The Business of Independent Service Provider Contracting

Embracing Change: How "On-Time" Service Requirements Are Evolving and Why It Matters to CSPs

Posted by Jeff Walczak on 2/4/24 2:18 PM

Groovy Wave (1)

The FedEx network, under the transformative wave of Network 2.0, is poised for significant change. This overhaul will extend its influence to all facets of FedEx and, by extension, to the lives of its customers. Amidst this transformation, there's a vital element that must remain unwavering for the successful integration of Express services into the Ground network: the FedEx Brand.

Protecting the FedEx Brand at All Costs

The FedEx Brand stands as a symbol of three core attributes:

  • Reliability: FedEx is synonymous with dependability. Customers trust FedEx to deliver their packages on time, every time.
  • Speed: In a fast-paced world, FedEx is renowned for its swift delivery services. Speed matters, and FedEx delivers on this front.
  • Efficiency: FedEx operates with remarkable efficiency, streamlining logistics to get packages from sender to recipient with minimal delays.

Customer Service: The Heart of the FXG Brand Strategy

Customer service is the driving force behind FedEx. It shapes the brand's identity, informs advertising strategies, fuels innovation, and positions the business for success in 2024 and beyond. Maintaining service consistency across all operations is paramount.

Ensuring Brand Integrity as Express Integrates with Ground

As Express services merge with Ground, and we abandon “FXG” for “FDX”,  preserving Brand Integrity becomes a top priority. FedEx has a clear plan to ensure this:

  • Monitoring Service Metrics: FDX will closely monitor all service metrics, including new criteria for Contracted Service Providers (CSPs).
  • Communicating Changes: FDX will launch extensive advertising campaigns to communicate these transformations to the public.
  • Swift Action: In cases where CSPs struggle to adapt to the evolving culture and standards, FDX will take decisive action to replace them.

Revised Service Metrics: What CSPs Need to Know

eroute P&D driver app

Service measurements will undergo a transformation and will become critical for maintaining contracts. These include:

  • Inbound Local Service (ILS): This remains largely unchanged, with contractual obligation of 98.5%. Sacrificing ILS in favor of other service standards is not an option.
  • Express Services: This encompasses First Overnight, Priority Overnight, and other high-value-added logistics services. All time-definite services will be included and you’ll need to achieve 98.5% + here to stay in the game as well.
  • Same-Day On-Call Pickups: This service will be a major focal point. Customers will expect rapid pickups, sometimes within an hour of their call. As there is today, there will be a zero tolerance policy for missing these pickups. Not only is there the challenge of servicing these stops on the same-day they are called in, but the time-definite element will challenge CSP’s ability to adapt their business culture to the difficulty and complexity of meeting this contract standard. 

The Road to Success for CSPs

FDX acknowledges that transitioning to these new standards will be challenging. However, it's essential to recognize that these changes bring forth opportunities for CSPs:

  • Operational Improvements: Embracing change will lead to operational enhancements, ensuring smoother, more efficient processes.
  • Financial Advancements: CSPs should not suffer financially as they adapt; rather, they stand to become more profitable when correctly implemented.

Seizing the Opportunity with eTruckBiz

Over the past year, our team at eTruckBiz has been hard at work, diligently preparing for these changes. We've understood the importance of staying at the forefront of this information, not just to keep up but to lead the way in assisting CSPs like you. Our team is here to provide support, guidance, and expertise whenever you need it. Your questions, concerns, and challenges are opportunities for us to assist you in finding solutions and making this transition as smooth as possible.

Topics: FedEx, FedEx Ground, Contract, Metrics, Costs, Network 2.0, fedex ground contractors, fxg, CSP, time definite

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