FedEx at Forty: How It All Began

Three of the company's earliest employees recall how FedEx got off the ground.

by

Most people skimming the December 20, 1972, edition of the old Memphis Press-Scimitar probably overlooked a tiny article buried in that day’s business section. The headline announced, “Jet Air Freight Line Weighs Opening Branch in Memphis.” Anyone who bothered to read further learned that “Federal Express, a Little Rock-based jet air-freight line, is considering putting a branch operation at Memphis International Airport.”

Well, so what?

After all, Memphis was home to manufacturing giants International Harvester, Kimberly-Clark, Firestone, and Grace Chemical. We had a growing medical center, all sorts of city, state, and federal government offices, and a huge Internal Revenue Service processing center near the airport. A Little Rock company hardly seemed worthy of a news item, even if they did plan to open a “branch operation” here.

Toss aside 40 years of calendars, and that little newspaper clipping now has considerably more significance, doesn’t it? The big industries are gone, most of the manufacturers have left town, and the IRS center — along with just about everything else along Democrat — was taken over by that “Little Rock freight line.” Today, the economic giant of  this entire region is FedEx.

But it absolutely, positively didn’t happen overnight.

 

 

 

We’re not aviation experts, but we 
imagine the first thing a brand-new airline needs is airplanes. That’s how Bruce Popp came to be the 18th employee hired by FedEx; in fact, Fred Smith is the only person in the company who has been employed longer.

In the early 1970s, Popp was working for Pan-American Business Jets, based in Roswell, New Mexico. A French aviation firm, Avion Dessault, had teamed up with Pan-American to design and build sleek little luxury jets for business commuters. “Well, by the time we got delivery of 35 of those planes,” says Popp, “the market just fell out.”

The company was so desperate to get rid of its surplus inventory that they considered trading one of the airplanes for a taco factory in Mexico, thinking it would be easier to sell the factory than the airplane.

“But then this Fred Smith fellow comes along and buys the whole lot,” says Popp, whose job was to fly the planes to Little Rock, where they would be converted into cargo planes. This wasn’t an easy task.

The twin jet engines were removed and sent to General Electric for upgrades, since they would need considerably more power when loaded with freight than a few business passengers. According to Popp, Smith found an engineer named Gomez Jones to design and incorporate the larger cargo doors and freight-hauling interiors, with an Arkansas firm, Little Rock Aeromotive, doing the conversions.

Popp had delivered three of the Falcons to Smith in Little Rock, he says, “when I realized I was working myself out of a job. Smith would have all the Falcons, and I wouldn’t have any work.” So he talked with Smith about joining his company. Like so many early FedEx employees, he was intrigued by this concept of an all-package airline. Popp had earlier worked for his father in the construction business, and remembers when he had to ship a huge diesel engine crankshaft by truck, a slow and costly process. “During the interview, [Smith] told me the world needs a way to move freight that’s more reliable than the regular airlines, and right away it clicked with me. I thought, ‘Smith is right about this; the world needs this.’”

Popp was hired on May 1, 1972, as an airplane mechanic. He was quickly promoted to line supervisor, shop supervisor, and then moved into the engineering department. “What I’m doing now is strategic project engineering, which looks at how high technology can be applied to the airline.”

Projects include new fire suppression systems for the cargo hold, better security systems, lighter cargo containers, and something he calls the “magic window” — a device that lets pilots see through fog, clouds, or smoke. This works better than radar: “So if you’re going through a mountain pass at night, or in fog, with high peaks on either side of you, it’s just like you’re flying in daylight.”

Things weren’t always so sophisticated. The Falcons could only carry a payload of about 6,000 pounds (by comparison, just one of the modular containers in today’s larger jets holds that much). And the little planes were bulk-loaded, which sometimes caused interesting problems.

Petroleum companies often sent sample gallons of gas, “and every so often one of those containers would leak,” he says, “so you can imagine having a gallon of gasoline leaking inside an airplane.”

But the night that especially stands out for Popp was when a live cobra, shipped from a zoo, somehow got out of its box and slithered around the plane. A hub employee caught it and thought it was a harmless black racer. That was until they unloaded the empty shipping carton, clearly labeled LIVE COBRA. “That was kind of interesting,” he says, matter-of-factly.

Popp has witnessed countless changes in airplanes and technology over the years. “When we started off here, the hub was like a big tin barn, about a quarter of a mile long and as high as a garage. We had three old National Guard hangars and one conveyor belt, and I was told the capacity was 15,000 packages a night, and that was it.”

Today, the hub sprawls across 863 acres, stretching along Democrat between Airways and Lamar. One night last year, the company sorted more than 19 million packages. “If you do a hub tour, it’s hardly believable from what it was like back then to what it is now,” says Popp, “and I watched it grow.”

 

 

 

Like Popp and many other FedEx employ-
 ees, Downie Talbot remembers the exact day he was hired — March 7, 1973, and his employee number: 448. After studying political science at Hendrix College in Arkansas, he worked with the U.S. Capitol police force in Washington, D.C., before his 40-year career with FedEx “just dropped into my lap.”

Talbot’s brother lived down the street from Fred Smith in Little Rock, and arranged a job interview. Talbot remembers that Smith asked if he could fly “because in those days we were mainly looking for pilots,” but he landed essentially the same job he has today, as manager of Global Operations Control, supervising the employees who keep track of every plane, every shipment.

