The Business of Independent Service Provider Contracting

Should I Stay Or Should I Go?

Posted by Jeff Walczak on 12/30/16 3:51 PM

Here we are at the end of another year.

As always, it's time to look back on what we've accomplished, what we didn't, and where we want to go in the new year.Stay_or_go.jpeg

This year, however, there is a new sense of urgency involved with these thoughts.

It's time to make a decision.

It's not the usual goal setting session that we often have with ourselves each year.

This year, there truly is a reason to ask yourself, if you are in the right place or not.

Many of you are coming to grips with the realization that your business is changing.

In a very big way.

Should you stay or should you go?

It's REALLY time to ask yourself, if you and your business philosophy fit into FXG's plans!

First, let's take a look back on your business this year.

Are you happy with your results?

If you are, you can stop reading right now.

For the other 97% of you, keep reading.

The Root Cause Of My Results

You know that there is a way to achieve better results. But, in order to do so, you are going to have to start thinking differently.Stress Free.jpeg

The future of your business rests on how you think about your operation.

In fact, to survive in the ISP world to come, it's going to take the different mindset than you are used to.

The new mindset starts with the realization that the way you conducted business in the past, is not the way to continue forward, if you want to be profitable and fit into FXG's future plans.

Past Performance Predicts Future Behavior

If you choose to do the same thing you did this year, and are expecting a different results, please see: "Are FedEx Ground Contractors Insane?".patterns_of_behavior.jpeg

"If you do what you've always done, you'll always get what you've always got".

So, in order to effect change, you'll HAVE TO be willing to adopt a new approach to how you think about your business.

If you're not willing to change your culture, and the way you think about your business, you may want to quit reading now.

Which Business Objective Is Most Important

For the 50% of you that are willing to change, and are continuing to read, let's now understand several things:

You're going to have to stop thinking of your business as a giant logistical puzzle.

Your mission is NOT solely just to figure out how to get the packages delivered everyBusiness_Objective.jpeg day. Your mission is to provide transportation services at a profit. This sounds so simple, but you must really think about it.

Safety comes first, but after that, you must decide that you are going to become a cold-blooded route engineer and efficiency expert. Not an excursion planner.

You are going to think about profitability as you consider every decision you make.

It's not about the size of the packages, the driveways you can't get down, the pickup times, people calling in sick, or any of the logistical problems you face. It's about putting productivity (which equates to profitability) ahead of the logistical problems that need to be solved. In other words, after safety, profitability should be your next thought, not just how to get the packages out the door.

What About Service?

Service.jpegSo I hear you thinking: "That's great, but what about service"?

Well, service is something you need to profitably be able to provide. You can not afford to provide service at the expense of profitability.

Providing service at the expense of profitability is what your parent company has drilled into your head, because you providing service doesn't come at the expense of their profitability.

See how that works?

You must figure out and engineer how you are going to profitably provide an acceptable level of service.

Yes, it is easier said than done.

The Logistical Puzzle

You can't just solve the daily logistical puzzle the easiest way you know how. There is no question that you are definitely an expert at this. But, the question is, does Puzzel_Solving.jpegsolving the puzzle the easiest way possible, result in maximized profitability?

Most of you are already doing business this way.

You solve the daily puzzle, the easiest way you know how, then go on to the next day.

This results in most of you not being at the profitability levels your parent company expects. Just making sure the job gets done every day, which is the goal of most ISP operations, results in poor profitability. Then, you blame FXG for your less than desirable results.

So What's The Solution?

You must seek out inefficiency and kill it at every turn.

Finding inefficiency is not something you currently do on a daily basis. It is not something that FXG has emphasized...because they don't have to.

WHats_the_solution.jpegIn addition, they can't. Showing you how to be productive, efficient and profitable has resulted in hundreds of millions of dollars of lawsuits over the past 25 years. They can't dictate the manner, method or means of how you operate your business.

Being productive is hard. Making your employees productive is difficult. It takes experience, engineering, monitoring and understanding key operational metrics.

Most of all, it means holding everyone in your operation accountable for doing so.

You must have the will to do these things. If you're not imposing your will to make these things happen, and let's be honest that most of us still reading don't, then you are leaving significant amounts of money on the table.

Hey, let's be even more brutally honest, most of us have no idea how.

An easy to understand example of this is: adding an extra driver and truck into an operation in order to handle a surge of volume.

That's the easy thing to do.

The way this should be handled is to figure out a way for your operation to be adjusted in order to absorb the volume surge, without adding an extra driver and truck until absolutely, positively necessary.

There is a way to know when it is absolutely, positively necessary to do this, but it's done with numbers, not with feelings.

Oh Yeah, How?

How, you ask?Consider_a_sale.jpg

The good news is your major competitor(s) has spent 150+ years perfecting how.

You just have to want to adjust your thinking, and then your processes, to emulate theirs.

We know how they, and other successful transportation companies do it. We can teach it to you through our new Pro Business Support Package. We'll teach you how to execute cold-blooded engineering and efficiency, among other things.

So What's The Big Decision Facing Me Right Now?

Are you the type of leader and business owner FXG wants you to become?

Your parent company is seeking like minded (very efficient, productive and profitable) "vendors", that they can rely on to propel the business for the next 25 Big_decision.jpegyears. They are no longer interested in "baby-sitting" smaller, mom-and-pop type operations.

If you are not willing to grow, and become what they are looking for, then it's decision time.

Are you willing to change?

Now, this news isn't all bad. If you align your business goals and thinking along with those of your major business partner, your business is poised to grow beyond what you currently think possible.

You will be rewarded with a very profitable, very valuable business.

So What Do I Do Next?

And now, for the 35% of you that are still reading, you need to ask yourself: "Am I willing to learn a new way of thinking and running my business so I can realize the 17-33% estimate net income results that FedEx Ground expects you to realize?"

Or, is it time to take the steps necessary to plan an exit strategy? The decision is yours.

We can help you with either choice.

If you're "in", visit this page.

If you're unsure or think you want out, call us at 855-873-8585, and we can help you through that too.

Or, if you have questions like everyone else, leave them in the comments below.

 Request A Demo Now






Topics: Business Structure, Business Results, FedEx, Business Metrics, Business, Investment, model, Metrics, Selling, contractor, Profit, vendor

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