16 FedEx Ground P&D Routes, North Central Texas

$2.4M

Revenue

$642K

SDE

3.1x

Multiple

Subscribe Free

Read the full deal writeup

Get Free Access

Already a member? Sign in

Full Editorial Writeup

This is a package of 16 FedEx Ground Pickup and Delivery (P&D) routes operating in rural North Central Texas, running under contract to FedEx within a defined Contracted Service Area (CSA). The business delivers packages to local homes and businesses, generates roughly $2.4M in annual revenue, and throws off about $642K in owner cash flow at a 3.07x multiple. The asking price of $1,975,000 includes a fleet of 16 trucks owned free and clear, plus roughly $698K in inventory/asset value.

What makes this listing notable to a hands-off buyer is the operating structure: a full-time manager already runs daily operations across 21 full-time employees, making this closer to a managed asset than an owner-operator grind. The rural territory profile is a quiet advantage, with longer but simpler routes that tend to carry lower driver turnover than dense urban zones. There are no franchise royalties, marketing costs, or real estate obligations to carry, which keeps the operating model lean.

The core economics ride on FedEx Ground volume, which is tied to e-commerce penetration that has roughly doubled over the last five years to near 30% of retail. P&D contractor businesses are genuinely recession-resistant because people and businesses keep receiving packages in any economy. The catch, and the thing every buyer of this model must underwrite, is that the entire revenue base sits inside contracts with a single counterparty, FedEx, who controls rates, route geography, and contract renewal terms.

Why we like it

Earnings quality is strong on paper, with $642K of cash flow on $2.4M of revenue, a 27% margin that is healthy for a route-based logistics business. The 3.07x multiple on cash flow is in the reasonable range for FedEx Ground route packages, and the fleet transfers free and clear with no vehicle debt to service. That means day-one cash flow is not getting eaten by financing on the trucks.
The moat here is the FedEx contract itself: a defined CSA gives you an effectively exclusive territory that competitors cannot simply enter. Rural geography adds a second layer of durability, since longer routes and lower driver turnover reduce the single biggest operational headache in this business. You are buying a protected lane of package volume, not fighting for customers daily.
Market tailwinds are real and structural. E-commerce has roughly doubled to near 30% of retail in five years and is still climbing, which directly expands the package volume flowing through P&D operations. Last-mile delivery is one of the few logistics niches that grows almost regardless of the broader economy.
The operator advantage is that this is already manager-run with a full-time manager and 21 employees in place. A capital-first buyer can own this closer to passively or roll it into a larger multi-CSA route portfolio without personally driving a truck. The infrastructure to scale by acquiring adjacent routes is already proven here.

How to improve it

Audit route-level profitability within the first 90 days to find which of the 16 routes are drag and which overperform. Rural routes can hide inefficiency in miles-per-stop, and resequencing or consolidating underperforming routes can lift margin without adding trucks. This is the fastest lever before any capital is spent.
Lock in and extend the key personnel, starting with the full-time manager who is effectively the business. Put a retention agreement and incentive comp in place before closing so the operating knowledge does not walk out the door post-sale. In a manager-run model, the manager is the asset you are actually buying.
Build a tight driver recruiting and retention pipeline even though turnover is already below average. Driver scarcity is the number one constraint to route profitability, so pre-sourced backup drivers and referral bonuses protect against service failures that can trigger FedEx penalties. Keeping trucks staffed protects the contract.
Model the next FedEx contract renewal and rate adjustment carefully, then plan fleet maintenance capex against it. With trucks owned free and clear, you want a replacement schedule so a wave of aging vehicles does not hit cash flow all at once. Spread capex and negotiate volume on parts and fuel.
Pursue adjacent CSA acquisitions to build scale and spread the fixed cost of management across more routes. The same manager and back office can often absorb additional territory, improving margin as you grow. A multi-CSA roll-up is the clearest path to multiple expansion on exit.
Tighten fuel and maintenance cost controls with telematics and GPS tracking across the fleet. Even a few points of fuel efficiency and reduced idle time flow straight to the bottom line on a 16-truck operation. These are boring, repeatable savings that compound monthly.

Diligence notes

Verify the FedEx Ground contract terms, remaining duration, CSA boundaries, and rate structure in detail, because the entire business sits on a single counterparty relationship. Confirm the contract is transferable and that FedEx will approve the new buyer, since FedEx must bless any ownership change. This is the single largest risk in the deal.
Confirm the $642K cash flow figure with tax returns and settlement statements from FedEx, and clarify whether it is before or after the full-time manager's compensation. If the stated cash flow does not fully load manager pay, benefits, and backup driver costs, the real owner earnings are lower. Reconcile the add-backs line by line.
Inspect the fleet condition, age, and mileage of all 16 trucks, since they are included free and clear but will drive future capex. A seemingly debt-free fleet nearing replacement age is a hidden liability. Get maintenance records and project the next 24 to 36 months of vehicle spend.
Clarify what the $698K of inventory actually represents, as inventory is unusual for a delivery route business and may in fact be fleet or parts value being labeled broadly. Understand exactly what tangible assets back the asking price versus intangible contract goodwill. This affects both negotiation and financing.
Review FedEx service scorecards, penalty history, and any prior contract disputes or warnings. A history of missed service standards can threaten contract renewal and signals operational fragility. Ask for the full performance record over at least the last two years.
Note the listing states this is not SBA eligible, which changes the financing picture materially. Confirm available financing paths, including seller financing or route-specific lenders, and how that affects your required equity check and returns. Understand why it fails SBA eligibility before committing.

Source

Originally listed on BizBuySell. View original listing →