In reply to frenchyd :
You have been all over the place, so many tangents, even contradicting yourself with your own examples. So let's refocus this.
You claim doubling the labor rate will not only not cost anything, but improve profits. For those of us that haven't moved past 2nd grade math, show us. Not platitudes, platitudes don't have a column on the P&L. Show us the math.
In reply to wae :
Anyway, my point is simply this: I don't think FedEx actually cares because I think the general public doesn't care so much that they'll ever do anything that will have enough of an effect to move the needle on their revenue. And, frankly, if you're not going to generate more revenue or prevent the loss of revenue, it doesn't make sense to increase operating expense. For the most part, we aren't their customers, the large volume shippers are. And those contracts are won mostly on price.
This is what I was talking about earlier, this is a strange business in that the "customer" is not the one contracting the service. It's the shipper. This gets really frustrating on a commercial scale. The manufacturers choose the shipper. The freight cost is often rolled in to the product cost on large projects, so the manufacturer wants cheap freight. The product belongs to the customer as soon as it leaves the dock- even if it's damaged or lost. Many of these products are custom made, very expensive, and have long lead times. Not receiving the product in time will delay the job, delay payments, cause all kind of issues. We are meticulous about all aspects of the project when ordering- order confirmations, submittals, etc., making sure that every "i" is dotted and every "t" is crossed. And then we just cross our fingers and hope the freight company doesn't destroy or lose it. I've tried for years to get manufacturers to vet their shippers, not going to happen any time soon. It gets really bad when the contracted shipper sub contracts to another local company for the last leg of the delivery. Lots of finger pointing if something goes wrong, and zero accepting responsibility.
Edit- UPS is light years ahead of FedEx in my experience, especially now.
We could solve this entire issue by dropping small thermonuclear devices on all the Amazon hubs, and then mandating that we all have to purchase products from within our own borders. That would lessen the Fedex load significantly.
Hey, Frenchy started it. Not my fault.
In reply to Streetwiseguy :
To quote Frenchyd-
Problems have solutions. Management has to stop closing off their mind to possible solutions.
wae said:I'm curious how much of an effect this actually has on FedEx and how much of it is analogous to companies moving their call centers overseas. Or facebook/google/amazon not having a phone number to call or any other substantive customer support function. Or automakers not letting you buy a Civic with a manual in any color but grey. There exists a small group of dissatisfied customers who may be very vocal, but the vast majority of the customers just suck it up and keep coming back. If you polled 1,000 random people off the street, how many of them would honestly say that they won't ship FedEx or they won't buy from companies that only ship FedEx? And follow that up with what would they do if the non-FedEx option was 5% more expensive. What about 10%? As a society, we've decided that we're willing to sacrifice customer service and quality in order to get a less expensive product. Most of the time that's why we're having stuff shipped to us in the first place, let's be honest.
I know, that doesn't apply to you because you always buy local and happily pay two or three times more and so on. First of all, I don't believe you - there is always something that you'll decide that the quality or service isn't worth spending THAT much more for THIS little thing. Secondly, even if that is true, you're a weirdo in relative terms. And thirdly, yes, I do think the world would be better in many ways if more people were like you, but yet here we are.
Anyway, my point is simply this: I don't think FedEx actually cares because I think the general public doesn't care so much that they'll ever do anything that will have enough of an effect to move the needle on their revenue. And, frankly, if you're not going to generate more revenue or prevent the loss of revenue, it doesn't make sense to increase operating expense. For the most part, we aren't their customers, the large volume shippers are. And those contracts are won mostly on price.
I say all this while I wait on FedEx to make three deliveries to my shop this week. One claims to be OFD today, one claims to be arriving tomorrow, and the third says that FedEx hasn't received the shipment yet, but it'll be there Friday. These are all to a commercial address and it's always the same driver. Some days, he'll leave the package when I'm not there. Some days, he'll leave an "attempted delivery, no one was here" note. And some days he'll just drive right on by and not even make an attempt even though the tracking info will report that there was an attempt. So, it'll be interesting to see what happens this week.
Quoted for truth.
Everyone talks about quality and service and almost no one is willing to pay for it. Im not saying smaller niche markets for higher quality and services dont exist, they do, but on a large scale most things are being driven by price. Its not just shipping, you can see it in almost every industry.
