- Perform market research and create a business strategy, to ascertain whether starting a courier service is feasible or not.
- Having a robust online presence that includes a website and social media pages can assist to promote the company and draw in new customers.
- Operating a legal and compliant courier service requires adhering to industry standards, such as getting the required permits and licences and keeping the appropriate insurance coverage.
- To deliver top-notch courier services, a professional crew must be hired and trained, including drivers and customer support personnel.
Courier business is not a new concept to anyone; however, it is a lucrative business that will still continue to boom. Don’t believe us? The global courier market is expected to grow by $159.66 billion and at a CAGR of 7.53% between 2022-2026.
Thus, it is the perfect time to do it if you are planning to start a courier business or want to thrive in this industry. This means you are on the right page because we will provide you with information that you should know about starting a courier business.
In this article, we will discuss how to start a courier business in 8 simple steps. So, without any further ado; let’s get started.
Table of Content
8 Steps to Start a Courier Business
While running your courier service business, you are your own boss. So, taking the necessary steps while establishing your courier company is essential. Below are some of the steps you need to follow in order to become a successful courier business.
Step 1: Choose the type of courier
Courier service is a vast business with numerous categories and types. Therefore, it is not possible to provide delivery service for every category. So, it is necessary to find your target market and niche before starting your new courier business in full fledge.
In the courier business, there are many categories like
- Standard delivery– where you are providing delivery in 2-3 working days.
- Same-day delivery– when the delivery is performed on the same day.
- Overnight delivery- also known as next-day delivery, allows you to deliver the next morning.
- International courier– where you can deliver items to a foreign land.
You can establish and grow your business by focusing on any one of these categories in the initial stages. After gaining customers’ recognition and having adequate funds and plans, you can start offering other categories also.
Step 2: Make a business plan
Establishing a courier service company from scratch requires a plan and implementation ideas in mind. Having a business plan can help you design your company’s goals.
Some of the primary aspects you should cover in your business plan are:
- Target potential customers
- Marketing strategies
- Costs and pricing
- Rules and regulations
- Fund management
Also, determine whether you want to start a business as an individual courier company or merge with existing courier companies.
Step 3: Do necessary investments
Before beginning any business, it is necessary to invest in different forms. In the courier industry, the most expensive investments are in vehicles and warehouses. You will need a warehouse to store and dispatch couriers from different centers.
In the last-mile delivery business, vehicles are one of the vital needs. It is used to carry goods and couriers from one place to another. Different vehicles are used in the local courier business like motorbikes, bicycles (less preferred), and delivery trucks.
Workers’ salaries should also be counted because they occupy a major part of your company’s investment. Also, it is preferable to cover your delivery vehicles with business insurance, and delivery persons with health and life insurance.
Step 4: Define your digital identity
Running any business in the 21st century without creating a digital identity will lead your business nowhere. Creating a digital identity includes a logo, business cards, taglines, enlisting in Google, a robust website, and a strong social media presence.
It helps you sustain in the market digitally and grab customers’ attention that there is a new business in the market. Also, you need to invest in branding to create a digital identity.
Step 5: Clear your legal formalities
Like every other business, starting a courier service requires legal permissions and paperwork for legal structures. First, decide the business structure and ownership of your business, whether it is a sole proprietorship, partnership, corporation, or limited liability company (LLC).
You need to get permission for a business license from your local corporation. Also, do not forget to register a federal employee identification number (EIN). Apart from this, do ensure to open a business bank account to keep the business and personal expenses separate.
Step 6: Recruitment and training
When you hire employees for your courier business, many aspects must be taken care of. Firstly, candidates should be interviewed and examined in a way that fits the job profile.
For example, if you are hiring courier drivers, ensure they have satisfactory driving skills. Candidates should have a clear road accident record and have all the documents ready.
Training includes package handling, basic customer service skills (etiquette), delivery methods, driving skills (for the delivery driver), a decisive mindset, and teamwork. They should develop an attitude as if they are working for their own courier business.
