Hows the the new FedEx CC FSC program working for

terryandrene

Veteran Expediter
Safety & Compliance
US Coast Guard
RE: Hows the the new FedEx CC FSC program working

Dave, I never said it was better; I've said that I believe it is fair for the customers and for the drivers. I've provided my opinion as to how this FSC computation works, in a couple of threads now, and can think of no other way to explain the simplicity of it all. If you really think the company has a $14.6 million FSC slush fund for themselves, perhaps you could find out what they are doing with all that loot and share the info with the rest of us.
 
G

guest

Guest
RE: Hows the the new FedEx CC FSC program working

I said that is what would go into that fund during a one year time frame if they made $75.00 off of each load. No matter how any of us look at it, it's still alot of money being taken away from the folks doing the job and paying for the fuel. sorry if you thought i was being rude.

Drive Safe
David Mayfield
O/O since 1/27/95
 

mcbride

Veteran Expediter
Charter Member
RE: Hows the the new FedEx CC FSC program working

I've said that I believe it is fair for the customers...

------------------------

Terry,

I don't understand this. If company A pays $300 FCS for 1000 mile run and Company B pays $100 FCS for the same run and miles...how is this fairer to the customers? Company B in theory is now paying part of company A's freight charges. Am I seeing this right?

-mcbride-
--What goes around comes around--
 

ATeam

Senior Member
Retired Expediter
RE: Hows the the new FedEx CC FSC program working

>I would like to see other things happen;
<snip>
>AND access to the fuel isles at the express and ground
>centers so we can pay for fuel up front at $1.25/gallon

I would not like to see such access or such a fuel arrangement. I prefer the convenience of buying fuel at truck stops. I hate to think of being low on fuel and tight on time on a run, and then having to find a FedEx facility to fuel up. What about showers? What about food? What about all the other services truck stops provide that we would miss if FedEx became our fuel source? No thank you. I'd much prefer that they use money to bring my fuel costs to $1.25 than force me to drive to their terminals to buy it at that price.
 

greg334

Veteran Expediter
RE: Hows the the new FedEx CC FSC program working

Phil,
You missed the point - I said access not, exclusive use of.
 

davekc

Senior Moderator
Staff member
Fleet Owner
RE: Hows the the new FedEx CC FSC program working

On McBrides post, I believe that was how Fedex kind of described it in their press release without the numbers.


With several posts about their rates or load offers being lowered, I believe they are using the balance (or overage) on FSC's to compete.
When their rate is lowered, or your getting offers under say 1.20,
they (Fedex) are losing a percentage as well. My quess is they are using that difference to maintain steady profit levels.
Could be numerous reasons for them to do that.
If not, they would have let you keep your old contract.
Turtle's post actually has some merit behind many of his points when compared to his Conway days.








Davekc
owner
22 years
PantherII
EO moderator
 

mcbride

Veteran Expediter
Charter Member
RE: Hows the the new FedEx CC FSC program working

Con-Way paid a flat rate per mile...how does that compare with FedExCC not paying a flat rate per mile but paying a flat rate for FSC?

With Con-Way we were paid the flat rate fuel charge and $1.21 per mile...so who the customer was, was of no matter to us. I think they did this so the cheaper contract freight would get covered. (I believe that the contractors were turning down GM and the like freight because of the poor fuel charge.) With the flat rates people were more inclined to carry the freight. However, we did make less with this system than we did prior the implemention of the program.

We have not been with FedExCC long enough to compare any figures with respect to before and after this new system as we were only with them about a month before it was implemented.

I still wonder about company A finding out company B's freight charges are being subsidized by their charges? What stops company A from using a carrier that pays all of the fuel charge they have paid to the drivers and not into a so-called slush fund for other companies?

-mcbride-
--What goes around comes around--
 
G

guest

Guest
RE: Hows the the new FedEx CC FSC program working

psssssssssssssssssssssssssssssssssssssssssssssssst
i got the keys and combo to the safe where they hide the slush fund from the owners
 

kjack4181

Seasoned Expediter
RE: Hows the the new FedEx CC FSC program working

kjackI was with fedex for over 18 years(back to the old Roberts days)When I left it was because of simple math.I had 7 trucks leased on,1 ER unit and 6 Dr units.I added up the total fuel surcharge for all 7 trucks for the peroid of 01/01/2006 to 08/28/2006.Then I went to the extra net and added the total miles for all of the trucks for the same peroid.Then I multiplied the miles by .2274 which was what we would have been paid for all miles at the time of the change over. The result was an average loss of $1410.00 per month per truck.Now the simple math. 1410.00 x 7 x 12.= $118440.00. That is straight off of the bottom line.I know it is gathering information from the past to predict the future.I would like to ask a question. Has your acceptance rate gone up or down since 09/18/2006. If it has gone down: why?
 