I laugh when I hear people talk about the terrible conditions for amazon employees and turn around and order something from them.
Im not delusional, Im also guilty of this. Im aware of it so I do try to support whoever is doing the best job, but there are still things I shop solely on price.
You guys keep blaming the person that puts the package on your porch or a package handler..... that's a super small view of reality.
Let's assume I ship a car part to one of you.
1). I box the part and drop it off at Fed Ex store or schedule a pickup. Contractor 1 picks it up at either location and takes it to their terminal.
2). A package handler unloads it and it goes to a sorting area. It gets loaded on an 18 wheeler trailer driven by Contractor #2.
3). It goes to a major hub and is unloaded and handled by package handler #2 and get sorted again, handled by package handler #3 and put on another 18 wheeler owned by Contractor #3.
(this could happen even 1 or two more times)
4). That 18 wheeler drops its trailer at the destination terminal. It gets unloaded by package handler #4 and goes to sorting.
5). It gets sorted in a conveyor and loaded on a Ground truck by package handler #5. Then it gets driven to the destination and delivered by an employee of Contractor #4.
Please identify which one of these people harmed your package. You all and Fed Ex almost always blame the delivery guy for Contractor #4.
In Ground Fed Ex owns the terminals and all terminal employees. UPS owns all the employees and trucks in their system.
And don't go thinking UPS is the answer. They don't do so hot either. Last holiday season UPS cut off some of their biggest customers because they couldn't handle the volume. One was Macy's. Fed Ex puts the pressure on the contractors to handle all additional volume.
Boost_Crazy said:In reply to frenchyd :
You have been all over the place, so many tangents, even contradicting yourself with your own examples. So let's refocus this.
You claim doubling the labor rate will not only not cost anything, but improve profits. For those of us that haven't moved past 2nd grade math, show us. Not platitudes, platitudes don't have a column on the P&L. Show us the math.
Fair enough. I'm pretty rusty doing algorithms but here's my best efforts.
HM x2 = X$/hrs. - $ MC + IP - MW =net gain.
P&Ls are one of the major reason I'm not a Fed Ex contractor right now. It's amazing how many contractors simply cannot provide one to show a justification for buying their business. A bank can't even begin to figure out terms without a good P&L either. The revenue side is easy to figure out. All you need is your Fed Ex contract and volume history of the business you are analyzing. It's the expenses that are nearly impossible to quantify the way these businesses are run.
NorseDave said:So all of this discussion is directed at FedEx. From personal experience in my area, UPS is orders of magnitude better. They are, near as I can tell, direct competitors. So what's different?
They pay their warehouse workers twice what Fedex does.
Imagine if they quadrupled it. Your packages would arrive before you even ordered them.
In reply to frenchyd :
Uh- care to share with the class what all of your variables stand for?
Edit: I've been staring at your equation, trying to figure out what the variables stand for.
HM x2 = X$/hrs. - $ MC + IP - MW =net gain.
I don't think it matters. We can completely ignore the mess in the middle due to the 2 "=" signs, so
HM x2 = net gain. x2 must be the doubling the wages. So- jumping the gun a bit before you share your code- I googled what HM meant in the business world. Here is the top 10, It didn't help me much...
Hinge Mount
Head Madam - did not make that up
Hole Montes Inc.
Hiring Manager
Hydraulic Machine
Home Market
Houghton Mifflin Company
History Makers
Hindustan Motors
Hotel Margherita
I suppose doubling some of those might help profits. Some will definitely hurt. I guess we'll have to wait.
A short piece was published yesterday regarding Portlands FedEx struggles.
https://www.koin.com/news/portland/understaffed-fedex-hub-in-troutdale-slows-portland-packages/
In reply to rkteal :
And remember that 600k package shortfall is the official number and it's nationwide and most importantly it's daily. The labor shortage is national. Portland's terminal is probably one of the worst right now, but many terminals are struggling. Volume increased about 20 to 25% nationwide in the last 18 months. It's not hard to see how the system is hurting. The other piece of that is finding trucks. Just like new cars, and pickup trucks delivery trucks are in short supply and overpriced right now as well. A fleet of delivery trucks is expensive to own, maintain and keep on the road.
