ground locations. You have to provide your own tractor (or rig), but FedEx supplies the trailer.
  • A Home Delivery independent contractor is responsible for picking up packages and delivering packages to homes. You must lease your own delivery van and pick up the tab on fuel, insurance and other expenses related to your business.
  • Why are so many FedEx routes for sale?

    FedEx routes are sold for the same reasons as other businesses. The most common reason is retirement. Additionally, FedEx may establish new routes in growing areas or locations where demand exceeds capacity.

    How do I become a FedEx contractor?

    To become a FedEx contractor, get in touch with FedEx Recruiting, either by calling 1-866-711-3599 or filling out the contact form on FedEx’s company website. You’ll get all the information you need. When you are all set, make sure to visit MyRouteOnline to plan your delivery route with us. This will save you time as well as fuel, both are worth money.
    Plan your Route Today, Try it for Free!