Coco

Seasoned Expediter
RE: Hows the the new FedEx CC FSC program working

>I just wish they'd present it honestly to the contractos when they make the change, instead of painting a pretty picture with it. <



Amen!
 

ATeam

Senior Member
Retired Expediter
RE: Hows the the new FedEx CC FSC program working

I would like to ask a question. Has your acceptance
>rate gone up or down since 09/18/2006. If it has gone down:
>why?

Our new truck has been in service since June 15, 2006.

From 6/15/06 to 8/17/06, our acceptance rate was 71.43%.
From 8/19/06 to 10/26/06, our acceptance rate was 88.24%.

I will offer no opinions based on these numbers. As I have said in other posts, it is too early to draw any conclusions about the new FedEx compensation schedule.

I will say that for Diane and me, one-truck owner-operators, nothing has risen out of the new schedule that gives reason to seriously consider a carrier change.
 

mrgoodtude

Not a Member
RE: Hows the the new FedEx CC FSC program working

Prior to the contract change, Mike and I were finally up to a "respectable" 65% acceptance rate (we were at 29% at one time). After the change, we have probably one of the lowest acceptance rates in FECC. I can honestly say that the loads we have been offered have been ridiculously low, even for a reefer and TVAL truck. While we understand that the cost of fuel has dropped, it hasn't dropped enough for a load offer to drop from $1.80 to $1.30 per mile.

I do want to ask Phil a question about his acceptance rating though. Phil, is your acceptance rating much higher because you are now owners of a truck and have to make sure that truck payment is covered? I'm sure that the owner of the truck you were driving for had a threshold amount for the acceptance of a load as he had to cover the costs of the truck and pay his percentage to you.


Mike and Cyn
 

kjack4181

Seasoned Expediter
RE: Hows the the new FedEx CC FSC program working

Having been involved with Phil and Diane in a business relationship for several months I can honestly say that their acceptance rate was consistantly higher than the rest of my fleet. However, their low ball offers were also lower than the rest of my fleet and this was prior to 09/18/2006.The type and quality of the run offers may have had something to do with their customer service which was always excellent
 

ATeam

Senior Member
Retired Expediter
RE: Hows the the new FedEx CC FSC program working

>I do want to ask Phil a question about his acceptance rating
>though. Phil, is your acceptance rating much higher because
>you are now owners of a truck and have to make sure that
>truck payment is covered?

No. Purchasing our new truck has not put us under financial stress that would motivate us to accept loads we otherwise would have not.

Four truck payments have come due since we bought our truck. We have made eight and have also made good progress in replacing the down payment money that came from savings.

>I'm sure that the owner of the
>truck you were driving for had a threshold amount for the
>acceptance of a load as he had to cover the costs of the
>truck and pay his percentage to you.

No fleet owner we ever drove for had a threshold amount for load acceptance. They all left that to our discretion.
 

ATeam

Senior Member
Retired Expediter
RE: Hows the the new FedEx CC FSC program working

About our acceptance rate, allow me to add that the rate fluctuates over shorter time periods. Over a year, we come in at about 80% acceptance and 90% in service. The 88% figure mentioned above is above average for us. There are no conclusions to be drawn from this number beyond it is what it is. As I have said before, it is too early in the new pay schedule to draw any firm conclusions about it.
 

Turtle

Administrator
Staff member
Retired Expediter
RE: Hows the the new FedEx CC FSC program working

Hiya, Cheri

> Turtle, I have no doubt that what you say is accurate, but
>there comes a time when the trickle down effect of passing
>along "the costs of doing business" combined with the lower
>revenue to an individual contractor becomes the point of
>bankruptcy for the contractor.

That's very true. They key is finding the right balance. Operating costs for all phases of the trucking industry are always on the rise. And by that I mean, in part, the costs of paying dispatchers, insurance costs, administrative costs. Carriers have to find a way to cut their costs and increase their revenue, and they'll do it any way they can provided the long term goal coincides with remaining in business.