Finally got my most recent package that was shipped fedex.
Other than spending four days sitting in Colorado, then most of a week sitting 30 miles from me, and having an expected delivery date of 'last Thursday' until yesterday morning, went super smoothly.
/s
rkteal said:A short piece was published yesterday regarding Portlands FedEx struggles.
https://www.koin.com/news/portland/understaffed-fedex-hub-in-troutdale-slows-portland-packages/
Ha, timely article. I ordered some new boots that were supposed to arrive Saturday, then today, and now the tracking status just says "delayed." They've been in Portland for three days so far. And to add insult to injury, a FedEx truck parked in front of my house tonight and delivered something to my neighbor instead of me 
Maybe it's because I usually only use them to ship to a commercial address, but my biggest problem with FedEx is that the delivery driver will sometimes leave a Rock Auto package if I'm not there and sometimes he won't. Any clues on how to get them to just leave the stuff every time?
Boost_Crazy said:In reply to frenchyd :
Uh- care to share with the class what all of your variables stand for?
Edit: I've been staring at your equation, trying to figure out what the variables stand for.
HM x2 = X$/hrs. - $ MC + IP - MW =net gain.
I don't think it matters. We can completely ignore the mess in the middle due to the 2 "=" signs, so
HM x2 = net gain. x2 must be the doubling the wages. So- jumping the gun a bit before you share your code- I googled what HM meant in the business world. Here is the top 10, It didn't help me much...
Hinge Mount
Head Madam - did not make that up
Hole Montes Inc.
Hiring Manager
Hydraulic Machine
Home Market
Houghton Mifflin Company
History Makers
Hindustan Motors
Hotel Margherita
I suppose doubling some of those might help profits. Some will definitely hurt. I guess we'll have to wait.
HM = Highly motivated.
Yes it matters. When hired @ Caterpillar my predecessor had averaged only $197,xxx in sales and rentals per year. My first year I did 1.3 million and averaged 2.1 million, exact same territory.
Won't work on an assembly line type situation? Watch the video where the guy hooked a trolley to the frame of a Model T on the assembly line and sat on it while wielding 2 wrenches. The two guys on the other side of the car did the same job.
I'm 73 yet My kids arrive to the school 10 minutes early. Previous drivers were always late sometimes hours late. GPS reports any speeding or red light running. And the camera's in the bus would catch any rule I break. Each pickup has a scheduled time
MW is minimum wage. Not federal or state but the minimum wage people will respond to the job offering.
In reply to frenchyd :
You're still expecting people working for beer money to be motivated.
Money is a motivator, but these are NOT career jobs. These are, at best, stepping stones to less demanding jobs in the business, and more often, a way to have extra money for play or fill some time between classes.
NOBODY is putting in 10, 20 years loading and unloading trucks no matter how much money is involved.
I'd be curious to see an overlap of employees. Which way they've moved, which businesses they've stuck with or which turned through employees the quickest. Between FedEx and UPS hubs, and Amazon warehouses, because locally anyway they're all within 30 minutes of each other. Are people chasing the money, or the work load?
Still, I've had worse jobs for less money. Precast concrete plants make shipping hubs look like tropical vacations.
AnthonyGS (Forum Supporter) said:You guys keep blaming the person that puts the package on your porch or a package handler..... that's a super small view of reality.
Let's assume I ship a car part to one of you.
1). I box the part and drop it off at Fed Ex store or schedule a pickup. Contractor 1 picks it up at either location and takes it to their terminal.
2). A package handler unloads it and it goes to a sorting area. It gets loaded on an 18 wheeler trailer driven by Contractor #2.
3). It goes to a major hub and is unloaded and handled by package handler #2 and get sorted again, handled by package handler #3 and put on another 18 wheeler owned by Contractor #3.
(this could happen even 1 or two more times)
4). That 18 wheeler drops its trailer at the destination terminal. It gets unloaded by package handler #4 and goes to sorting.
5). It gets sorted in a conveyor and loaded on a Ground truck by package handler #5. Then it gets driven to the destination and delivered by an employee of Contractor #4.
Please identify which one of these people harmed your package. You all and Fed Ex almost always blame the delivery guy for Contractor #4.
In Ground Fed Ex owns the terminals and all terminal employees. UPS owns all the employees and trucks in their system.