Every day he participates in a worldwide conference call, “where we look back on the past 24 hours and look ahead to the next 24 hours, reviewing all operations, delays, weather, and other issues. I get to be a Monday-morning quarterback, which is awesome for me.”

In the early days, Talbot says his team used old drafting tables and actually hand-drew the flight plans on big sheets of paper for every plane in the fleet, every night. Of course, that’s not as formidable as it sounds when the company had only 14 Falcons serving just 25 cities. Another device they employed was a wall map of the U.S., with one end of a ribbon (“in the beginning, I think it was just a shoelace”) pinned to Memphis. They would stretch the ribbon to various cities, and by counting the marks along the ribbon, determine the flying time for those Falcons to any city in America.

Another “bleeding-edge innovation,” as Talbot puts it, was a Rolodex. Yes, a card file. In the early 1970s, his staff scribbled down the standard flight information on index cards, along with the contact information for the planes and airports. A very basic communication system allowed them to talk to pilots by a regular telephone, whenever they changed a flight — if the Falcon from Newark needed to stop by Pittsburgh for an extra load, for example. “Of course, now we have satellite hookup and computers,” he says, smiling, “so the level of engineering is much more sophisticated.”

In the 1970s, Talbot remembers, a beer joint on Democrat called Lamb’s became a hangout for employees when their shifts were over. “Back then, we were a lot smaller operation, and we knew all the pilots,” he says. “We’d go over there and talk about the night’s operations, any issues they saw out in the field, or at other airports. That was our main chance in flight control to see it from their perspective.”

How small was the operation? Well, the first crew bus — designed to ferry flight crews from the planes back to the hub — was little more than “a motorcycle thing with a trailer” driven by one of the pilot’s wives. “Other pilots saw that and said, ‘Hey, we want one of those!’ so we have a fleet of crew buses now.”

Talbot clearly remembers the first night of operations in Memphis, when FedEx shipped only 186 packages. “The sort belt was only 50 feet long” — it’s more than a mile today — “but I remember thinking, why do you need this long belt? Just set everything on a table and have the crew pick up their packages and go.”

What did he think about such a slow start? “I wasn’t concerned about that first night,” he says. “The package count didn’t matter to us. We were tremendously excited because we knew we were headed in the right direction.”

 

 

 

Sherry Little paid attention when people
began to talk about a new type of airline. A student at Memphis State, she had worked several years for Hi-Air, a division of Holiday Inns, and “that really intrigued me — an airline for packages. I wanted to find out more.”

A friend put her in touch with his friend — a young fellow by the name of Fred Smith, and Smith actually wrote her back, encouraged her to apply for a job, and enclosed a job application. She had to fly to Little Rock, since that’s where the company headquarters were in the early days, and she got the job. “I didn’t actually interview with Fred Smith,” she laughs, “but I still have his letter, framed.”

Little was FedEx employee #268 and was one of the very first people to work in the Memphis office. In fact, she is today the longest tenured woman at the company. Back then, the overnight delivery service was still in the works, and the company was mainly running chartered freight. “They gave me a room, a desk, and a telephone, and my job was to tell anyone who called all the great things I could about Federal Express.”

It wasn’t exactly a promising beginning. “We were in an office building on Sprankel [off Democrat], and we didn’t even have the whole building — just the second floor. A precast-concrete firm had the ground floor, and I had to climb over all this concrete just to get to the stairwell. I remember thinking, ‘What have I done?’”

By early 1973, FedEx began to ramp up its services in Memphis, and in April of that year began its vaunted overnight delivery service, to just 25 cities at first, and then slowly expanding its coverage.

“We had a fleet of Falcons,” says Little, “and I can remember watching them refurbish the planes, painting them all purple, but they didn’t stay purple long because it tended to show every little scratch, so they soon went with all-white.”

Little began to work in the claims and customer service division, helping customers trace their deliveries. “I remember going to a company meeting, and Fred was telling us how one day we could sit at our desk and track a package on our computer,” she says. “We laughed, because back then a computer was the size of a room. But he had a vision, and all we had to do was grasp it.”

That wasn’t so easy to do when the most high-tech equipment you had was a telephone. Each day, the couriers would call Little and her colleagues and report when and where their deliveries were made. Each night, the airbills were hand-delivered to her offices.

“Customers would call us if they wanted to find a package, and we had to go through the delivery records one by one,” she says. “All we had was one filing cabinet, which only one person could use at a time, and so an engineer came in and built a big wooden box, and all the airbills went into that.”

Looking back over the years, she says the most amazing advancement has been the advent of computers in every phase of the operation. “It’s just been mind-boggling,” she says, “to go from a delivery record on paper to everything stored on a computer.”

One thing that hasn’t changed about FedEx is the company’s “whatever it takes” culture. “Everybody really wanted the company to succeed.” For her, that meant working her regular 6 a.m. to 3 p.m. shift, going home for a few hours, and then returning to work to finish tracking more packages. “That way, our sales team could go to their customers and show how we had tracked all their packages, and it helped them close the deal.”

In later years, Little moved into the media relations department. One year, she was chosen as the media assistant for a special project: bringing a pair of pandas from the National Zoo in China to Edinburgh, Scotland. “It was a really big deal. We worked with the zoo to set up the event, and the media coverage was just insane, because everyone was so eager to see the pandas. That was the most amazing trip of my entire life.”