What they should be doing is passing along these increased costs to their customers in the form of increased rates. But, Company B, C, D and all of the others will come in and undercut Company A's rates, resulting in Company A eventually going out of business. So, Company A looks for other ways to increase their bottom line.

One way is to cut the costs of paying their contractors. Contractos may either accept this "cost of doing business" or not. The ones who choose not to will go elsewhere, and as long as there are other contractors willing to come in and take on the lower rates, and enough of the current contractors choose to accept the lower rates, then Company A is doing just fine.

Some contractors will go bankrupt, because they are not prepared to handle the fiscal changes. But as long as there are as many or more contractors who can handle it than there are moving away from the company, then from the company's perspective, things are fine.

It becomes a problem when the company can no longer recruit or retain enough contractors to meet or exceed their financial goals. When that happens, the financial goals must be amended and the contractors will have to be paid more in order to maintain the needed fleet size. Companies wil do that by shaving their own bottom line, cutting even more costs, and by passing some of the costs onto customers in such a manner that it has as little impact as possible.

(Shaving and cutting their own bottoms. Now there'a a mental picture :D)

>As you say, the company will
>remain solvent, and new contractors will take the place of
>those who leave, but isn't there an inherent wrong in such a
>business ethic?

Yes, and no. It depends on what your business goals are. If you're in business to provide and care for your contractors, then yeah, there's something inherently wrong with high contractor turnover and in passing these costs along to them. If you are in the business of making money, then no, there's really nothing inherently wrong in that. Businesses who pay their employees the Minimum Wage do so only because they are required to by law. If they weren't required to, then they would be paying less. They would be paying just enough. Just enough to keep them in business and earning as much profit as possible.

>Has business become the American royalty, with a "let them eat cake" attitude?

Well, yeah. Well, no. I mean, well, duh!,
it hasn't become that, it's always been that.

Ever asked for more DH or a higher rate for a certain load? That's looking out for #1, and the rest of them can eat cake. It's the same thing. :)
 

davekc

Senior Moderator
Staff member
Fleet Owner
RE: Hows the the new FedEx CC FSC program working

As I have said before, it is too early in the new pay schedule to draw any firm conclusions about it.
======================================
If your former owner is losing a average of 1410 per month, per truck, it looks like he made a pretty firm conclusion.
That is a truck payment for many. Across seven trucks as he articulates, that would be a concern.
Waiting months and losing roughly ($10,000 per month) to figure it out looks to be extremely costly.









Davekc
owner
22 years
PantherII
EO moderator
 

mystictrans

Expert Expediter
RE: Hows the the new FedEx CC FSC program working

Okay gang it has been over a month under the new program.Heres hoe it breaks down for us: Pulling a lot of the same loads under the new surcharge it has cost us close to 2,950.00, looking at it under the flate rate it would have been more. We have also noticed that while the tarif has gone up on shorter loads, is has gone down on longer ones! A regular load that we always take went from 7650.00 down to 5,789.00 yes some of it was less feul surcharge(about 700.00) but the rate was off of the tarif. I was told by fedexcc that a lot of rate were changing...
I hope for everyones sake it is just affecting us but I here from other ER units like us it is hitting them too.
 

Bruno

Veteran Expediter
Fleet Owner
US Marines
RE: Hows the the new FedEx CC FSC program working

Sounds like a lot Driver's an owners are not happy with the program Fedex has put out. Are they working with everyone on this problem?
 

cowboyz

Expert Expediter
RE: Hows the the new FedEx CC FSC program working

Thats a good question, Has anyone else heard anything from FEDEX about the concerns? I haven't. To see the amount of dollars a contractor would lose on a DR & CR unit, This will be hard to stay in busniess(For me anyway)with just buying a DR unit. This is sort of what I was talking about in my earlier post(Post # 5 I think)If this goes on for one year where will alot of contractors be? I thought it was fear I had come in contact with, But seems to me its reality. I don't claim to be the builders of the Titanic, I know im sinkable. So the big question is how far do you let the ship go down before you jump? Or is this all just my imagination. Now don't anyone think im trying to stir the FEDEX pot again, I for one wish it had stayed like it was. Just seemed to be working fine or so I thought. I belive I read in one of the earlier post something about a smoke screen. Kind of looks like it , But I can't help but wonder why.









When I Think I've Got It Bad
Someone Comes Along With It A Little Worse!
 
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