The Business of Independent Service Provider Contracting

Image by Xos Trucks

This blog post is written by our friends at Xos Trucks.

The passenger transportation sector has seen a significant uptick in Electric Vehicle (EV) adoption over the last several years, yet the commercial side has been slower to follow.

Now, that’s changing. Increasing environmental regulations and a growing interest in reducing costs have begun to tip the scales toward more widespread fleet electrification.

As a fleet owner and operator, you might be asking yourself, “When, how, and why should I consider electric trucks for my business?” Unfortunately, there’s no simple, one-size-fits-all answer to “how” you should go about transitioning to electric, but “when” and “why” you should go electric can be more easily summarized.

Going electric can positively impact the efficiency and profitability of your business. Here’s a summary of the main reasons why you should consider electrifying your fleet.

Image by Fokusiert

Have you read Stephen Covey’s book titled 7 Habits of Highly Successful People? If so, have you thought about applying it to being a Contract Service Provider (CSP)?

We’re adapting the most relevant of his seven habits into best practices of highly successful CSP’s.

Covey’s first habit is Be ProactiveⓇ Focus and act on what you can control and influence, instead of what you can’t. This habit is especially important and a great starting point.

In this uncertain time, it seems like there was one thing that was certain.

It appeared that stops and volume were marching forward, with no regard for the turbulence and difficulty that we were told surrounds us. 

In a roughly 2+ year environment of growth, the rising revenue tide hid many tree stumps, and kept the good ship Contracted Service Provider sailing happily into the sunset.

All was well.

Until it wasn’t.

Recently, the volume has leveled off and in many cases, retreated.

This dip is not too much different from a “normal” summer, but this time, it hurts...bad. 

Let’s look at why.

This blog post is written by eTruckBiz Business Coach, Bob Tiell.

You've heard people say, "There's strength in numbers." And I'm sure you've heard, "Two heads are better than one." People say them because they're true.

Both can be said about entrepreneurship. There are lots of moving parts in a business which leads to some things getting overlooked and others missed altogether. So, business owners may benefit by asking an expert to see what can make their company stronger down the road.

I can be that other set of eyes. I am someone who’s learned what success looks like by working alongside hundreds of AO’s and BC’s throughout the United States. I’ve gained perspective on how business owners achieve their goals.

My “second career” as a Business Coach (after departing the management ranks at FedEx Ground) affords me opportunities to alternately learn from and guide the brightest Contractors in the business. Today, I’m sharing a few of the best tips that can strengthen your company for the long haul.

(Courtesy of ...)

Hutch Motors, Inc. is an eTruckBiz customer that was recently recognized as a Regional Entrepreneur of the Year by FedEx Ground (FXG). The award recognizes service provider businesses that have excelled in service and safety - both of which are keys to success.

In addition to those two criteria, FXG considers business growth, customer satisfaction, ethics and community involvement as award components. Winners are selected from six regions in the United States plus one in Canada.

We caught up with Eric Hutchcraft, the Authorized Officer (AO) of Hutch Motors, Inc. asking him about keys to success. 

(Courtesy of Ron Levine)

The first Unboxed event in Ft. Lauderdale, Florida, was our last pre-COVID event. For that reason, the two-day seminar held in February will always stick in my memory. The pandemic had not yet reached the United States. Socializing in-person was normal.

The poolside cocktail party stands out because it was a perfect sunset over the harbor, and I had the pleasure of meeting many successful Contractors there. One of the best aspects of my job is people sharing their stories of becoming FedEx Ground Contractors and what it means to them today.

In particular, Ron Levine and his son, Scott, entered into the transportation business unconventionally. Neither worked as a driver, nor a package handler, and they did not know anyone already in the business.

(Stock Image from Canva)

Experts are predicting fuel prices will continue to increase in 2021. Why is that the general consensus?

First, we have to look at the main components of fuel pricing. The underlying components are a.) the cost of crude oil, b.) refining costs, and c.) distribution and marketing costs. Seems simple enough, but then federal, state and local taxes are added. That’s why pricing generally differs from one state to another.

