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FedEx 2.0, Hiring Challenges, and Growing a Logistics Business | LIVE with Amy Byers — Transcript

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0:00Welcome to Industry Insights with Route Consultant, your front row seat to the
0:04fast moving world of logistics and beyond.
0:07Each week, we bring you game changing insights, real world strategies and
0:11fresh perspectives to fuel smarter investments and build stronger businesses.
0:16Join us as we sit down with expert guests to explore emerging
0:20trends and pressing topics.
0:21Across a wide range of industries.
0:24This is industry insights.
0:32right, everybody.
0:33I, I think people are gonna start trickling in from,
0:35uh, the, the waiting room.
0:37So, awesome.
0:38Uh, as everybody comes in, Amy, uh, and, and everybody who's live,
0:42welcome to our first live industry insights session in a long time.
0:46It's actually the first one this year.
0:47Um, for those of you who might've followed our content for a while,
0:51uh, and gone and seen a bunch of our webinars in the past, we used to do these
0:54webinars actually every single week.
0:56But over the last year or so, we've adopted a little bit of a
0:59different style with some produced content in our studio and, and some
1:03interviews that release each week.
1:05Uh, but I think there's room for both of those types of content.
1:07So one of the things you're gonna start seeing more of, uh, are some
1:10of these live webinars that'll occur throughout the years that you have a
1:14place to come and ask questions and check in with us as things happen.
1:18Um, if you are here for the first time, my name is Josh Gregory.
1:21I'm the Vice President of Operations here at Route Consultant.
1:24Uh, if you're not familiar with our team, we ran hundreds of.
1:27Routes across the country in both p and d and Linehaul.
1:30Uh, and today we're really focused on helping new buyers that are looking to get
1:33into the space for the first time and help contractors to find more efficiencies,
1:37understand everything that's happening in the world of FedEx or whatever
1:40logistics industry they're a part of, uh, and find additional profitability.
1:45So, um, I'm also joined here by Amy Byers.
1:48Uh, many of you might know Amy, but she is a p and d and Linehaul contractor
1:53with routes and runs across the country and has tons of experience.
1:56So she's here as always when we do these to, to bring all of her knowledge.
2:00So Amy, why don't you just give a quick intro on yourself.
2:04Just briefly, uh, my husband David started one man, one van almost 20 years ago.
2:09Uh, and we are now, uh, 240 employees, 200 trucks.
2:13We are in seven, eight terminals in Linehaul and p and d. We have five p and
2:19d contracts all within the same, uh, hub area, which is, uh, very tight regionally,
2:25uh, which is very unique for us.
2:27Um, and we also run line haul, uh, not over the road.
2:30We run local line haul and p and d spots for, for line haul.
2:33And then we also have a custom critical run.
2:35Um, we're building that operation as well.
2:37Uh, we are in 2.0 in one of the contracts right now on the p and d side.
2:43Uh, growing into 2.0 obviously is gonna be a hot topic today.
2:46Um, and, uh, you know, seven days, uh, express.
2:51We kind of have rural, you know, suburban.
2:54I mean, we're kind of all over the place, so, uh, over the
2:57last 20 years we've seen it.
2:58So we're excited to share, uh, as always with the route consultant
3:01and the the contractor network.
3:03Perfect.
3:04And, and today for everybody who's tuning in the format is, is
3:07gonna be a little bit different.
3:08It's not gonna just be us presenting a topic.
3:10We're actually, it's mainly just gonna be q and a where I'm gonna be pulling q and
3:14a. We actually set up a poll in our, uh, social media platforms over the last week
3:18of the topics and questions you guys had.
3:20Um, so we're pulling a lot of those in.
3:22I'm also gonna be taking questions live, so as we're talking, if you have questions
3:26that you want to ask, follow up or, uh, any, any questions of, of Amy and I.
3:30If you put it in the q and a button at the bottom, if you put it in
3:34the, uh, chat button, actually.
3:36Oh man.
3:37Do, is there still a q and a button?
3:40Yes.
3:40Okay.
3:41I see it, but I don't know if it's in there for everyone else.
3:44Okay.
3:45You, you might have to click the more button and then click Q
3:47and a if you're looking for it.
3:49'cause I just was and couldn't find it.
3:51Zoom likes to, to change things up on me when I'm not ready for it.
3:55Um, but yeah, if you have a question, put it in the q and a box.
3:58Um, and Scott, I do see your question.
4:01So that worked and so if you put it in that chat feature, I'm gonna miss it.
4:04But if you put it in the q and a, I'll see it as it happens and
4:07I will ask those questions live.
4:09Perfect.
4:10Um, so before we get into all of that, Amy, um, it actually
4:15is Women's History Month.
4:16That's one of the things mm-hmm.
4:18That we are doing this month in some of our content.
4:20So, um, one of the things that we're really trying to highlight is that this
4:23is an industry, trucking and logistics are industries that are not just for
4:27men that you can be successful in.
4:29Maybe obviously you've been very successful in this industry as you just
4:31walked through, so you don't have to go, you know, uh, a whole dissertation.
4:35But can you just talk a little bit about what you've, kind of, what your experience
4:38has been as a woman in the trucking logistics industry over the years?
4:42Yeah, so it's super exciting.
4:43Um, when I first came on with Dave, he was kind of the ao.
4:47Um, and, you know, it was a guys industry, you know, trucking industry
4:51was, uh, predominantly men, and it's been really exciting to go to, uh, FedEx
4:56conferences, um, trucking conferences, Ohio Trucking conferences, uh, truck
5:01driving championships, and see the amount of not just truck drivers that are
5:06women, but women owners and women aos.
5:08So, um, super encouraging, super uplifting.
5:12Um, it just shows that your business experience and acumen can very
5:17easily transfer into this industry.
5:19Um, and that the, the kind of, the, that barrier is, is lowered now.
5:24Um, it's just kind of a norm.
5:25Um, I actually run into, um, in one of our contracts, we're actually 75%
5:29women drivers, um, as to the men.
5:32Um, so you know.
5:33Go ladies.
5:35Um, but yeah, so I mean, I think it's just cool that the barriers have
5:38dropped, um, and it's just a level playing field, so it's pretty cool.
5:42That's awesome.
5:43Yeah.
5:43And if anybody has follow up questions on that, you can ask, but that's the
5:47main thing I wanted to highlight is that this is not something where if you're a
5:50woman, you're automatically invalidated or having to climb an impossible barrier.
5:55This is something that has, I think, has gotten a lot better over
5:58the years, but, uh, absolutely.
6:00Uh, perfect.
6:01And again, I'm still seeing a lot of the questions come in, in the chat.
6:04I, I can kind of see them and track them, but if you have questions, put
6:08it in the q and a, not the chat so that I can try to stay on top of it
6:12and not have to manage both of those.
6:14Yeah.
6:14Um.
6:15So the, the first topic that I, I want to touch on, Amy, is the one
6:19that I think we get the most questions right now from people who are looking
6:22at FedEx and thinking about how FedEx is changing, which is 2.0, uh,
6:27the new model with FedEx Express.
6:30So can you just at least walk people through what your
6:33experience has been over the years?
6:35'cause as you just said, there's a. A few different places you find yourself
6:38when it comes to 2.0 right now?
6:39Yeah, so 2.0.
6:41Um, just to give a little bit of base history, um, we've been
6:44in, uh, 2.0 in one of our, um, terminals for over three years.
6:50Um, so we were kind of in the very beginning of 2.0 and it's infancy.
6:54So I always joke that it's like 2.5 now because it's kind of gone
6:58through all these kind of iterations and FedEx has come to the table
7:02with some really great changes.
7:04Um, and, and we've had to adapt.
7:06And I think adapting is kind of the number one key, um, to recognize
7:12that you are doing business with a multi-billion dollar business that is
7:16moving the needle to stay relevant, right?
7:19So this is a good thing for us.
7:21If I was doing business with a partner that had not changed along
7:24the way in the last 20 years, we'd be outta business, right?
7:27So the first thing I think is to embrace the change.
7:30And I know everybody's like, oh yeah, right?
7:32Easy for you to say.
7:33Um.
7:34And it's not easy.
7:35Um, it is going to, you know, involve change.
7:38There are going to be redraws and areas that move left and right,
7:42but for our experience today, um, we've always leaned into change.