And don't go thinking UPS is the answer. They don't do so hot either. Last holiday season UPS cut off some of their biggest customers because they couldn't handle the volume. One was Macy's. Fed Ex puts the pressure on the contractors to handle all additional volume.
Usually if I damaged a box it's because I fell or was going to fall in the belly of the trailer. Sometimes boxes would get smashed by other boxes as they fell down the chute.
RevRico said:In reply to frenchyd :
- You're still expecting people working for beer money to be motivated.
Money is a motivator, but these are NOT career jobs. These are, at best, stepping stones to less demanding jobs in the business, and more often, a way to have extra money for play or fill some time between classes.
NOBODY is putting in 10, 20 years loading and unloading trucks no matter how much money is involved.
I'd be curious to see an overlap of employees. Which way they've moved, which businesses they've stuck with or which turned through employees the quickest. Between FedEx and UPS hubs, and Amazon warehouses, because locally anyway they're all within 30 minutes of each other. Are people chasing the money, or the work load?
Still, I've had worse jobs for less money. Precast concrete plants make shipping hubs look like tropical vacations.
$60,000 a year isn't exactly beer money.
My proposal is to solve a problem with motivation. If you graduate from HS or get out of prison, step up from a minimum wage type job and get a chance to make really decent money if you can be more effective than the guy you replace. That's motivation.
To be smart, the opportunity should be given to existing people to step up. Both because it's unlikely highly motivated won't instantly show up and Some may feel with entry level wages also means minimum effort. Rewarding them might ( might) cause them to step up.
frenchyd said:RevRico said:In reply to frenchyd :
- You're still expecting people working for beer money to be motivated.
Money is a motivator, but these are NOT career jobs. These are, at best, stepping stones to less demanding jobs in the business, and more often, a way to have extra money for play or fill some time between classes.
NOBODY is putting in 10, 20 years loading and unloading trucks no matter how much money is involved.
I'd be curious to see an overlap of employees. Which way they've moved, which businesses they've stuck with or which turned through employees the quickest. Between FedEx and UPS hubs, and Amazon warehouses, because locally anyway they're all within 30 minutes of each other. Are people chasing the money, or the work load?
Still, I've had worse jobs for less money. Precast concrete plants make shipping hubs look like tropical vacations.
$60,000 a year isn't exactly beer money.
My proposal is to solve a problem with motivation. If you graduate from HS or get out of prison, step up from a minimum wage type job and get a chance to make really decent money if you can be more effective than the guy you replace. That's motivation.
As RevRico point out, it's part-time work @ 20 hours per week. That comes out to nearly $58/hr to unload and load boxes. That's just not realistic. Regardless of what formulas you make up.
In reply to z31maniac :
My claim was that highly motivated people will improve productivity. Not that some math formula would solve all of Fed Ex's problems.
Now you're saying that some arbitrary number is too much to pay to solve the problem. Fair enough. Tell me how big the problem is and how much can be spent to solve the problem and I can be more exact.
If you are telling me there is no cost to FedEx then perhaps they can lay off employees to save money?
Good people are worth what they cost. ( conversely bad people cost too much ). Once management fails to understand that, They are doomed.
In reply to frenchyd :
Health insurance would be better than more money.
Let me break down the local warehouses. These numbers are all current to my corner of southwestern PA.
Ups $20/ hour, 20 hours a week, union backing and benefits after however many days. Solo package handling up to 70lbs
Amazon $18.50/hour, 40 plus hours a week, and we've all read those horror stories. Solo package handling up to 70lbs
FedEx, $15/hour, 20 hours a week, no union, no benefits. Solo package handling "up there because finding help is hard when we're busy"
Dicks warehouse, $15.75/hour, 37.5 hours a week, full benefits from day 1. Package handling up to 20lbs.
UPS and FedEx are mostly staffed by college students because the 4 hour shifts work for them. Amazon seems to take any warm body. The Dicks warehouse is almost exclusively staffed by people who've gotten sick of UPS and FedEx work loads, or left their dealing with the public for $13/hour gas station jobs for greener pastures. There were a lot of ex steel mill people, but the mills have been gone long enough they're leaving the workforce.
