FedEx Routes: Seller FAQs

Category: Best Practices

If you’re ready to sell your FedEx route, you might be unsure where to begin. You may also have several questions about the transition process and what is expected from your end.

To get you off on the right foot, we’ve answered the most common seller FAQs below. We also invite you to browse the KR Capital blog, where you’ll find valuable content regarding the route sale process.

  1. How do you sell a FedEx route?

Selling a FedEx route is a multi-step process.

The first step is to contact KR Capital. We’ll gather a variety of documents and background information on your business in order to establish a market valuation for routes. From there, we will create a comprehensive route package.

The next step is to sign an engagement agreement with KR Capital, which allows us to formally list your routes for sale. We will then solicit potential buyers, who will eventually review the information on your route business following a client-approved confidentiality agreement.

As the process continues, sellers will be asked to:

    • Answer questions from potential buyers
    • Select the buyer with the most attractive offer
    • Supply the buyer with requested due diligence materials
    • Sign a purchase agreement
    • Close the sale upon FedEx approval

For a more in-depth review of the FedEx selling process, visit our blog post on the topic.

  1. How is a route valued?

The value of your route depends on a number of factors and is heavily influenced by the type of routes you own (P&D or linehaul). In general, FedEx P&D routes sell for 3 to 3.5 times their free cash flow. Linehaul runs will typically sell for 4+ times their free cash flow.

With that said, the exact price will depend on several factors. These may include location, strength of management, quality of fleet, cleanliness of financials, etc. Contact us today for a more detailed valuation of your FedEx business.

  1. How long does it take to sell a FedEx route?

The average sale time of a FedEx route is three to six months (including FedEx approval time). You can help expedite this timeline by ensuring your financials and supporting documentation are in order.

If you are planning a major life change, such as a relocation, try to begin the selling process earlier rather than later. This will ensure your future plans are not delayed by the FedEx sale process.

  1. What are the reasons FedEx sales do not close?

As with all major transactions, there are numerous reasons why FedEx route sales fail to close. The most common explanations include:

    • Seller or buyer changes their mind
    • Seller and buyer are unable to agree upon terms
    • Buyer is unable to obtain lending or FedEx approval
    • Seller documentation does not survive due diligence

The last two reasons are more likely to occur if you do not work with a FedEx broker.

  1. What happens after you sell a FedEx route?

After the sale has officially closed, the seller is typically expected to consult with and train the new buyer for two to four weeks. This initial training/transition period is typically offered to the new buyer at no cost and is part of the purchase price paid. Buyers wishing to retain sellers thereafter typically do so at a negotiated rate.

During the post-sale transition, you will be able to train the new owner as they learn the ropes of your business. They can also ask you questions as they perform each task. By implementing a post-sale transition after you sell a FedEx route, you can step away knowing that the route is in good hands.

Sell Your FedEx Route with KR Capital

If you’ve decided it’s time to take the next step toward selling your FedEx business, we invite you to work with us. Not only can we help you find qualified buyers, but we can ensure your route sells for the most value.

To get started, contact KR Capital at (503) 664-0753 or complete our online form.