7:47We've always leaned into kind of what the customer's asking of us,
7:52and it's not always been easy, but the conversations have always been.
7:55Fair.
7:57Um, you know, and we've, we've implemented change.
7:59We've hired more people, we've transitioned.
8:02Um, but I think overall it's brought in more volume.
8:07Uh, you'll hear me say quite often, more small volume
8:10because no one is overnighting a refrigerator, so you're welcome.
8:14Right?
8:14So we're asking for more volume, so it's just growth.
8:17Um, we've been provided more growth area as well as volume.
8:22Um, so for us, uh, it's been a really successful, um, addition.
8:27Uh, the compliances are pretty black and white when it comes to
8:302.0 terminals because it's TSA.
8:32So some of the things in our other terminals that we've had to kind of
8:36fight with the drivers about uniforms and things like that just gets easier.
8:39You just have to do it and everyone in the terminal is doing it.
8:43So.
8:44It kind of, um, it kind of levels the playing field there as well.
8:47Um, so, you know, outside of that, I think, um, just to kind of set the level,
8:53you know, of what to expect maybe when you're going into a 2.0 terminal, um,
8:58is to be transparent with your team.
9:00Um, even if it's, I have no idea what this looks like, hang in there with us.
9:04Um, but I think the big thing that I get from a lot of contractors is how
9:09do they expect me to do exactly what I'm doing now with 10 commits, right?
9:13With 10 30 commits or with noon commits.
9:15Like, there's no way my guy's gonna.
9:17It's not going to be, it's going to change.
9:19It's not gonna get, the guy that's doing 180 stops is not gonna do
9:22180 stops with 15 time commits.
9:25That route is going to change, right?
9:27So I think just the idea of being open to something new and not, you
9:32know, resisting it, is the first step.
9:35Um, they're not layering 2.0 on top of exactly what you're doing.
9:38They're going to shift, they're going to give you some bandwidth for new routes.
9:42Um, and that's a conversation they're going to understand.
9:46Um, stem, right?
9:47Well, I drive an hour and 15 minutes to my first stop.
9:50How the heck am I gonna get to a 10 30?
9:53They have plans in place for that.
9:54They don't expect the, you know, unreasonable.
9:57Um, now they do expect quite a bit, not lying.
10:01Um.
10:02I always just say, you know, hire, hire, hire.
10:04Um, there are going to be people, good people that just don't wanna
10:07change, um, whether they've been in the terminal for a really long time
10:11and this is their exit strategy, or whether they just don't like new, right?
10:16So, hire, hire, hire, stay prepared, make sure you're, you know,
10:19communicating with your teams.
10:21Um, and it just all does start with you, right?
10:24It starts with your leadership, um, and your willingness to serve your customer.
10:30Yeah.
10:31Now you, you did talk about a lot of the good in terms of there's
10:34volume and there's potential growth areas, and, and you talked about
10:38how there's some of the changes.
10:39Um, yeah.
10:40What would you say are the most challenging parts, though, if, you
10:42know, if you're talking about like, maybe some areas, maybe some of
10:45it was just the, the growing pain, but if you're talking about Yeah.
10:48What are the hardest parts about 2.0?
10:50Uh, the hardest parts.
10:51Yeah.
10:52Hardest parts for us is dispatch time.
10:54Mm-hmm.
10:54Um, and it's not awful.
10:56I mean, there are days that it gets pretty bad weather.
10:59Um, our trucks come in from, you know, cold weather.
11:02So cold weather comes into cold weather, so there's a lot of delays.
11:06Um, and it's, and that is, um, that is a, a morale killer when you're
11:12there at eight and they're standing around and it's 10, 10 30 and you
11:16have to be somewhere at 10 30.
11:18Um, the good thing is that FedEx does give you that grace,
11:20but it doesn't change your.
11:21Your staff, um, or your employee's day, right?
11:25They're like, I could have gotten started at nine now I'm
11:27not getting started until 10 30.
11:29Um, and it makes for a long day.
11:31So those are few and far between, but they were definitely more difficult when we
11:35started, uh, we also launched November, or whatever it was, October 28th, right.
11:41Of 2023.
11:43So that was, that was pretty challenging in itself, um, that
11:47it was at peak during bed weather.
11:49Right?
11:50So, um, I think that's probably the hardest part is to just get the
11:54drivers to take a deep breath and know that, you know, on those days
11:58where it gets super late, you might have to put managers in a truck, um,
12:02to provide a little bit of relief.
12:04And it just, you know, they don't happen super often, but when they do it, it's,
12:08you know, people don't like, they don't like late dispatches and these are ex,
12:12you know, can be extraordinarily late.
12:15Yeah.
12:15I I think one of the things I've, I, we've talked about it before is that.
12:19Some of this transition, FedEx is still figuring out too, so you
12:25talked about it right there, late dispatch times communication.
12:28What have you found is the right way to work with FedEx and to communicate to
12:32them if maybe, you know, things aren't going well in the new transition, or
12:36you feel like maybe the new contract isn't properly paying you, like what?
12:39What's the right kind of tone and conversations to be having with FedEx?
12:43Yeah.
12:44So, um, you'll hear from me quite often that, you know, fair and
12:47staying in communication, building those relationships with your
12:49terminal manager and your SPS is key.
12:52Um, you know, uh, they are our customer, right?
12:56So I think that's the big key to always remember, and you'll
12:58hear me say that over and over.
13:00They're not your partner, they're not your friend.
13:02Um, they're not your colleague, you know, they are the customer,
13:05so we need to serve them.
13:08So, you know, my position is if I had these resources, if we could get it right,
13:12I would be able to service you better.
13:15Um, you know, and these are, these are kind of the handcuffs that I'm wearing.
13:18So, you know, document often regularly, um, and try to keep the
13:23emotion and the opinion out of it.
13:27Uh, and just track and then, you know, stay in touch and, and say, you
13:30know, Hey, I'm seeing this pattern.
13:32I'm gonna keep an eye on it, but something's gonna have to change
13:35if this is what we keep seeing.
13:37Um.
13:38You know, so I think those are just, you know, your key and then, and then that
13:41might, you know, lead to a renegotiation.
13:43But I think it comes with not just saying, you know, 2.0 sucks and everything sucks
13:48and you know, it just, it, you're never gonna get an audience or respect that way.
13:53Yeah, I mean, and, and to a certain extent, I'm sure there's plenty of people
13:56at FedEx that agree, they think 2.0 sucks.
13:58They think that this transition is not a fun trans only,
14:00maybe difficult to correct.
14:02Yeah.
14:02What I would say, like, the transition's not fun for anyone.
14:05They, everyone may see that, hey, 2.0 is where we need to go.
14:08That, that end goal looks great, but no one's loves changing everything
14:13for everyone and having to deal with all of the, like, you know, a senior
14:15manager's getting complaints and challenges from everyone at the terminal.
14:19'cause nobody's happy when you have to change stuff.
14:21But I think there is a, a reality of let's work together on this and
14:26make sure that if there are things to hold FedEx accountable to, to
14:30understand how you can do that and have a productive conversation there.
14:33Because it doesn't mean just like, oh man, we both think this isn't fun, so
14:37let's just not say anything about it.
14:39It, it is important to make everything work seamlessly as a partnership to, to
14:44highlight the challenges and like you said, find fair and constructive ways to
14:48talk about it and bring data when you can.
14:51And when you realize that you are the vendor and you're serving
14:54that customer, um, you know, it changes the game a little bit.
14:58How you treat your fuel card vendor, your workers' comp vendor,
15:02your payroll vendor, right?
15:04Your, your truck vendors, your insurance, whatever that looks like,
15:07those are your, you're their customer.
15:10So it kind of sets the tone that, you know, sometimes change isn't
15:13good, but you need your vendors.
15:15FedEx needs us, but we also need them.
15:18Right.
15:18Like, I got a lot of trucks without FedEx, lemme tell you.
15:23Right?
15:23Yeah, that's true.
15:25So if you're, let's say you're somebody new who's coming into this space, and
15:28maybe you've bought a business that you're expecting to go to and 2.0 soon,
15:33or maybe you, you've, it's already just gone 2.0, but you're early.
15:37Are there any tips or kind of operational things you tell people
15:40to focus on as kind of the first step when they're getting into 2.0?
15:43Yeah, just, um, figure out service, you know, um, and then,
15:47and then streamline from there.
