Spencer Patton’s routes span 10 states, with the owner-operator also saying he will remove himself by the end of the year from the roster of owner-operators that make themselves available to serve abandoned or underserved areas.
“I financially am unable to continue operations beyond Nov. 25 of 2022,” Patton, who says FedEx denied his requests earlier this year to renegotiate his contracts, said during this past weekend’s Contractor Expo. “This business model is hurting to a degree, where my company individually has to see change from FedEx Ground.”
Patton’s keynote address Saturday evening came during the two-day Contractor Expo held in Las Vegas, which drew some 3,500 FedEx contractors, analysts, media and others. Another 2,500 tuned in over livestream to hear the keynote.
Patton, who is also founder and president of FedEx consulting and brokerage firm Route Consultant, earlier this month announced the formation of the Trade Association for Logistics Professionals (TALP), which he said would serve as an advocacy group for FedEx Ground’s 6,000 contractors, along with other small business contract logistics workers.
FedEx told Sourcing Journal Tuesday it has negotiated or renegotiated more than 1,600 contracts in the past three months.
A spokesperson for the company told Sourcing Journal earlier this month, when the formation of TALP was announced, the company is “committed to engaging in a productive dialogue with each business to understand and address any challenges they may be facing.”
Patton outlined in his keynote three of the changes he wants to see from FedEx, including scrapping Sunday deliveries that he said results in money lost for drivers and the company.
“We are all bleeding on Sunday. Sundays are crippling this company,” Patton said during his keynote. “There’s a reason why UPS outsources all of their Sunday deliveries to the Postal Service. They’re letting the taxpayer subsidize what is almost always a money-losing effort to deliver on Sundays.”
FedEx said in its Tuesday statement it has taken steps to cut back Sunday offerings in markets with low demand and is looking at ways to create efficiencies in other markets where the service remains.
Patton also called out the company for contractual changes he said do not take into account contractors or their businesses.
His third call to action is improved training for terminal and corporate staff that he argued would ultimately enhance communication with contractors. Patton accused staff at the terminals of being out of touch in understanding driver’s concerns and priorities, along with acting inconsistently in enforcing rules.
“I really want to see FedEx Ground restore balance to the education of their staff,” he said. “Their staff have lost their way and understanding what it means to be an entrepreneur, what it means to meet a payroll each and every week. I want to see FedEx Ground offer some type of educational platform to educate their staff and be able to restore the communication lines between FedEx corporate and the local terminals because it has never been more broken.”
FedEx Ground is part of FedEx Corp. and generated $33.2 billion, or 35 percent of companywide revenue, for the fiscal year ended May 31. Ground is the company’s second largest division by revenue after FedEx Express, which had $45.8 billion in revenue for fiscal year 2022.