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FedEx Freight | 2015 Annual Report

The Point said:
I would like to enter into evidence the fact that the company admits to over hiring last winter/spring. This could also account for part of the salaries and employee benefits 8%.
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Hear ye....here he.....

Let it be known that I stipulate to the point made by The Point....

While overstaffing may not necessarily impact work efficiency (though many times it does) the benefits cost is still there to be paid....

It is the freight business though and in all my time I can't say I have ever seen us at the "sweet spot" for any lengthy amount of time....overstaffed or understaffed both have their drawbacks on cost and overall workforce morale....

Carry on....
 
SwampRatt said:
Extremely well played :clapping:

As a member of the Official Opposition, I'd like to invoke Parliamentary Privilege, and present a Petition, to The Chair, calling for a Point of Order, in the matter of direct and equal correlation of work (wages), to costs, as a percentage. Also, I call on the Chair to strike from the record the reference to revenue being down 1%, while the Non-Partisan report clearly shows revenue up for the 3 month reporting period. :order:

Seriously, you make a very valid point, although double the work does not equal double the cost, especially in the city operation, due to efficiency/density factors that automatically come into play. Now in the line haul area, it gets much closer, perhaps even a near point by point correlation, I'd expect.

Again, clearly a factor., and a good catch. One I should have brought up :duh:. I did notice that at 1st glance, but then was disappointed in the revenue per numbers.

Interestingly, revenue, up 1% for the quarter, is actually down (1%) for the 9 month period, while wages/benefits maintain that +8% constant. That 8% shows steady, even while the number of shipments improved significantly in the quarter vs the 3 quarters reported (+7% vs +2%).

Bottom line, despite the market conditions, we are doing something very right. We are gaining market share, even in the down market. Something other carriers would love to be able to say, IMHO.

Again, you are absolutely correct that increased workload effected wage and benefit costs. Well done. :1036316054:
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I certainly do not view my esteemed colleagues of the truckingboards forums as "opposition". Like you said, a bit of bi-partisanship can go a long way towards understanding and correcting issues.

I do ask that the members be lenient and not censure myself for the clerical error that my aide made regarding the revenues while preparing my draft, Bill Clinton recommended I put her on my staff, but I am beginning to believe it wasn't for typing ability.

You pretty much got my point.......if it weren't for some efficiency increase along the way, we would have likely seen a much larger increase in wages......say 11-12% when the workload growth is added to the wage and benefit increases. Really illustrates the importance of trying to keep getting more efficient where we can to be able to offset the deserved increases.

I agree that we are in a pretty good position if we can keep the share once pricing comes back, but hauling freight at no profit isn't the ideal either....

I digress and return the floor to the members....
 
I need to correct one entry into the record, if The Chair will allow it.

I would be derelict in my duties if i did not point out that even though we stated that compensation increases for the members were from <5% to 10.7%, (depending on GPD status) the truth is, only the wage portion of the compensation package went up to that degree. Not the entire package, therefore the impact as well as the actual benefit, as a percentage increase must be reduced.
 
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SwampRatt said:
I need to correct one entry into the record, if The Chair will allow it.

I would be derelict in my duties if i did not point out that even though we stated that compensation increases for the members were from <5% to 10.7%, (depending on GPD status) the truth is, only the wage portion of the compensation package went up to that degree. Not the entire package, therefore the impact as well as the actual benefit, as a percentage increase must be reduced.
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Correct, but we also know that the cost of health bennies increased as well,
SwampRatt said:
I need to correct one entry into the record, if The Chair will allow it.

I would be derelict in my duties if i did not point out that even though we stated that compensation increases for the members were from <5% to 10.7%, (depending on GPD status) the truth is, only the wage portion of the compensation package went up to that degree. Not the entire package, therefore the impact as well as the actual benefit, as a percentage increase must be reduced.
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No objection, your honor......

I would like the record to show however that I believe there are increases to the health benefit costs that must be taken into consideration as well, the data is just not available to show exact amounts. Say a mean average of the 2 studies linked, 4-ish %?

Where are the total compensation statements when we need them?
 
aflifer said:
Correct, but we also know that the cost of health bennies increased as well,


No objection, your honor......

I would like the record to show however that I believe there are increases to the health benefit costs that must be taken into consideration as well, the data is just not available to show exact amounts. Say a mean average of the 2 studies linked, 4-ish %?

Where are the total compensation statements when we need them?
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Oh yes, I remember those, fondly. I do agree.

As I recall, those were AF issued statements, were they not? :scratchhead:
 
aflifer said:
Correct, but we also know that the cost of health bennies increased as well,


No objection, your honor......

I would like the record to show however that I believe there are increases to the health benefit costs that must be taken into consideration as well, the data is just not available to show exact amounts. Say a mean average of the 2 studies linked, 4-ish %?

Where are the total compensation statements when we need them?
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Perhaps we could consider exhibit A, our W-2. While not all encompassing of the health care cost we can get an idea of some cost. For my examples I use the lower cost family plan and amount from line DD.
2013 $12,548.40
2014 $12,683.16
2015 $13,511.64
 
SwampRatt said:
Oh yes, I remember those, fondly. I do agree.

As I recall, those were AF issued statements, were they not? :scratchhead:
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Can't recall exactly where we were in our journey when we saw those....for some reason I was thinking it might have been shortly before the purchase and carried into the FedEx tenure a bit....
 
The Point said:
Perhaps we could consider exhibit A, our W-2. While not all encompassing of the health care cost we can get an idea of some cost. For my examples I use the lower cost family plan and amount from line DD.
2013 $12,548.40
2014 $12,683.16
2015 $13,511.64
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Good point, Sir Point.....big fan of Mr. Churchill by the way....

I would think that would give an idea of what we have seen historically, but can it help us with an idea of how 2016 will compare to 2015?
 
The Point said:
Perhaps we could consider exhibit A, our W-2. While not all encompassing of the health care cost we can get an idea of some cost. For my examples I use the lower cost family plan and amount from line DD.
2013 $12,548.40
2014 $12,683.16
2015 $13,511.64
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That would be a pretty good indicator...
aflifer said:
Good point, Sir Point.....big fan of Mr. Churchill by the way....

I would think that would give an idea of what we have seen historically, but can it help us with an idea of how 2016 will compare to 2015?
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Doubt there would be any significant spike from that trend, one way or the other.
 
The Point said:
I would like to enter into evidence the fact that the company admits to over hiring last winter/spring. This could also account for part of the salaries and employee benefits 8%.
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I wonder if the company saw some wisdom in maintaining a certain amount of workload, in order to keep many of those hired during that over hiring phase. It very well may be better to haul freight at a smaller margin temporarily, keeping those new hires content as much as possible, rather than suffer the burden of hiring replacements in a tightening market. Wise move if true, but just a theory.
 
SwampRatt said:
I wonder if the company saw some wisdom in maintaining a certain amount of workload, in order to keep many of those hired during that over hiring phase. It very well may be better to haul freight at a smaller margin temporarily, keeping those new hires content as much as possible, rather than suffer the burden of hiring replacements in a tightening market. Wise move if true, but just a theory.
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Good observation...

I would think so as well, but that is an area that I believe we need to be ultra cautious in.....not that we are in the same exact scenario, but we over did that concept back around 2010 to an extent and cratered our earnings. Tough balance to try and maintain, keeping the people you know you will be needing working as much as possible to avoid the significant cost turnover presents, but not bleeding cash while you do it.....
 
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