Money only motivates so much. A E36 M3ty job is a E36 M3ty job no matter how much you make, and it will take it's toll mentally and physically.
Here's where it gets humorous, to me anyway. School bus/van drivers, cafeteria workers, and monitors start $10-12/hour. Head Start supervisors start at $13, teachers at $11, degrees and FBI background checks required. Driving around cleaning portapotties all day starts at $15. Meanwhile ALL of these places are hurting for workers, when 5 years ago, $15/hour was a high rate for this area.
In reply to RevRico :
I'd agree if you're married and your wife doesn't have insurance. But young and Single? Give the money.
You listed the reason for Fed Ex's problem. Ups gives more money plus benefits, a Union to protect against arbitrary firing or punishment.
So they are going to get the best and Fed Ex gets whatever is left. A shortage will be felt first at Fed Ex.
Motivation is going to be hard around there, grandfathers even some fathers will talk about Union jobs and benefits.
Then the jobs left ( and unions) survival became the norm with many losing their homes, savings, retirements, and the American dream. Come 2008 recession, more homes were gathered up, Bankers got richer while working was nearly impossible. Planning ahead many went to college on student loans. Trading for jobs that no longer were there. Finally to put the final nail in the coffin of motivation the pandemic.
Here in Minnesota bus drivers earn $22.50/ hr plus a $2.50/ hr bonus if you properly check in on time all week. Some companies / schools have unions some don't. If you hustle you'll get 1 /hr day midday plus about 10 hours a week for charters. To get that though you work 1/2 day. 6:00am to 6:30 pm and a couple of nights to 10-midnight. Yes 6:00 rolls around in a hurry when you're 73.
In reply to frenchyd :
HM = Highly motivated.
Yes it matters. When hired @ Caterpillar my predecessor had averaged only $197,xxx in sales and rentals per year. My first year I did 1.3 million and averaged 2.1 million, exact same territory.
Won't work on an assembly line type situation? Watch the video where the guy hooked a trolley to the frame of a Model T on the assembly line and sat on it while wielding 2 wrenches. The two guys on the other side of the car did the same job.
I'm 73 yet My kids arrive to the school 10 minutes early. Previous drivers were always late sometimes hours late. GPS reports any speeding or red light running. And the camera's in the bus would catch any rule I break. Each pickup has a scheduled time
MW is minimum wage. Not federal or state but the minimum wage people will respond to the job offering.
Okay, I walked into this one, I don't know why I was expecting anything more.
HM equals highly motivated!?! Highly motivated x 2? You literally plugged a platitude into an equation? A variable usually stands for a number, not an idea. How about we just double the pay, but instead of money, we pay the workers in platitudes and ideas? See, it doesn't work, you need numbers.
Frenchyd, I don't actually disagree with your core concept. Paying people to the point that the increased motivation or where the rate attracts more productive workers (or even just more workers) is sound, to a point. That point is called the point of diminishing returns. Where we disagree is that you seem to completely ignore that point, or at best think that point is 2x the current labor rate- a very aggressive claim- with nothing real to back that up. When I asked you for some numbers to support your claim, you responded with an unsolvable equation.
I can also tell you that some of the hardest workers I 've ever been around worked for low wages, and some of the laziest workers were well paid. I've seen low paid workers get large increases that they didn't earn, and become worse workers. They knew that were not good workers, and the big raise just told them that they were irreplaceable, so their production dropped. The point is, this is much more nuanced than you think, there is no easy answer, and no answer that is right for everyone.
frenchyd said:In reply to z31maniac :
My claim was that highly motivated people will improve productivity. Not that some math formula would solve all of Fed Ex's problems.
Now you're saying that some arbitrary number is too much to pay to solve the problem. Fair enough. Tell me how big the problem is and how much can be spent to solve the problem and I can be more exact.
If you are telling me there is no cost to FedEx then perhaps they can lay off employees to save money?
Good people are worth what they cost. ( conversely bad people cost too much ). Once management fails to understand that, They are doomed.
If someone is already working at near their max capacity, as RevRico already pointed out, doubling their pay isn't going to double their productivity. Period, full stop.
You get more out of touch with reality by the day. Hell, again, your own example of a business becoming more productive was not by increasing pay or hiring more workers, it was with mechanization, and now you have this made equation with hyperbole in it?
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