As online businesses become more popular, the need for courier businesses is growing high in demand. The market size and revenue of the Couriers & Local Delivery Services industry in the United States has been measured at $126.2bn in 2021. This means if you are considering starting up a business, a courier business is definitely a good option.
However, within the climate of struggling to get quality vehicles, reliable delivery men, and effective time management, courier businesses can prove quite difficult to start..
In this article, I’m going to show you how to start and run a successful courier business.
What is a Courier business?
A Courier business involves delivering packages from one place to the other. What distinguishes a courier service from a mail service is its speed, smooth delivery, security, personalization of services, security, tracking, and specialization.
Courier businesses operate on different levels from local delivery services such as bicycle couriers, motorbike couriers, van couriers to global courier services like DHL, FedEx, UPS, and USA Couriers.
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Are courier businesses profitable?
You generally don’t start a courier business for “the good of the community”, you want it to be profitable. Thanks to the increase in remote works, courier services are becoming high in demand.
The national average rate for courier services using a “light” vehicle, such as a car, pickup truck or minivan is around $36 per hour. If you work 8 hours a day, that’s $1440 per week and $72,000 yearly.
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How do you make money through a courier business?
The basic business model for a courier business is to receive payment for each item delivered. A good way to make money is to get businesses signed under your courier service.
This way they contact you any time they need items to be delivered.
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What Equipments do you need to start a Courier Business?
To start a successful courier business, there are some pieces of equipment you should have.
Dispatch Vehicle
To start up a career business, you will need a reliable means of transportation to move the goods from one place to another. If you plan to transport large and heavy goods, you will need a van or a truck but if you are transporting small personalized items you would need a cargo bike, tricycle, or a car.
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A Smartphone
A Smartphone is very important in running a courier business. You need it to make calls to your customers as well as use a GPS to locate them. Since most people have smartphones these days, this isn’t really a big problem.
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Dispatch box
If you are starting as a small courier business, you would need a dispatch box to make sure your items are safe. The size of the dispatch box varies from the type of goods you are delivering. Anything between 10kg and 25kg should work perfectly for small courier businesses.
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Sack truck/Furniture trolley
To ship in large quantities, you would probably need a sack truck or furniture trolley to help you move the goods out of the vehicle into the delivery destination.
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Ratchet Straps or Bungee cords
When transporting goods you want to make sure the items are secure. Imagine you are delivering a large number of mirrors, you don’t want them sliding sound or breaking. Ratchet straps or bungee cords can be useful to ensure items are secure during transit.
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How to Start a Successful Courier Business
To start a successful courier business there are some easy steps you must follow.
Get funding and register your business
If you have a dependable vehicle and cell phone you can start up a courier business with as low as $900. If you need to get vehicles, you can obtain a loan from a bank, a lending agency, or family and friends.
After getting funding, you will need to choose a business name and register your business. Check Nolo for expert information on the type of legal structure you should adopt for your courier business.
Find your niche
If you live in a metropolitan town with lots of courier businesses, picking a unique niche is an effective way to start.
It would help you find customers and cater to their specific needs. For instance, DoorDash focuses on food delivery and has a customer base of over 20 million.
Draw out a business plan
In starting up any type of business, a good business plan is very essential. You have to draw out a plan and set out attainable goals. To do this, you can hire a business consultant for expert advice or ask questions from people in the niche to set up a perfect business plan that caters to the needs of your business.
Place your Business Under an Insurance Plan
Your courier business would need insurance for vehicles, cargo in case of accidents.
To get insurance for your courier business, contact a local commercial broker to find out what plan works for you based on your equipment, deliveries, and perceived risk.
Find Customers
After you’ve set up your courier business and registered it, the next important step is to find customers. You could start with close family and friends who could also refer other people to your business. However, to have a large customer base, you would have to set up a solid marketing plan.
To do this, you should establish an online presence by creating a website, social media accounts, email newsletters, a personalized delivery app that would give your business visibility and enable customers to make calls to action.
Get Storage Space
To run a courier business you will need a storage space to store your deliverables. You can do this by renting a warehouse or tuning a personal space into a storage house. The most important thing is to make sure the place is secured to avoid losing customers’ items.
Invest in Hiring the right people
Hiring the right staff is very important in running any type of business. Invest in hiring the RIGHT people with the relevant skills, talents, and expertise, who understand what it means to put customers first. When you have reliable employees, it builds trust between customers and helps to grow your business.
Manage your Time properly
One of the major benefits of courier services is speedy delivery. Hence, you would have to learn how to manage your time properly to make customers keep coming back. To achieve this you would have to develop a schedule that works and invest in reliable vehicles. Ford Transit Connect is a good cargo van for courier services and it costs about $24,655.
Define your Business brand
Look for what sets your courier business plan from others in your vicinity and build on it. For example, ShipBob has been listed as one of the best courier services for small businesses because of its transparent pricing and its integration to E-commerce platforms like Walmart, eBay, Shopify, WooCommerce, Squarespace, Wix, and more.
Provide exceptional service
It’s no news that good customer service is very important to sustain any business. Imagine going to get a hamburger from a fast-food restaurant after a long day only for the girl at the counter to speak rudely to you.
There is a high probability that you won’t go back there and would rather look for another restaurant closeby. This also applies to your courier business. Once your staff treats your customers well your clientele would keep increasing.
Keep track of your business
New business owners usually get overwhelmed by their expenses and begin to have cash flow problems. To avoid this, you would need to create statements of accounts to monitor your transactions. You can employ professionals to do this or use an Accounting software like Quickbook to keep track of your transactions and book-keeping.
Conclusion
In summary, a courier business is a very good business because of remote works which have become the new normal. Although starting a courier business can sometimes prove difficult like any other business.
If you follow the right steps, you are on your way to having a successful courier business that would bring in profit daily.
References:
- Tasmin Lofthouse. What equipments do I need to start a courier business? Couriers.tv
- Gabrielle Pickard-Whitehead. 20 points checklist to start a courier business. Smallbiztrends.com
- William Barton. Can you make money being a courier? pioneerbd.com
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