15:49Try to maintain your service, learn your pickups, learn the timing, and
15:52just keep sharpening that pencil and keep, you know, and not, obviously, you
15:57know, you can't throw finances to the wind because you'll run outta money.
16:01Um, but you know, you may have to work a little bit harder in the beginning.
16:04Um, and I always say it's not harder, it's different.
16:06But if you're coming in new, um, I think that's a great place if they'll
16:10allow you to come in new before 2.0.
16:13'cause it allows you to kind of level, set and right size as to what your
16:18contracted area looks like today.
16:20And then you can make the change to 2.0.
16:23Um, if you're jumping in and it's, um, you know, regular and then 2.0, it gets
16:27a little bit muddy and it's gonna be a little bit, um, bumpy along the way.
16:31But I would just say focus on learning the business.
16:34Focus on saying yes to the customer.
16:36Um, there are fairly forgiving customer when you're trying Yeah.
16:39Right.
16:40When, when you actually try and you're, you're not just like, screw you the
16:43stocks, you know, I'm not doing it.
16:45Um, dig your heels in.
16:46When you're leaning in and you truly are showing progress, um, they're, they're,
16:51you know, they're pretty understanding.
16:53Okay, perfect.
16:54Yeah, I, I see a question from Scott that's kind of a follow up here.
16:57It, when you're thinking about how you've grown with Express, there's
17:01no way, I know that you can give like a, you can get an, an exact
17:04percentage growth to expect, but Right.
17:06Can you give a sense of the ways that Express has allowed
17:09you to grow and two point Yeah.
17:11So.
17:11So when we first, um, when we first started, um, we actually
17:15were a very small contract, um, you know, nine to 11 routes every day.
17:21And my manager had actually said to me, man, this would just be so nice.
17:24Um, we were six days a week and he was like, it would just be really nice if
17:28we could get that volume and growth that we could put another BC on so
17:32that they both didn't have to work.
17:33You know, the one didn't have to work six days.
17:35We could kind of share responsibilities.
17:37If there was a call off, we could have coverage.
17:39He's like, it just, we just don't have enough stops to, or routes
17:44to support another supervisor or BC in that, in that contract.
17:48So for us, the 2.0 brought the volume that we needed.
17:52We got that 200 to 300 more stops per day.
17:56Um.
17:57Again, the small boxes were nice.
17:59Um, you know, and it, and it was different.
18:02Not, you know, it was different, not harder.
18:05Um, but we did, we went from, you know, nine to 11 to 13 routes and it kind
18:10of got a little bit easier for us for coverage for, for the split schedule.
18:16Um, and then because we were doing well, we actually got, um, they.
18:21Redistricted a another terminal's routes and kind of pushed them into ours.
18:25And we touched up against it because we were doing so well.
18:28We were awarded those routes.
18:29So then we grew by two more routes and then more came and we actually
18:33grew by more routes than that.
18:35So I think we're running 17 or 18 routes per day now.
18:38Two managers, right?
18:39We have a, a full BC and then a full supervisor that work.
18:43Um, we run just a few routes, um, on the seventh day, so we're not
18:48fully staffed on the seventh day.
18:49So it's just made things really solid for us.
18:53Um, the revenues there, um, coverage is there.
18:56Uh, we don't have any, you know, major sweep routes.
18:58We do have a bulk route.
19:00Um, but that route also sweeps, um, some pickups and kind of is more
19:04of an industrial route as well.
19:06So we've been able to, um, really kind of leverage the growth, not
19:11just from stop volume, but from area.
19:14Um, and now we're, you know, and it at that kind of sweet spot of like 17 to 20
19:19routes is when you can start really, um, making some impact and making change.
19:24I think when it gets bigger than 20, and we are, we have some contracts
19:28that have 34, 40 routes a day.
19:30Um, those are, you know, obviously a challenge to, to manage for
19:34one, one reason or another.
19:35And then some of your smaller contracts are also, um, difficult because when
19:39you run a small contract and you're lean, um, call offs and things like that
19:44can really kind of put you in a bind.
19:46'cause you don't have a deep bench of extra resources.
19:49There's not, oh, let me just collapse this route and we'll be good.
19:52Um, you're kind of running, you know, nine for nine or 10 for 10.
19:56Um, so, you know, so that sweet spot.
19:58So it, it really did provide us, um, you know, some stability,
20:01which I really enjoyed.
20:04Uh, another question here from, uh, on the 2.0 side.
20:08Um, when you were going through the transition, was there ever any time
20:13where you thought you might lose territory or were there conversations
20:16about that or anything like that as you were going through it?
20:19So in our existing contract, no.
20:21Um, in one of our contracts that we're going to now, um, we've
20:25been told that we are going to be redistricted, um, or re redrawn, right?
20:31Mm-hmm.
20:31That's the word.
20:32Um, so they're gonna redraw some of our area.
20:34Um, there's also a new terminal being built nearby, so there's a lot of change.
20:41Um, but from what we understand is we're gonna maybe lose two
20:45and push into maybe two or three.
20:48Um, so we haven't, you know, had like a net negative.
20:51Um, and then add the volume on top of that.
20:54We should be at a net even, or a net positive with where
20:57we were, where we are going.
20:59Um, and again, that all has to do with.
21:02How you're currently servicing, right.
21:04Um, you know, so, you know, stay solid, stay, um, focused
21:08on your current contract.
21:09Get it right today.
21:11You'll hear me say that, right?
21:12If you're, if you can see the horizon right?
21:15June, July, August, September of this year, if you can see what's
21:19coming, um, you know, get your house in order, if you will.
21:23Yeah.
21:23So that you're ready for it.
21:25Yeah.
21:25Very much a time to make sure that you are shoring up your business
21:29so that you can prepare for change.
21:31Um, yep.
21:32You know, both to make sure you are hitting all the metrics FedEx has so that
21:36the changes as positive as it can be, and also that as operational things happen,
21:41hopefully if you've kind of eliminated any of the normal day-to-day challenges
21:45in your current business, as you make the 2.0 transition, you can just focus
21:48on those new challenges and get that handle, you know, as soon as possible.
21:52Yep.
21:54Um, one of the things too, you know, I don't, have you seen any express
21:58drivers, you know, maybe a, they close an express terminal nearby.
22:01Is that something where it's an employee employment opportunity where
22:04you're picking up express drivers?
22:06Or has that not been the case?
22:07So we, when we first did the transition, they brought in like
22:11all the express terminal drivers.
22:14Mm-hmm.
22:14And we're like, Hey, you know.
22:16These are the guys that are gonna be, you know, looking for work.
22:19Yeah.
22:19Yeah.
22:20Um, and they ended up using those guys as couriers.
22:23So I don't know what that looks like in other terminals, because like I said,
22:26we're moving into kind of this new normal.
22:28Yeah.
22:29Um, we have hired in the past, gosh, two months, three express drivers.
22:36Um, so they were, you know, they were in zuzu reach trucks and, you know, they kind
22:41of popped right into our business routes.
22:43Mm-hmm.
22:43They're already time commit savvy.
22:45Yeah.
22:45Um, you know, the big issue is they're Monday through Friday typically.
22:49So, you know, going into a business route actually works for them.
22:52Um, but you know, really good guys.
22:54I have a guy that's picking up six days, um, very regular, fairly regularly,
22:59um, enjoys the Saturday work with no pickups, but, you know, they're trained.
23:03Um, we do have to put 'em through the CT class and kind of treat them as an
23:06existing driver recert and, and put them through the road test and everything
23:10because they are two different systems.
23:13Um, and it is a little clunky to get an express driver de expressed
23:19deactivated in their system and then activated in the, the, um.
23:24Independent contractor program.
23:25Um, so it's just, it's a little bit, uh, different.
23:27But yeah, I think there's gonna be, you know, I think it's gonna open up a
23:30huge, um, amount of experienced drivers that are already used to a little bit
23:38higher standard than the ground drivers.
23:41Um, you know, in the past have been held to.
23:44Okay.
23:44So it's good.
23:45Good stuff.
23:45Good stuff.
23:46Okay.
23:46Yeah.
23:46Really good stuff.
23:48I'm sure there'll be other questions on 2.0.
23:50I just don't wanna spend this entire time on 2.0.
23:52Yeah, yeah, yeah.
23:53But that, that kind of leads us to the next one already.
