Parcel Carriers

...your depot with one local parcel it's not financially viable. I am told that some RF have now dropped this idea but it does then lead to inconsistency throughout the network.

My second worry was the delivery of my parcels. The parcel industry would be an easy business if we didn't have to deliver parcels but unfortunately we do so what would happen if a parcel had to be delivered in the sticks taking the driver 20 minutes to do. With ...
...a huge amount for the parcel industry. Unfortuately as an courier driver I would be responsible for paying half the excess which is £100.00 split between myself and the RF. I struggle to see how when I'm receiving substantially less that 50% to collect the parcel I should be liable for that when things go wrong. This would also wipe out a substantial amount of profit should a claim have to be processed



Finally, when ... more

I recently spoke with them regarding taking on a courier franchise. http://www.fastwaycouriers.co.uk/8FranchOpp_CF_New.html

Now, I obviously did some research online and found quite a few negative comments. It didn't bother me quite frankly as I appreciate owner drivers can whinge for Britain. There also seemed to be a few dissatisfied customers out their that had been stuck with prepaid labels they cannot use. However, I put this to the back of my mind and gave fastway couriers the benefit of the doubt as I wanted to hear what was being said directly from them.

First of all I'll tell you how fastways operates. the Master franchise has the licence for the whole of the UK. Who then in turn splits areas up and then sells them on to regional franchisees

The regional franchisees start at around £25,000 and then you obviously need working capital to subsidise the project while things get up and running which seems to be about £150,000

The regional franchisee then breaks up this area and sells them to courier franchisees which usually consists of a van and a driver covering an area.

As a new franchise the whole of the UK isn't covered so the parts that aren't covered by fastways the freight is sent through an onforwarder which could be parcelforce or DHL.

In practice this seems like a solid business opportunity but let's start picking at the cracks a little.

My feeling is that the Master franchise has no real financial commitment to the network. They are responsible for the franchise service office (fso) and the main hub which I believe is in Leicester. They do not seem to start up depots until a regional franchise has been bought and so it's the regional franchise that is spending the money on that area not the Master franchise.

Moving onto the Regional franchisee, the areas are listed for sale in various franchise magazines for £13,500 and then you're guaranteed an income of £600 for 21 weeks. If my franchise are turned over £500.00 I would receive £100.00 to top it up. If it turned over £100.00 per week I'd receive £500.00. This struck me as a little odd as the harder I worked and the more my turnover increased in those first 21 weeks the MORE I would be paying for a franchise.

A lot of people who have owned courier franchisees in the past have complained that fastways are guilty of churning. Personally I don't believe this to be the case. I honestly believe that it's just poorly thought out and the lower down the food chain you are the worse deal you get. Some more forward thinking regional franchisees (RF) offer the franchise at a lower price with less of a guaranteed income. Before one discussion thread was closed down on the businessesforsale website a RF was willing to start the right person with a van and if they turned over £xx amount within three months he would give them the area. Having said that the RF would probably be covering the area with an owner driver at his own cost so he would still be geting a good deal out of it, although this isn't to say he wouldn't have been willing to negotiate.

Another problem is regional franchisees going bankrupt, shutting up shop or dropping postcode areas. The Master franchisee is not legally obliged to install depot managers and run these areas so the national delivery network through fastways shrinks and as a result becomes less of a attraction for customers. Obviously these areas are still covered by the onforwarders but at an increased rate.

I can't say for sure how many areas have entered into bankruptcy but the numbers do seem significant.

Which brings me to the COURIER FRANCHISE.

This is the area which I looked into. Now, once your up and running it is your responsibility to look for customers. This could be a case of calling in and chatting to the warehouse lad to see if they send out parcels etc. You then fill out a FAF I think it was called which the sales team then follow up. If the customer is interested they buy a set of prepaid labels from you and that's where you make most your money.

A courier also makes money making deliveries but the amount is so low you'll be lucky to cover you're fuel costs. I am aware of the prices and percentages paid to couriers but I think it would be unfair to fastway couriers if I put this in the public domain.

Your delivery area is run like a milkround so you'll go through a set routine in the morning, return to base at lunch at swap any parcels you have for local deliveries with other drivers for sameday PM delivery and then repeat the process in the afternoon. This was my first concern, if you're driving all the way back to your depot with one local parcel it's not financially viable. I am told that some RF have now dropped this idea but it does then lead to inconsistency throughout the network.

My second worry was the delivery of my parcels. The parcel industry would be an easy business if we didn't have to deliver parcels but unfortunately we do so what would happen if a parcel had to be delivered in the sticks taking the driver 20 minutes to do. With the amount they receive for deliveries then it's my opinion that this wouldn't get done until the driver had the volumes to do so. From a financial standpoint that makes complete sense and at the end of the day we all work to put food on our own plates not somebody else's. So the network is only as good as it's weakest link. I may have the greatest customer in the world who's making me a fortune but if I'm being let down by the delivery drivers at the other end I stand no chance.

INSURANCE
Covered up to £500.00 which is a huge amount for the parcel industry. Unfortuately as an courier driver I would be responsible for paying half the excess which is £100.00 split between myself and the RF. I struggle to see how when I'm receiving substantially less that 50% to collect the parcel I should be liable for that when things go wrong. This would also wipe out a substantial amount of profit should a claim have to be processed

Finally, when you buy your franchise it's from the RF if they go bankrupt remember as I said previously the Master franchise has no legal obligation to keep the depot running. If you take over an area that has previously had courier franchise that has gone bankrupt and left customers with tickets you'll be expected to honour these

In conclusion the company on paper seems like an excellent investment but unfortunately I believe that the lack of investment from the top is hampering it flourishing. If you had the volumes and depots in place this would be a profitable little business for a courier franchisee. The MF and to some extent some regional franchisees are not willing to subsidise in the short term for greater rewards in the long run.

 

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