(Jeff Thompson, Courtesy of Jeff Thompson)

Thursday and Friday of last week I watched Gary, my co-worker, leading our Engineering & Operations training class. He’s a former FedEx leader with decades of operations experience. His expertise is unmatched.

Most of the students last week were BC’s. They paid close attention. That’s impressive because earlier in the week they attended the Leadership & Management class, too. BC’s are accustomed to spending most days on their feet. Sitting in a classroom all week is rare for them, but so important.

The attendees, alongside several AO’s and new owners, were truly interested in changing the trajectory of their businesses. Change is not for the weak, nor for those who cannot handle uncertainty.

The week begins by asking attendees to write down the most important questions they want answered. Some of last week’s replies were predictable, and others not so much.

(Jeff Thompson, Courtesy of Jeff Thompson)

What do people do with the money they make from being in business? Let's dive into that question.

Businesses usually exist for reasons other than just making money. Making money is a necessity to keep the business going, but there is probably another reason "why" a business exists.

I encountered one of the most clearly defined reasons "why" a business exists in my recent conversation with Jeff Thompson of CI Express from Kennewick, Washington. Jeff is the subject of our most recent Success Story, and the interview on our website is worth a read. You may even be inspired.

(Dawn Nyen, Courtesy of Dawn Nyen)

A co-worker recently suggested that I reach out to a customer who has an interesting history with entrepreneurship.

My conversation with Dawn Nyen developed into our most recent Success Story.  And just in case you don’t venture over to that page on our website, I’ll share one of her lessons learned in this blog post, but trust me the interview is worth the few minutes it takes to read.

Dawn’s path to becoming a FedEx Ground Contractor started in a hotel ballroom. She answered a local newspaper ad instructing people to attend a local recruiting meeting about owning a business. Dawn and her sister were the “last ones standing” in the room. Then, her sister dropped out leaving Dawn standing all alone.

Okay, we know what many folks are going to say. The DRO is troublesome and may not work.

While it is true that learning to use it effectively is difficult, it actually works fine. It’s the theory and engineering principals behind it that are difficult to maneuver and grasp.

The move from static route creation and management to that of a very dynamic (always changing) way of route management is now at hand. Thanks to the virus, the premature push to unprecedented levels of eCommerce, and the need for 7 day service, all are being forced to transform quicker than originally planned.

The time to embrace Dynamic Route Optimization is at hand. The fundamental culture change to Dynamic vs. Static planning is now underway.

Do you feel like you’re in a thankless job? If so, you’re not alone. Most FedEx Ground CSP’s can provide daily evidence to support that conclusion. You work daily ensuring that packages are delivered (and picked up) safely to and from the correct addresses. Many times, you do this based on information that leaves something to be desired.

That’s why last week’s ceremony in front of the White House was so extraordinary. The President of the United States spent a few minutes recognizing truckers including a FedEx Ground Contractor.

Here's a quote that correctly sums up today's blog post , "The past is in your head. The future is in your hands."

You'll recall that our last blog post dealt with the fact that today's FXG Contracting environment is very different than it was several years ago. More specifically we said what is being done has not changed as much as how it's being done differently.

What was once “wild speculation” has now obviously become reality. As most of you know, we were among the first and few trumpeting the change of your business from lifestyle to transportation company. Now that the transformation is at least halfway complete, it should now be obvious that “what worked in the past won’t work in the future”.

HOW A COMMUNITY COLLEGE DROPOUT FOUND ENTREPRENEURIAL SUCCESS

You think your market conditions are tough, what about Colorado? According to the latest Bureau of Labor Statistics (BLS) data, the Denver area's average weekly wages are $1,242. Think it's easy to find drivers? The BLS also lists the area unemployment rate at 2.4%. Way lower than the U.S. average.

What made a young guy from out of town who knew nothing about the logistics industry think that he could buy a Ground business to support his growing family? Sure he's smart, but he's so young.

"There's no selling, no advertising, no collecting money from past due accounts. I'm not saying it's easy, but it beats a lot of other options out there," Preston Wengert says.