23:55So we're talking to employees, you know, if finding express drivers
24:00isn't the challenge, but what would you say today and, and maybe in 2026
24:03in general, feels like some of the biggest challenges when it comes to
24:06retaining and finding good employees?
24:08Uh, yeah.
24:09So for us, um, wages versus quality of, of the talent, I think that's out there.
24:16Um, wages are higher than ever.
24:18Uh, we actually started, um, probably, I don't know, six to eight
24:23months ago, not hiring any entry level drivers, um, unless they were
24:28referrals from friends or jumpers or Packet Chandler that knew us, right.
24:34That we kinda had a relationship with already.
24:36Um, we even changed our, our ads, our job ads, um, our job portals,
24:42everything to kind of get this.
24:44Tenured driver, uh, between the safety and just the turnkey.
24:50Um, for the, for the entry level driver that was looking for a higher
24:55wage for 10 or $20 more a day, you're getting a better quality driver.
25:01Um, and hopefully that'll trickle down to your Schedule L right?
25:04Your, your safety score.
25:06So you hire, you spend a little bit more on the front end and you have
25:08less incidents, accidents and issues.
25:11Um.
25:12We've also been, you know, um, I think one of the other things is there was a lot of
25:16people that were unemployed in the early 2025, um, timeframe that caused quite a
25:22bit of strain because you're hiring people that really didn't have anything to lose.
25:26'cause they were already right.
25:28Where if you hire someone that's already employed, um, they're gonna
25:31think long and hard about making a decision to come work for you.
25:34So they're a little bit more vested because they don't wanna give up
25:36a career that's already good and decent, um, you know, to, to try out.
25:42FedEx delivery.
25:43Um, and then one of the other things is then in Ohio, um,
25:47uh, marijuana was legalized.
25:49Um, so that's, you know, that's been a little bit of a challenge.
25:53Um, and just having an open conversation with people to say like, Hey man,
25:56I don't judge you for smoking weed.
25:59Right.
25:59I don't, I get it's legal and that's your pastime.
26:02Um, but you can't do it when you're federally regulated.
26:05Yeah.
26:05So if you wanna work for me, you have to get clean and you have to stay clean.
26:09Um, and tho those are conversations, you know, and sometimes the
26:12conversation is, is like, I never did, I never had a reason to stop.
26:16Right.
26:16Yeah.
26:16Other trucking vendors don't drug test or other companies don't drug test.
26:20So it was never really an, an issue.
26:23But, you know, I want a career, so I'm gonna do this with you.
26:26Or it's, you know, no, I enjoy my pastime and move along.
26:30Um.
26:32You know, but I think that's part of, um, in Ohio that's been
26:35kind of the issue that we've had.
26:37Um, and then, um, you know, um, it just, the wages, the wages have
26:42just inflated well beyond, um, you know, general, uh, inflation
26:47or cost of living, um, increases.
26:49So that's made things challenging.
26:51Um, the, the influx of contingency, and we do run contingency runs, but the
26:56influx of contingency in DCA routes and things like that have definitely added to
27:01the mix of, of a, of an increased wage.
27:04Um, but we kind of bring people on just to, to kind of tell you what we've
27:08done to counter that is we've brought people on in a staggered wage increase.
27:13So we'll bring 'em on kind of a training wage, do an increase once they're
27:17independent, which means that they can come into the terminal, get their
27:20ground cloud and things started, get out of the terminal independently.
27:24Not that they won't have questions, but they can do the majority
27:26of their work independently.
27:28And then we'll review them when that happens and, or 60 days.
27:32Um, and then we'll do, you know, an annual review after that.
27:36But I think starting them at the top and then them falling short is also a risk.
27:42Right?
27:42Well, you have four years experience doing this.
27:44That doesn't necessarily translate Yeah.
27:46Right.
27:47To what we do on the, on the pickup and delivery side.
27:50So to stagger someone and set some really clear benchmarks,
27:54I'm gonna start you at 50 stops a day, but I need you to do one 30.
27:58Right.
27:58So it's just these conversations and expectations for, for this new,
28:02um, kind of higher, uh, increased pay wage that we're up against.
28:07And, and quickly, one of the things you touched on, so I I know that drivers
28:11all have to like, get drug tested.
28:14Does the same apply to AOS and owners?
28:16Mm-hmm.
28:17Okay.
28:17Yes.
28:17So if you're on the business, you could get drug tested.
28:20Yep.
28:21Yeah.
28:21Yeah.
28:21You're in the system.
28:22You're, you're official.
28:24Yeah.
28:25Uh, so on the, the retention side, what are the strategies
28:29you've used over the years?
28:30'cause I know you, you have some of the longest tenured
28:32employees of a lot of I do.
28:34Contractors I talk to.
28:34So what are some of the things you guys have done over the
28:36years to, to build that culture?
28:39So we, um, obviously from a benefits and, and wage side, obviously
28:43we're constantly reviewing wages.
28:46Um, and, you know, there's always that question, you know, paying somebody $20
28:49more a day, what does that look like on the week when you have to then hire a new
28:54person, train them, get them in, you know?
28:57So when you take a look at the investment you're making in a good
29:01person, um, or a strong driver, what does that look like compared
29:05to losing them over 10 bucks a day?
29:07Right.
29:07So, so wage, obviously competitive wages is number one.
29:11Um, we also offer, um, full medical benefits.
29:15Um, we offer, uh, ancillary benefits.
29:18We offer 401k with match.
29:20Um, and then we have other benefits that we pay for.
29:23That slicker pays for a hundred percent like an EAP,
29:26an employee assistance program.
29:27Um, we, uh, offer a Ramsey Smart Dollar to our drivers because.
29:33A lot of you don't pay me enough is you don't manage your money well.
29:39So if we can work together to, to give them a strong wage, but then also give
29:44them ways to get ahead financially, um, that's where we wanna, we wanna get
29:48there together, um, and supporting them, um, you know, depending on wherever you
29:53are in your life, whether it's paying your car off or buying your first car,
29:56or, you know, going through a divorce and trying to kind of figure out what
29:59that looks like today or child support.
30:02Um, so we're constantly trying to offer those services to kind of better
30:06the culture at Slicker Trucking.
30:08Um, open door policy, we, um, have processes and, um.
30:13Reporting procedures for anything anyone could possibly need.
30:16Right.
30:17So, um, you know, from uniforms to, um, conflict resolution, uh, we have
30:23a place that they can go to feel safe and report and get what they need.
30:27So responsiveness is key.
30:29Um, and then all the benefits, um, you know, that we, that we
30:32have as a company and we do.
30:34I hear, I hear we throw one hell of a party we're told.
30:38Yes, you do.
30:39That's awesome.
30:40So, so that's always a hook, I guess.
30:42Yeah, that'll do.
30:43Hey guys, we just wanted to pause for a moment to invite you to our free events
30:46that are happening throughout the year.
30:48Whether you're just getting started in the logistics industry or you're
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30:55So head on over to route consultant.com/events or check out our
30:58show notes to register for free today.
31:01Also, while you're here, don't forget to like and subscribe to the Industry
31:04Insights with Route Consultant Podcast so that you don't miss out on the stories,
31:07the advice, and the updates that are happening throughout the industry.
31:10We appreciate you being here and hope to meet you in person soon.
31:13Now let's get back to the episode.
31:15Now are there any specific incentives that you use for your drivers or
31:18bcs that you know, beyond just the, the typical pay structures?
31:23Yeah, so we do, um, so we got away from stop bonuses because we do have
31:28a chunk of rural and we have a chunk of kind of residential and then we
31:32have business routes and to do stop thresholds, um, you have to kind of
31:37manage those individually, right?
31:38Like based on the complexity of the role.
31:41Um, and for us at Slicker, yes, there's some differences between somebody that
31:46can, you know, drive a P 1200 and slay 300 stops versus someone that's in
31:51a box truck and can only do one 20.
31:53But the core value of the human that works for you is the same, right?
31:58I need someone to drive 210 miles a day and deliver 40 boxes, and I need somebody
32:03that drives 40 miles and can do 210 boxes.
32:06And those humans, those people that work for me have a value.
32:10There's a base value.
32:12So we got away from stop thresholds, um, quite a while ago.
32:17Uh.
32:17I would probably say five or six years ago, as well as the fact that that does
32:21in Ohio change, um, hourly wages and the recalculation of overtime, which I could
32:27spend an entire session on that alone.
