So you want to start a courier business? Great! You’re in good company! According to Logistics News, the analysts predict an annual growth rate of 12.76% in North America for last-mile delivery between 2018 to 2022. The total industry is predicted to go over $53 Billion by 2027. With the rise in the number of daily deliveries, courier companies are bound to grow and expand in the next few years.
This is great news for you! Now here’s the tricky part: how do I get started with my courier business? And more importantly, how do I build a successful courier business? In this article, we wish to create a quick checklist to answer some of your most common and basic questions about starting a courier business.
Table of Contents
What is a Courier?
A courier delivery business is a type of service that ensures the transportation of packages, envelopes, items, and paperwork to customers in a customer service area. This type of delivery service can take many forms, including bike couriers, car couriers, etc. The owner-operators can do the deliveries themselves, or they can hire employees. The small business can serve various customers and package types, ranging from deliveries of food, errands, packages, legal documents, and more.
For more information, consult our previous article:
4 Questions You Should Ask Yourself Before Starting a Delivery Business
Checklist – 32 Steps to Get Started with Courier Business
Below is a checklist for starting a courier business.
Research for Courier Service Business
1 – Research the courier industry as a whole. What are the overall trends of the industry? Where are the opportunities? Where does your business idea fit in?
2 – Do a competitive analysis of courier businesses in your metropolitan areas (or municipality). Every metropolitan area has its own regulations. Look at all types of courier companies in your state and your country. This will give you an overview of how the market works locally and nationally.
3 – Research the existing type of courier services and see if there is an underserved market. This will help you define your niche better—your chances of coming up with something new increase if you try to satisfy an underserved market.
4 – Start talking to another owner who runs a courier business startup. Hint: Reach out to someone in another area or a different type of marketplace. Speak to small business owners who offer delivery as a service.
5 – Go and see another local courier business, put in an order and see how they run their delivery services. This will give you an idea about the process.
6 – Talk to 10 customers who may want your services and do a customer discovery process with them. (ex: if you want to service lawyers, do user interviews with lawyers). This will help you with practicing your customer service skills while defining your niche and overall business goals.
7 – Create a competitor analysis spreadsheet. Create an excel where you compare all your competitors (the type of courier service business, small business or large, type of customer base or target market, pricing, etc.)
8 – Figure out transportation – lease vs. buy. Note: this also depends on the delivery jobs you will do. Are you serving a flower company or delivering documents? Will you offer shipping services as well? This will influence what questions you need to ask in terms of vehicles.
9 – Looking into franchises – does this work for your business? Is this a good way for you to start a courier business
10 – Before this phase, ensure you’ve done extensive research on what type of courier company and courier and errand service you wish to start. When starting a courier business (or any business for that matter), research and planning are generally 80% of the work.
11 – Choose the type of courier service business you wish to run. (errands, packages, shipments)
12 – Choose your customers (or niche) for your courier service
13 – Start thinking about your courier rates or pricing structure. Make sure that these courier rates flow from your research.
14 – Money – Determine how much money do you want to make. We don’t like talking about money, but it’s important!
15 – Write a full courier business plan – Make sure you have these sections – financials, operations, marketing, sales, human resources)
Legal and Administrative
16 – Choose a new business name and check to see if the business name is not already taken in the registry of your jurisdiction or the secretary of state.
17 – Get a tax identification number for your business entity.
18 – Get a business license – all businesses need one! There will be additional licenses required depending on the size and type of business.
19 – Get vehicle insurance for your fleet (important for the operation of your business!)
20 – Choose your type of business (sole proprietorship, partnership, etc.). Try protecting your assets by forming a limited liability company.
21 – Choose a company name
22- Choose your branding (color schemes, fonts, look and feel)
23 – Get Business cards (many businesses offer these services online)
24 – Create a website, get an email address, have a social media presence for marketing-related activities. (again, many businesses offer a way to set up a website for your business)
25 – Start making a list of prospective, repeat, and new customers or clients for your business and decide on a pricing structure.
26 – Create an excel sheet or a CRM to keep track of customers. This won’t be very pleasant initially, but all businesses generally agree that this is useful in the long run!
Getting set up
27 – To start as a courier company (or any business for that matter), there are always things to do to get set up, like getting a computer or other equipment.
28 – Get the capital (money) you need for starting a courier business. Get a separate business bank account for business cash flow and regular business expenses. Check if you are eligible for a small business loan.
29 – Identify key employees, drivers, or contractors.
30 – Identify partners, suppliers that help you and your courier company.
31 – From the information gathered in the research phase, choose a vehicle (box truck, hand truck, cargo van, motorcycle, etc.) that will be appropriate to your services and your deliveries.
32 – Ensure you have a great route planning tool or technology. It will determine how your deliveries will be carried out daily. We recommend Upper Route Planner as we think it’s the best combination of ease of use, design, and value. However, you are free to look at other options if you are so inclined! You will need a GPS unit or tools that work on mobile phones to receive accurate pickup and drop-off locations.
If you’re looking for more options, you can check out our blog
What is the Best Courier Route Planning App in 2021
With all the information presented above, you are ready to go! There is much yet to do. However, you have the basics that courier business owners need to know about. As and when you move ahead in your business, you will find ways to accommodate new market and business requirements.
Even if you plan to start the business on a smaller scale, you must refer to how courier companies like UPS and FedEx do their deliveries. Trying to learn from established companies will help you understand the business process better.
A business in the courier service industry makes money by providing a valuable service to customers. This service includes document delivery and deliveries of goods, services, or food.
Short answer: yes. It is hard to start any business. A smart business owner will tell you that you want to do your research to get data and information. This will reduce the risks and difficulties associated with starting a business.
Congratulations! You are your own boss now! Did you think it would be easy? Sorry! There are lots of steps in the process. However, as is the case for most businesses (courier service or otherwise), it’s certainly a worthwhile endeavor. We hope you found this interesting and useful. As always, let us know if there is anything we can do to help you.