Moreover, do not forget to get business insurance to safeguard your business with appropriate liability insurance plans.
Step 7: Develop marketing strategies
To develop a successful business, it is crucial to design and implement different marketing plans. Build your social media network on apps like Facebook, LinkedIn, Instagram, and Twitter. These networks will help you to reach a wider customer base.
Apart from word of mouth, focusing on print media will help you get the attention of customers unavailable on digital platforms. Print media includes newspapers, brochures, and pamphlets.
Make sure to use tools and strategies like Google Ads and Search Engine Optimization (SEO) that help you gain traffic on your website.
Step 8: Come up with new strategies
Review the locations where you are planning to start your courier business. You need to stay organized and plan everything in a list so there is no confusion ahead in the business. Also, as a business owner, you will have options to make changes accordingly.
Also, ensure that you do not overspend your budget on irrelevant expenses. As far as expenses are concerned, let’s see how much it costs to start a courier business.
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What is the Cost of Starting a Courier Business?
The average cost to start a courier business is $1000-$4000. However, it always depends on the type of courier business you are planning. So, you can expect at least $900 to start any courier services. The cost of vehicles, drivers, logistics, and delivery resources are the factors behind the cost.
If you are a startup or small company, you could purchase a small vehicle such as a bike or scooter, but if you want to invest more, you could purchase a truck or van.
The below table will guide you on the cost of starting a courier business-
|Resources for Business||Average cost|
|Business name and corporation||$150|
|License and permits||$200|
|Initial marketing budget||$750|
Perform Courier Deliveries Efficiently with Upper
If you are starting a courier business, the first 100 or more deliveries are essential for your business. Thus, you have to make it right by providing efficient deliveries and excellent customer service. And, that’s what Upper Route Planner brings to you.
Why Upper for your courier delivery service?
Being a delivery management tool, Upper cuts down on the number of hours needed to plan routes and to follow up with customers and drivers. Here’s why Upper Route Planner can be used by courier businesses:
1. Excel Import
With Upper, you can import multiple addresses directly using the Excel spreadsheet. Thus, you will only need a few seconds instead of spending hours planning routes. Moreover, you can set stops on priority and time windows to make the delivery process more efficient.
2. Route planning and optimization
This software allows you to plan and optimize routes in seconds. Whether you are a startup, a small, or a larger courier business, Upper makes your delivery process easier with its automated routing features.
3. Proof of delivery
The electronic proof of delivery helps to get the proof of service after successfully delivering the courier. You can also collect digital signatures and capture photos of couriers as a proof. This will increase the accountability of the courier person and keep everyone updated about it.
Hence, it can be your go-to software in your day-to-day courier delivery operations.
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Mainly there are 3 types of courier services:
- Local courier: this category covers all the delivery operations across the same city.
- Instant/One-day courier: it is helpful for urgent deliveries. Their area of operation could be local, interstate, or overseas. Basically, all the time-sensitive deliveries are covered in this category.
- Overseas courier: it is for transporting goods from one country to another. It is carried out by airways and waterways transportation facilities.
The courier rate is based on the distance and area. You should calculate the cost of fuel, usage of the delivery vehicle, storage cost, and delivery driver commission/salary. The total would be your cost and then add charges compensating your profits.
Yes, courier businesses are profitable. The average delivery services make $12/ per hour and $30 for one service. However, the charges change according to the central locations, delivery times, and level of experience the courier business has.
Starting a courier delivery business and competing with other local businesses is not that easy. Starting a business from scratch and converting it into a successful courier business model requires a lot of preparation.
Along with efficient skills and planning, it is necessary to use route planning software like Upper Route Planner. It eases your managerial work, helps you optimize delivery routes, and lets you stay updated with the delivery status. Sign up and avail 30 days FREE trial to obtain the benefits of your courier service.