32:30Um, so we're gonna get away from that.
32:32But we bonus for culture.
32:35Um, we bonus for doing the right thing, and we try to stay away
32:38from bonuses and lean more towards interim and annual reviews, right?
32:44Like you don't need a bonus, you get a paycheck every week.
32:48You're welcome and thank you, right?
32:51Every week on time, you're welcome.
32:53Um, but when you go above and beyond, say you're done at four or five o'clock,
32:57and a truck breaks down, and you go and, and take the rest of those stops,
33:02or pick up that driver or sweep their pickups and help us serve the customer,
33:07help us maintain service, help us maintain safety, whatever that looks
33:11like, that would then receive a bonus.
33:15Um, and then all of those things like the everyday driver duties, hitting
33:19your thresholds, making service, you know, lytic, low lytic scores
33:23or better scores, um, you know, low truck maintenance, unnecessary truck
33:27maintenance, all of those things are gonna hit your annual review.
33:31Right?
33:32And you should be able to do that without what I like to call a bribe, right?
33:37Because bonuses can be bribes.
33:39Um, and then on the BC side, we are changing kind of our.
33:43Our program a little bit, um, because the bcs need to be ultimately
33:48responsible for the service and the KIS at that terminal, right?
33:53When there's high turnover or there's low service, um.
33:58It's not just happening, right?
34:00It's not just like, oh my God, service is bad.
34:02No, no, no.
34:02It's not just happening to you.
34:03You are running this ship.
34:05So similar to other franchise markets, they're going to be held to the KIS
34:11and the statistics at that terminal.
34:14Um, and then we're gonna establish a bonus program for them based
34:17on a quarterly performance.
34:19So, you know, three months of gold or three months of silver have different
34:23weights, um, making service, making pickups, PPOD scores, ride scores,
34:28um, but also holding them to things like unnecessary bonuses, right?
34:33Like, are you not setting the team up for success?
34:36And then I have to go ahead and bonus people just to get the work done.
34:40Um.
34:41Excessive overtime or any overtime if that's, you know,
34:44the way turnover and hiring, are people being trained correctly?
34:48The length that takes people to get ramped up, right?
34:51Does it take somebody three or four weeks to get trained or can I get somebody
34:54in and in two weeks you've done an excellent job of training them, right?
34:58And they're pretty turnkey.
35:00Um, and then the manageable workloads, making sure people are working a
35:03full day, um, limiting bulk routes and things like that if possible.
35:09Uh, putting people in the right trucks, um, and then just communicating with us.
35:12So all of those things are going to be part of, of kind of our
35:17BC KI and profitability plan.
35:20Um, so I'll share more on that when we get, when we get there.
35:23But those are, those are things that we're working on in 2026
35:25instead of just the core, you know?
35:27Are you guys hitting 99.7 every day?
35:29Okay.
35:29Um, there's a lot to manage today.
35:33From PPOD ride signatures, like there is a lot, there's a lot of moving
35:37pieces in the p and d, um, BC's world.
35:40Um, you know, drove all the things, uh, inaccurate, drove all, all the,
35:44all the things that kind of contribute to a challenging day for them.
35:49Um, I also bonus on, um, how often they stay out of a truck.
35:53Um, that means that they've done their job right and they can get to managing
35:56the business the way I need 'em to.
35:59And the more they are managing the business, the more I can step
36:02away and work on what's next.
36:06Yeah.
36:06And do you find that you have completely separate drivers and managers between
36:12p and d and linehaul, or is there some overlap of abilities and skills there?
36:17We do have overlap, but we have them completely separated.
36:20Our senior, so we have a layer of senior managers between the
36:24local bcs and Dave and I. Mm-hmm.
36:27And those guys are kind of cross-trained and cross cover.
36:30Um, but for the most part, they're pretty much s you know, separate, um, to manage
36:35those individual lines of business.
36:36'cause they are super different.
36:39Yeah, they are.
36:39And Linehaul is 24 hours a day, so that's always fun when the, when the
36:43p and d guys are like, I'm gonna bed.
36:44Um, but they're up doing drill.
36:46So it, it has their, it has the timing challenges.
36:49I always say that being a BC in this business is different than being
36:52a manager and any other business.
36:55Um, you know, phone calls come in at night, um, because that's when your
36:59drivers are off work and thinking of things that they want from you.
37:02Mm-hmm.
37:03Um, yeah.
37:04And then, you know, and the call ops come in, in the middle of
37:06the night, middle of the morning.
37:08Um, so it's a, it's just a different animal.
37:10It's definitely, um, a, a different type of manager that you need.
37:13Okay.
37:15So, so let's jump off of employees.
37:18Let's talk a little bit about trucks this year.
37:21So how are, how, I think you typically have kind of a yearly
37:26annual refresh type of mm-hmm.
37:27At least review of your fleet.
37:29So how do you think, how are you thinking about your trucks and your
37:31strategy around them in 2026, I guess p and d versus line haul separately?
37:36Yeah, so our linehaul strategy is totally different than anybody else's.
37:40Um, we don't go very far on our line haul.
37:44We're local, so I think the furthest we drive is maybe three hours, one direction.
37:48Um, and then back.
37:49So I don't need a $200,000 truck.
37:52I don't need $130,000 truck.
37:54Um, so we have kind of a used, um, truck and, you know, replacement.
37:59We kind of buy in at two, 300,000 miles and kick 'em out around nine.
38:04900,000 to a million.
38:06Um, and then we have our own maintenance staff.
38:08We have our own tow truck, so we can really be responsive in that way.
38:12We're also regional, so if there is a breakdown, like I'm never going,
38:16oh my gosh, I'm in Ohio and my guys in California, what do I do?
38:20Um, you know, we're, we're fairly regional, so my guys at night are
38:24kind of problem solving on their own.
38:26Um, they have to drive by one of my seven terminals at any
38:30time throughout the night.
38:31So they are just an hour away from any extra spare truck that I have available.
38:36So it's a completely different strategy in that, in that, um, regard.
38:40Um, but we do, like right now we are in the process of buying
38:43eight new trucks and kind of decommissioning eight other trucks.
38:46Um.
38:47And that's gonna happen probably, I don't know, maybe, um, may or June.
38:52Uh, we'll, we'll start working on that.
38:54On the line haul side, p and d, we always buy new in September, October.
38:59Um, and then we keep our existing trucks in and use them as rentals through
39:04Peak, and then we start selling them in the January, February timeframe.
39:09Peak lasted a little bit longer this year because of weather, so we're
39:13getting into selling those trucks now.
39:15Um, but we bought, you know, we took on a new contract, so we bought, you
39:19know, over 30 brand new trucks, um, in a few used trucks, um, in October.
39:24So we'll be kind of moving through those.
39:26Um, you know, I think the big issue, um, that we have now is fuel, right?
39:31Yeah.
39:31Yeah.
39:32I mean, I think that's just hitting everybody at the pump.
39:34Um, and I think the big thing is, um, that the new trucks that we're buying,
39:39um, you know, unfortunately they're just not like they used to be built.
39:43So we're finding that brand new trucks are breaking.
39:47You know, pretty, you know, regularly as well.
39:51Um, whether they come in and have a couple electric electrical issues or they
39:55come in and have some factory, whatever.
39:57Um, so it's been keeping our, our maintenance staff, you know, pretty busy.
40:01We hired two more mechanics, um, to keep 'em a little bit more regional.
40:05So even though we are regional, a little bit more regional, um, so that they're
40:10only really covering about an hour a time.
40:12Each person.
40:14Um, and then, you know, really leaning into, um, in 2026, additional ways to
40:20maximize mileage and, um, fuel efficiency.
40:24Um, and then, and then also, you know, just really leaning
40:28into new vendors, right?
40:30Finding vendors.
40:31Um, we can't do all the work on all the trucks.
40:33Some of them are under warranty.
40:34So making those relationships, um, finding vendors, finding way to save,
40:39whether that's nitrogen in the, in the tires or fuel supplements, um,
40:43you know, whatever that looks like.
40:44We are constantly looking for ways, um, to leverage not only the truck
40:49health, but the, the cost savings.
40:53Mm-hmm.
40:54Yeah.
40:54And I, I know that's, that's really all you, you can't say that, you
40:59know, fuel is gonna be cheaper.
