Buy a FedEx Route in Denver, CO

What You Are Actually Buying

A FedEx route is not a franchise and not a job. It is a contracted service agreement between you and FedEx, giving you the right to operate delivery runs within a defined territory.

Most routes sold on the open market are Ground or Home Delivery routes. You own the vehicles, hire the drivers, and run the operation as an independent service provider (ISP) under a contractor agreement with FedEx.

Cash flow comes from the contracted rate FedEx pays per stop and per package. Expenses are vehicle costs, driver wages, fuel, insurance, and maintenance. What is left after those is yours.

Denver Market Context

Denver sits in a strong position for last-mile delivery businesses. The metro area has a population of roughly 713,000 within city limits and a broader metro exceeding 2.9 million. Median household income is $91,681, which supports a high e-commerce penetration rate and consistent residential delivery volume.

The Front Range corridor, including Aurora, Lakewood, and Centennial, generates dense stop counts for Ground routes. Higher density per stop means better economics per driver hour.

Colorado's economic base is diversified across tech, aerospace, healthcare, and energy. That mix reduces the cyclicality risk you would see in a single-industry market.

Deal Economics for a Denver FedEx Route

FedEx routes in the Denver metro generally list between $150K and $600K. Smaller single-truck operations with one or two drivers sit at the low end. Multi-truck ISP operations with $500K or more in annual revenue sit at the top.

A realistic mid-market example: a route with $320K in annual gross revenue and $87K in net owner earnings (after driver wages, vehicle costs, fuel, and insurance) might ask $350K, implying a 4x multiple on net earnings.

SBA financing for that deal looks like this:

• Asking price: $350,000
• SBA loan (90%): $315,000
• Equity injection (10%): $35,000, structured as $17,500 buyer cash (5%) plus a $17,500 seller note on full standby at 0% interest (5%)
• Annual debt service on $315,000 at approximately 10.5% over 10 years: roughly $51,500
• DSCR: $87,000 / $51,500 = approximately 1.69x

That DSCR clears the 1.5x floor. To hit the 2x target, you want net earnings around $103,000 or better at that loan size. Push for a lower asking price or negotiate a stronger seller note to improve the coverage ratio.

These are estimates based on current SBA market rates. Actual terms depend on individual qualification and lender.

What to Look For (and What to Avoid)

The contractor agreement is the asset. Before anything else, confirm the ISP agreement is in good standing and transferable. FedEx can and does terminate underperforming contractors. A route with a clean compliance history is worth paying up for.

Verify volume history directly from FedEx-issued settlement statements, not seller-prepared summaries. You want 12 to 24 months of settlement data to see seasonal patterns and any revenue trend.

Driver retention matters more than people expect. A route where the seller is the only driver is a business that depends entirely on one person showing up. Routes with two or more established drivers are operationally cleaner on day one.

Watch for deferred vehicle maintenance. A fleet that looks clean on the surface but has aging transmissions, bald tires, or skipped service intervals can erase a year of cash flow in the first six months.

SBA Financing for FedEx Routes

SBA 7(a) is the standard financing vehicle for route acquisitions in this price range. The program works well here because FedEx routes have identifiable cash flow, hard assets (vehicles), and a contracted revenue stream that lenders can underwrite.

Current SBA 7(a) rates run approximately 10% to 11% (WSJ Prime plus 1.5% to 2.75%). Over a 10-year term, that translates to meaningful annual debt service, which is why getting the entry multiple right matters so much.

The equity injection is 10% of the purchase price, structured as 5% buyer cash and 5% seller note on full standby. Full standby means no payments on the seller note during the SBA loan term. Regalis Capital achieves this structure on more than 90% of its deals.

At $350K, your out-of-pocket cash at close is $17,500. That is the real cost of entry.

One note: some lenders are cautious about FedEx routes because the contractor agreement is not a traditional lease or license. Work with an SBA lender who has funded route acquisitions before. It shortens the process and reduces the risk of a last-minute underwriting issue.

Frequently Asked Questions

How much does it cost to buy a FedEx route in Denver?

FedEx routes in the Denver metro typically list between $150K and $600K. Smaller single-truck operations land at the lower end, while multi-truck ISP businesses generating $500K or more in annual gross revenue command higher prices. Multiples generally range from 3x to 4.5x net owner earnings.

Can I use SBA financing to buy a FedEx route in Colorado?

Yes. SBA 7(a) is the most common financing tool for FedEx route acquisitions. The loan covers up to 90% of the purchase price with a 10% equity injection structured as 5% buyer cash and 5% seller note on full standby. At a $350K acquisition price, the buyer's cash out of pocket is approximately $17,500.

What is a good DSCR for a FedEx route acquisition?

Regalis Capital targets a 2x debt service coverage ratio as the standard, with a hard floor of 1.5x. For a $350K acquisition financed at 90% SBA over 10 years at current rates, annual debt service runs roughly $51,500. You need net route earnings of at least $77,000 to clear 1.5x, and $103,000 to hit 2x.

What documents should I request when buying a FedEx route?

Request 12 to 24 months of FedEx-issued settlement statements (not seller summaries), the current ISP contractor agreement, vehicle maintenance records and titles, driver employment agreements or 1099 records, and at least two years of business tax returns. Settlement statements are the most important item and should be verified directly.

How long does it take to close a FedEx route acquisition with SBA financing?

Most SBA-financed route acquisitions close in 60 to 90 days from signed letter of intent. The timeline depends on lender underwriting speed, SBA approval, and how quickly FedEx processes the contractor agreement transfer. Working with an experienced SBA lender and an advisory team that knows the process can compress that window.

Ready to Run the Numbers on a Denver FedEx Route?

If you are seriously evaluating a FedEx route acquisition in Denver, the deal math needs to be right before you sign an LOI. Regalis Capital reviews 120 to 150 deals per week and works directly with buyers to evaluate route financials, structure the financing, and negotiate terms that protect your position.

Start with a free deal assessment: https://resource.regaliscapital.com/deal