41:00We don't know when it's gonna be cheaper.
41:01So you're trying to do everything you can to.
41:03To mitigate all of those that you can.
41:05Yeah.
41:06Um, it, have you gotten much into electric yet?
41:09Is that a part of your strategy?
41:11So, yeah.
41:12Yeah, so we have one, um, we had a, we have a bright drop, um, and then we
41:17are now testing a harbinger, um, P 700.
41:22Uh, it actually just got delivered, so we're super excited
41:24about learning about that.
41:26I will say electric is a little tough in our winter that we had this year.
41:31So we had like 19 days of negative, like greater than, or I
41:36guess lesser than negative five.
41:38It was like negative 12, negative 11, um, which just doesn't.
41:42Electric.
41:43Just doesn't like any of that.
41:45None of that.
41:46Um, but it, but they're cool trucks.
41:48Um, and it is nice to know that, you know, um, the electric bill,
41:52um, did go up a little bit.
41:53Uh, we're still working.
41:54Like I said, we got that in October.
41:56Yeah.
41:56Um, and with the weather it just kind of changed things.
41:58So we don't have the data that I would like.
42:01Um, but having the two trucks side by side, um, you know, the
42:05Harbinger truck is, is beautiful.
42:06It's big.
42:07Um, it, we're really excited to get it on the road and kind of
42:10see what that's gonna look like.
42:12Um.
42:13And then, you know, we have a need for, for some trucks going forward.
42:16So that might be, we may be leaning into electric, um, you know, our
42:20guys can get certified to fix them.
42:22So that kind of takes the pressure off of where we were last year
42:26when we wanted to go electric, um, like 12 months ago last year.
42:30Um mm-hmm.
42:31It was just, you know, who's gonna fix 'em?
42:32Where are we gonna get parts?
42:33And everything is just much more readily available.
42:36And, and programs like Haring or they have like training programs,
42:40so they'll literally certify our guys and we'll be able to.
42:43You know?
42:44Yeah.
42:44Continue to work on things like that, so, so yeah, more data to come.
42:48Um, you know, I'm a data girl, so I'm like, where, where are the numbers?
42:51And they're like, well, that day it, like, we didn't even get 40% charge out of it
42:55one day because it was just like, so cold.
42:58Yeah, it was so cold.
43:00It was just so cold.
43:01I'm like, if the truck doesn't wanna work, how can I make my employees wear record?
43:05Geez.
43:07Yeah, that's fair.
43:09Um, also, Joseph, I, I saw you raising your hand.
43:11If you have a question, if you'll just send it either to the chat
43:14or the q and a and, and I'll, I'll make sure to answer it.
43:17Um, okay.
43:19So we've got about 15 ish minutes yet left, so, uh, we'll, we'll get to
43:25some, if people have other questions about trucks and, and fuel this year,
43:30feel free to, to send 'em in the chat.
43:32Um, one of the things I wanted to talk about, and I see a, a few questions
43:35around it, is around, um, purchasing and, and getting into the space.
43:40Yeah.
43:41One of the things though, before we get too far into that, I saw this question, I
43:45thought, you know, we'll start there, Amy, if you were new, what do you recommend
43:49for a first time contractor, p and d or a line haul since you've done both?
43:53Um, wow.
43:55So, so everybody asks me, which is better, right?
43:59Um, and I say it's, it's frequency and impact, right?
44:04Um, linehaul has less moving parts, but the parts are bigger.
44:08Um, and when there's an issue, it's a big issue.
44:12Yeah.
44:12Um, you know, you only have to worry about a mailbox, mostly on the p and
44:17d side, you know, as far as accidents, but your staff is different, right?
44:20You have higher quality staff, not quality, but higher trained professionals
44:25in the line haul space versus, you know, a guy that's done Uber or delivered
44:30or landscaped for a couple years.
44:32Um, so I would say from an.
44:36Ease of operation.
44:38I would, and a maybe a learning curve.
44:40I think p and d is easier to get into.
44:42It's also more readily accessible, right?
44:45Linehaul iss a little bit harder to get into.
44:47Um, you know, and if you don't have any logistics or professional semi-truck
44:52training, uh, line hall's gonna be a little bit difficult for you to
44:56understand and run outta the gate.
44:58Um, now if you have a BC and you're just buying as an investor, right?
45:03They're kind of both the same at that point.
45:05Um, p and d has a lot of moving parts.
45:09Um, so if there's not a, if it's not a successful, uh, operation that you're
45:13buying, it can get, it can get bumpy and you're gonna have to roll up your
45:16sleeves or have someone that's going to roll up their sleeves on your behalf.
45:20Um, so I think that that's, you know, kind of where the rubber meets the road.
45:24I don't know if I answered that correctly.
45:25No.
45:25Yeah.
45:26No, that's good.
45:27You know, I would add to people who are thinking about Express, I, I think the
45:312.0, um, it does have opportunity for you to buy in before the volume gets there.
45:36So there's that upside.
45:38But if you're worried about a bunch of changes in 2.0, line Halls.
45:41Line Hall's not really experiencing much operation change from 2.0.
45:46But it's, it's also not getting a ton of growth from 2.0.
45:48Correct.
45:48So it's more moving forward as expected.
45:52And in general you'll find that growth in Linehaul isn't as,
45:56um, you know, kind of chunky.
45:58It's more of you choose when you're wanting to add runs and, and that can
46:01feel different, um, in terms of what you want and where you want to be.
46:06There's, there's different, you know, there's a a hundred different ways we
46:09could take that conversation and the people versus Linehaul conversation.
46:12But I think when I think Linehaul growth sometimes comes at a non-contracted.
46:18Um, you know, kind of comes in a non-contracted package.
46:21Yeah.
46:22Um, where like we have 21 contracted routes, but we run 20 spares.
46:26Yeah.
46:27Um, some people see that as risk.
46:29I run the same spares for, you know, five years.
46:32Um, and we've continually grown it.
46:34So if you service it well, it becomes kind of yours, but yes.
46:38Is it contracted?
46:39No.
46:40Um, you know, could they flop it somewhere else?
46:42Well, yeah, if I wasn't servicing it, um, or if the volume dips.
46:45But, um, that's a risk that, you know, we kind of take on the line
46:49haul side that isn't necessarily translated on the p and d side.
46:53Um, when you grow on p and d, it's typically a contracted area.
46:55Even if it's temporary, it's contracted, whether that's contingency or DCA, um,
47:00it's contracted for some reason, where on the line haul side, you show up with a
47:04truck if you're already in and you show up with a truck and a guy and it's onboarded.
47:09They'll use you.
47:10Yeah.
47:10And then they just keep using you and, and you know, sometimes it's contracted.
47:14Sometimes you can like turn that into a contracted run or,
47:17um, whether that's dedicated or unassigned, um, or even city work.
47:21But that's kind of, um, the contractual difference, um, is that, you know,
47:25sometimes, uh, those runs aren't on paper.
47:29Yeah.
47:30Now, what I'm seeing from several people, just to, to make sure you understand
47:34kind of what types of opportunities there are to get into this space.
47:39Most of the one, so route consultant, we have businesses for sale.
47:42If you go to our website, you'll see 'em.
47:44The vast majority of businesses we have for sale, FedEx, Amazon Bread,
47:47whatever industry it is, are businesses that you're buying where you're taking
47:52over the business and transitioning control, but then you're inheriting
47:55the people, the trucks, the contracts.
47:57Mm-hmm.
47:58There are times where you could get businesses that are, you know,
48:04basically you're, it's a startup almost.
48:06Um, there's a site with FedEx called Build aground Biz,
48:09where you can find free routes.
48:12Um, those will typically not be the routes that you see from us.
48:15Um, what those mean, you know?
48:16So, Amy, if you could walk through a little bit of the difference between,
48:20you know, what does it mean when you're starting with a, a business
48:23versus if you're trying to, to start from scratch with FedEx for free.
48:27Yeah.
48:27So, um, first of all, caveat free ain't free.
48:32Okay, let's just, let's just put that, that one to bed free is not free.
48:37Um, and if you're new, like have no experience, um, coming from the
48:41outside, whether you're a different type of entrepreneur and you're
48:44just coming into the space, free is very clunky and it's very expensive.
48:49Yeah.
48:49So free ain't free.
48:51Um, so when you come in, um, and you buy like a route, consultant route, or
48:55you're buying an existing operation, um, there's a lot of infrastructure.
48:59Maybe it's not perfect.
49:01Um, you know, we have different levels.
49:03You're buying an existing business, somebody just wants to retire
49:05and it's all operational and everything's good and good standing,
49:09or you're buying a fire sale, which.
49:11Also is kind of a step in the, at least the right direction.
49:13There's some foundation, um, to start with.
49:16Um, but starting up new, I will tell you, we took on an opportunity in October
49:21of this year, and after 20 years, free wasn't free and it was challenging.
49:25Um, we stood up, you know, October.
49:28Oh my gosh.
49:28It was like the midweek of, or middle of the month and peak hit and
49:32you know, it was like ramping up.
49:34There was a staggered ramp up.
49:36Um, you know, so it was, it was challenging even for us.
49:40Um, and we've been in it 20 years and we've done this, you know, 10, 15
49:44times, um, where we've kind of stood up and kind of moved pieces and grown
49:49and, you know, done contingency and turned the contingency into a contract.
49:53Um, so I would say, you know, the stress of starting from scratch, um, when you
50:01just don't have the knowledge of the network and the tools or any types of
50:07resources, vendors set up relationships.
50:11I mean, it's, it's a struggle.
50:13Um, so.
50:14What I tell people is buy in, buy into a solid operation that you can learn.
50:19Get your feet wet, make some revenue right outta the gate.
50:22Be in the green.
50:24Right.
50:25Stay in the black, right.
50:26All those good things.
50:28And then, and then from there, take on a free area.
50:31Right?
50:31Right.
50:32And then you can leverage that investment over to operations.
50:36Um, but you've also got, you got some resources that you can kind of lend.
50:40Um, you have the knowledge, the experience.
50:43And that's where that organic growth comes in.
50:46Right.
50:46Um, and, and we've, you know, we've bought in, we've, um, I, I
50:50joke now and I say we're not in the buying routes game anymore.
50:53We're big enough that we can kind of lean in, but we're still buying in, right?
50:57Like, I didn't pay for that new contract that we stood up for with in, um,
51:02October, but I paid for it, right?
51:05Yeah.
51:05I had to buy, I had to buy 17 new P one thousands and, you know, a couple
51:08straight trucks and I had to hire and I had to buy, you know, 20 scanners
51:13and 20 iPads and do a data plan for 20 more, you know, devices and 20 more,
51:19uh, ground cloud accesses, you know?
51:21So I mean, it's free, free, yeah.
51:23Um, you know, but, but that's an investment that you make.
51:27You know, my portfolio is now that much bigger.
51:30Um, and, and my revenue stream this year will be that much bigger.
51:34Um, I said yes to the customer.
51:35Hopefully that will translate, you know, as it has in the last
51:3919, 20 years, um, by saying yes.
51:41And positioning ourselves, you know, in a way to, you know,
51:45burden some of that hard work.
51:47Um, but you're gonna pay for it one way or another.
51:49It just, yeah.
51:51You know, is it, is it structurally sound and is there a foundation
51:54or are you starting from scratch?
51:56Um, so I think those are, and what, what I always tell people too is
52:00beyond all that, it's also FedEx is expecting you to be successful.
52:04And so if you are buying one that is extremely operationally difficult and it
52:08is your first opportunity or not buying one coming in free on something that
52:12is extremely operationally difficult.
52:14Mm-hmm.
52:14FedEx isn't gonna give you some giant grace period to figure it out.
52:18And that's a way to start off with the black mark.
52:20And maybe that's the end of your FedEx career just because you
52:23decided to do something for free.
52:25It's much easier, just like Amy said, to start with something that the, it's
52:30a great business at a fair price rather than a fair business is at a great price.
52:34Yeah.
52:34That great price often has some caveats like Amy's saying.
52:38So it's what we always encourage people to do is find one that you feel
52:41comfortable operating at a business and a part and a, and a manager and a
52:44driver staff that you feel comfortable, um, you know, meshing with and, and
52:49learning and, and, uh, taking all of that, uh, um, opportunity on.
52:54And then as you have opportunities to grow, Amy said it, and when
52:58we were in the business, we did the same thing all the time.
52:59Where we would take those, we would take these free opportunities because we knew
53:02the risks, we knew how to be successful.
53:04Mm-hmm.
53:05And we knew the costs for those businesses.
53:06So it, it is something where it is your, your next steps can be that way.
53:10It's just difficult as a, as a first step.
53:13Yep.
53:14As a first step.
53:14And it is, you know, and it is much easier to grow on the p and d side,
53:18um, and get in on the p and d side.
53:20So if you're looking to get into Linehaul and it's just a barrier that you can't
53:23break into, um, or you don't wanna, you know, they're a little bit more
53:27expensive also, uh, they're higher value.
53:30So, um, but if you don't wanna take on that bite right away, get into p and
53:34d, establish your relationships and, and invest some time, um, you know, in
53:39this new career, in this, in this new journey, and, and then get into line
53:43haul and then make those relationships and, and kind of grow from there.
53:46Yeah.
53:47Now we have a few more questions that I'm gonna get to, but I just want to
53:49make sure that if you're on here and you're trying to figure out good next
53:53steps to, to learn more, we do new investor summits throughout the year.
53:57So if you're a new buyer trying to learn, um, that's one of the best ways we have
54:01it at our offices here in Nashville.
54:03We actually have one on Friday, but it is.
54:05Completely full.
54:06We are not putting anybody else in the building.
54:08So the next one is April 16th, so if you do want to come, that's the one
54:12to sign up for because, and, and sign up quickly because like we literally
54:16are locking the doors and, and say, and we have a wait list for, um, it
54:20maybe adding people, but go to go to April 16th if you're trying to get in.
54:24And if you're a current contractor, we have different events throughout the year.
54:27We have a line hall one in our offices in Nashville on April 17th.
54:31And then we have a p and d one later this summer.
54:33I can't remember if it's June or July, but, um, really focused on
54:36the topics for those industries, the things that we're seeing.
54:39We'll bring in different speakers to talk about what we're seeing across a
54:42wide variety of things, a full day event.
54:44And then we've got a bred one later this year too.
54:46So there's different ones throughout the year that will happen.
54:49So you'll see Amy, uh, at p and d one and you'll, you'll be
54:53able to learn from all of those.
54:54But whether you're a new investor or contractor, we do have those.
54:57In-person events that are free to attend.
54:58You just have to come on out to Nashville and I promise we'll, we'll
55:01make sure you have a good time.
55:03Absolutely.
55:05Um, so a, a, a question here, Amy.
55:07Um, any tips for contract renegotiations?
55:12All of them?
55:13Yeah.
55:14Any tips in 30 seconds?
55:15I'm sure there's nothing else to talk about after that.
55:17Uh, so I always say, um, so I will, you'll hear me say this, I write all of my, um,
55:24renegotiations, um, like a business case.
55:27So, um, use spotlight.
55:28Use the data that they have given you to track, compare it with your own numbers.
55:33Don't just use theirs.
55:34Don't just use yours.
55:36Compare them together.
55:37Find the delta of kinda what's not, you know, matching or meshing.
55:42Um, and then just, you know, get your data together and
55:46then be fair in your requests.
55:48Um, you know, they're gonna listen to reason.
55:51They're not just gonna listen to, I don't make enough.
55:54I need more, right?
55:55They're going to listen to, this is changed in my network,
56:00this is changed in my operation.
56:02These are new, you know, facts and figures, and this
56:05is where I'm short or not.
56:07You know, this is what I need to continue to service the customer
56:10the way that you want them serviced.
56:12Um, you know, and, and I think that's the way to, to go about it.
56:15I always say, get buy-in from your SPS, your, um, service provider specialist,
56:20as well as your local terminal.
56:23Make sure they're on board, and then go ahead and, and put the
56:26request in for renegotiation.
56:28Um, but if you don't have your information to them in advance,
56:32um, they're not gonna read it.
56:35They're not gonna consider it.
56:36It's already that boat.
56:37The ship has kind of sailed.
56:39Not that you couldn't go back for renegotiation, but if your contract
56:42is up, you're gonna get an invite.
56:44Um, FedEx is going to send you an invite that says, Hey, we're gonna renegotiate
56:49here in six, you know, four to six months.
56:51This is the time to send us, you know, this is the deadline to send us
56:54your unique characteristics or your requests for reconsideration for us
56:58to look at the numbers, whether it's volume related or staffing related or
57:02resource related, um, or just cost of, you know, economic change in your, in
57:07your CSA, whatever that looks like.
57:09They're open to listen, uh, but you gotta bring it.
57:13Yeah.
57:13Yeah.
57:14Um, I'm gonna do a few lightning questions.
57:17Yeah.
57:19So I'll answer one of these quickly.
57:21Is there financing available in this space?
57:23Yes.
57:24Um, we do probably 70, 80% of our deals with some kind of financing, whether it's
57:30bank financing, SBA conventional seller financing, you can assume vehicle debt.
57:34There's a lot of options that we can walk you through to try to make, um,
57:37the financing side of the equation work.
57:39But we have a, a large number of banks that we work with in this space,
57:42specifically, that fund these deals all the time and know what to look for.
57:46Mm-hmm.
57:46Um.
57:48Why would owners sell if they're profitable?
57:51Amy?
57:52Oh, well, um, growth, um, freeing up some bandwidth.
57:57Um, retirement, uh, change in, you know, scenery.
58:03Um, old school.
58:04Just don't wanna, you know, don't wanna do it anymore.
58:06Doesn't mean it's bad.
58:07They're just kinda over the, the changes.
58:10They don't wanna lean into the new compliances and 2.0 and all of the things.
58:15Um, but I think there's a lot of reasons why good contractors
58:19either wanna get out completely or wanna peel off a little piece.
58:24Um, you know, there's scale, you know, in some terminals you may have grown
58:27outside of your own capacity, um, or you might wanna just, you know, you
58:31have a growth opportunity, but you're.
58:33You're kind of handcuffed and you don't wanna get too much bigger,
58:35but there's an opportunity so you can sell, free up a little bit of
58:38white space and then dive back in.
58:41Yeah.
58:42A a hundred percent agree.
58:43And, and it's, it's funny, one of the, the only things that's
58:45constant with FedEx is change.
58:47You know, we, we have these conversations all the time over the
58:50years is that, you know, for a decade where people say, why would people
58:53be selling if they're profitable?
58:54I, I think personal reasons, retirement are for sure there, but.
58:58Across the entire spectrum of time.
59:00You know, last decade or so, there's always been something that's a
59:03new change that FedEx is doing.
59:04Yeah.
59:05There's always people that don't want to change, and that's fine.
59:07Like that is, uh, you've run this business, maybe they've run this
59:10business for 20 years and you just don't, whatever the next new thing is mm-hmm.
59:13Is the last new thing that you can do, and so you decide to sell and
59:16that's, that happens all the time.
59:18Like I said, I've seen it every year since I've been here.
59:20Yep.
59:20It's been a different thing every year.
59:22And it's just, that's the nature of these businesses is that there's
59:25always a pretty similar number of these businesses that are for sale.
59:28Actually.
59:28It feels often if you're going and looking at listings that there's an infinite
59:32number, but you know, there's about 6,000 contractors and there's always a pretty
59:36similar percentage of those contractors that are selling their businesses or
59:38selling a piece of their businesses.
59:41As I always say, as soon as I feel like I am learned it all and I'm
59:45an expert, the rules change and then I gotta start all over again.
59:49Then I'm not the expert anymore.
59:52And I, I told this quick question about rural areas.
59:54So the way FedEx compensates, there's rural and there's urban, there's mixes,
59:59FedEx tries to create a contract that is profitable for any type of business.
1:00:04They, you know, they have a black box of some profit range that they want
1:00:07everyone to be at, and they try to create revenue models that get you to that in
1:00:12a fair market, sometimes they're great at it and sometimes they miss the mark.
1:00:15And that's what renegotiations are for.
1:00:17And that's what Amy was talking about, is providing the data to be able to
1:00:20say, if, if you think they've missed the mark, don't just yell, provide the
1:00:24data, and you can talk them through it.
1:00:25But whether it's rural or urban, that I don't change the valuation based
1:00:30on the composition of the territory because FedEx does try to compensate
1:00:35for whatever the market looks like.
1:00:38Yep.
1:00:39Um, let me see if there's any quick ones.
1:00:41Um, have you felt your margins change with 2.0?
1:00:46Um, increased.
1:00:48Okay.
1:00:49Yep.
1:00:50And, and typical ranges we see, we see everything from about 10 to 20%
1:00:54on average in p and d, it can be, linehaul can be 10 to up to 25 or 30%.
1:00:59The reason there's a bigger range with Linehaul is there's a lot of variance.
1:01:02It can be, yes, there can be ones that are higher than either of those.
1:01:05Mm-hmm.
1:01:06But typical ranges, linehaul has more variance because
1:01:09of the way it's structured.
1:01:10There's different types of linehaul structures.
1:01:13The way Amy does hers is very different than the way some
1:01:16line haul contractors do.
1:01:17Mm-hmm.
1:01:17That are only solos or are only teams.
1:01:20Like there's, there's very different types of line haul structures.
1:01:23We would see a wider variance.
1:01:25Um, but in, and the size of the business is different too.
1:01:27On linehaul, you might get two or three or five runs wherein p and d
1:01:31are typically running 10, 15 to 17.
1:01:34So the net is a little bit lower on p and d, but the size of the
1:01:40operation and the revenue might be a little bit bigger in totality.
1:01:43So, you know what I mean?
1:01:45There's a value.
1:01:46You can't just say, well, that's, you know, uh, 10 to
1:01:4820 and this one's 20 to 30.
1:01:50So of course I wanna go this direction.
1:01:52Um, you know, 20% of 2 million is a lot different than 10% of 20 million.
1:01:58I. A hundred percent right?
1:02:01And you can grow a lot easier in p and d, so there's reasons why you're in both.
1:02:05Um, Dave and I, you know, the diversification has allowed
1:02:08us to understand the network as well as grow in both.
1:02:12And there's seasons, there's seasons where line holes through the roof.
1:02:15There's seasons where p and d is through the roof.
1:02:17Um, and now we're going through a season where each of the contracts is changing
1:02:22and those are gonna grow individually without having to move a lot of pieces.
1:02:27Right.
1:02:27We're gonna grow into 2.0, we're gonna grow kind of wide
1:02:30and deep, if that makes sense.
1:02:32Um, so that's kind of nice, uh, that we don't have to like, you know, shift a
1:02:35lot of opportunity, um, opportunities in order to open up new opportunities.
1:02:40It's just gonna kind of come to us.
1:02:41So that's, that's nice.
1:02:42Um, though there are some, you know, new opportunities that we're even
1:02:45pursuing this late in the game, so.
1:02:49Perfect.
1:02:49Well, the, we're we're out of time here, so it was the last question.
1:02:52Amy, would you do FedEx again?
1:02:54If you could, if you could start over.
1:02:56Absolutely easy.
1:02:57Absolutely.
1:02:58We've, uh, we have, uh, uh, three awesome kids.
1:03:02Um, it's created stability.
1:03:05Um, it's Dave and I are true entrepreneurs.
1:03:07We love the change.
1:03:09Um, it's, it's not without its challenges.
1:03:11We have other businesses.
1:03:12It's no more challenging than food service or investments or real estate.
1:03:17You know, everybody's got their, every industry's got its challenges.
1:03:21Um, but we really enjoy it.
1:03:22We enjoy the people part of it.
1:03:24We enjoy the changes, the community.
1:03:27Um, and we've, we've raised a family of three.
1:03:29We have grandkids.
1:03:30Our sons are now in the industry.
1:03:33One's in line hall, one's in p and d. They're both going into management.
1:03:36So, and you hear that story quite a bit with contractors, this kind of legacy,
1:03:40um, this legacy, you know, business that you can hand down to your, to your kids.
1:03:45Um, it's not without its challenges, but I would 100% do it again.
1:03:48Perfect.
1:03:49All right.
1:03:49Well Amy, thank you so much for being here, for answering questions.
1:03:52You got it.
1:03:52And thank all of you for being here.
1:03:54Uh, this will be posted on YouTube.
1:03:56You can follow us on all the socials you posted in the chat.
1:03:59But for everyone, thank you for being here, for being live,
1:04:01and we'll see you next time.
1:04:02Awesome.
1:04:02Thanks guys.
1:04:03Thanks Josh.
1:04:04See ya.

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