start courier business

10 Best Practices to START A PROFITABLE COURIER BUSINESS

The gig economy has made the prospect of becoming your own boss as enticing as ever, but starting a courier business requires more than computer and typing skills. If you want to be financially independent and work your own hours as a courier, you’ll have to put in the work.

With record online sales and a strong economy, there may never be a better opportunity to start a profitable courier business. It’s a relatively low-cost business to start with a lot of growth potential.

While it’s never easy to start your own company, the process of becoming a business owner and hiring courier drivers can be simpler if you make smart choices and avoid common mistakes.

What is a courier business?

A courier business provides a premium service for its customers. It facilitates the transportation and shipping of packages and time-sensitive documents to their intended destinations.

A courier business could be an individual who owns a sole proprietorship, an LLC, or a corporation. The mission of such a business is to provide an all-inclusive service. That is to collect and deliver shipments in the shortest possible time frame.

There are courier businesses in every state in the United States and around the globe. Also, there are several types of courier services that businesses and individuals might use.

What services do courier businesses offer?

Courier businesses can specialize in location, speed of service or both.

Below is a list of the kinds of courier businesses you could start:

  • Local courier business: Local courier businesses concentrate on a specific city or metropolitan area. They are limited by one geographic area. Specializing in an area is a competitive edge because it allows them to provide fast and reliable service to local customers.
    • Bike or motorcycle courier service: One of the least expensive ways to start a courier business is to start with a bike or a motorcycle. Delivering on a bicycle is an environmentally-friendly way to move parcels and packages from vendor to customer. This is a great option for food delivery services.
  • Time-sensitive courier business: Some courier companies specialize in speedy delivery of parcels and packages. Specializing in speed can differentiate your courier company from the competition. Customers are willing to pay a premium to deliver their packages in a hurry. Business contracts and other legal documents frequently require fast transport. A time-sensitive courier business caters to customers in fields like financial services, real estate, law, and healthcare.
  • Global courier business: The emphasis is on reach with a global courier business. Transnational parcel deliveries rely on international customs requirements, airplane travel and shipping.

Do you need formal training to start a courier business?

You don’t need formal training to start a courier business. There are no licensing requirements specific to courier companies. However, there are requirements to start and run a business. Check with your state and local government to find out about the requirements to start a business in your area.

The following skills and experience could be helpful when starting a courier business:

  • Local knowledge – Familiarity with the geographic area is a definite plus when starting a new courier company.
  • Industry experience – If you have worked for a courier service company, you could build on your experience.
  • Detail-oriented – Attention to detail will help you run a highly efficient delivery company. Being detail-oriented will help you minimize costs, resulting in high profits.
  • Customer service skills – Strong interpersonal skills go a long way in this business.
  • Organization skills – To run a successful courier business, you need to be organized.
  • Good physical condition – You don’t have to be an Olympic-level athlete, but you need to be in decent shape to work in a courier business. Delivering packages requires strength and stamina.
  • Can-do attitude – Challenges can arise at any time in a courier business, and you need to be able to think on your feet to fix any problems.

Do you need a lot of money to start a courier company?

You may be able to start your courier business with as little as $10,000.

You don’t need a lot of money to start a courier business. In fact, you can start a courier company with a small investment provided you already own a reliable vehicle, and you can run your business from your home office.

Most likely, you already have a laptop and smartphone. However, you’ll also need to budget for insurance, licensing fees and the optional supplies that could help your business run without a glitch, such as a GPS unit. When you start your courier business, buy used equipment to save even more money.

How does a courier business make money?

You have several options to make money with your courier business.

Choose from one or a combination of the possible business models for your courier business below:

  • Peer-to-peer courier service – Peer-to-peer parcel delivery is an exciting new trend. You could build your business on a peer-to-peer delivery network. You could start this business as a side hustle.
  • Business to consumer deliveries – With an ever-growing number of people working from home the outlook for business to consumer delivery businesses is great.
  • Business to business courier service – You can build your courier business on products shipped from one business to another. Orders are generally larger than business-to-consumer orders. And they are often scheduled in advance.

Advice on how to start a courier business

A courier business can be a lucrative venture with low overheads. Still, knowing where to start can be tricky, but our 6 step guide should put you on the track to success in no time.

How do I start a courier business?

Choose the right vehicle for your courier business

Every courier service worth its salt needs a reliable source of transportation to deliver packages. Otherwise, you won’t be able to deliver packages on time and intact. Most full-time couriers drive cargo vans as they provide ample amount of cargo space, minimizing reloading amount and maximizing time.

Before you buy a cargo van, be sure to read plenty of customer reviews. It might be cheaper to lease a cargo van instead of buying one. Leases normally have lower payments than if you buy a cargo van. The least expensive option is to buy a used cargo van for your courier business.

Alternatively, you could buy a fleet of pickup trucks. You can choose to cover your truck box, but if you leave it open, you can deliver large items, like mattresses, if they’re protected and secure.

Buy the right equipment for your courier business

Most of your employees will be strong enough to deliver small packages, but if you’re transporting awkward boxes or heavy loads, you’ll need equipment. Not all courier equipment is created equal. The right equipment will make your employees more productive. It’ll save your back from the pain of carrying boxes and make your courier company more efficient.

For boxes or parcels, a hand truck or a simple dolly is going to work well. It’s better to buy dollies and hand trucks right off the hop to save your couriers from back pain or prolonged fatigue. You can buy an inexpensive dolly at major retailers. But, if you want your equipment to last, I recommend you buy a dolly professional movers use. It may cost more money, but it will last longer.

Don’t forget to buy courier management software and GPS tracking. With these systems, you and your customers will benefit from fast delivery and an up-to-date tracking number.

Name your courier business

Naming your courier business is one of the most important steps when you start a business. The name of your business will play a large role in your success. A great business name can help your business stand out from the competition. But the wrong name can set your courier business back.

There is no doubt that the right name can make all the difference in propelling a business to success.

Selecting the name of your courier business is no small job. You could spend a lot of time choosing the wrong name.

Before you can think about products, prices, or promotions, you must take time to find the perfect name for your new courier company.

Steps to naming your courier business

Now you know why a good business name is critical for your courier business. Next, it’s time to work on finding the right name.

Here is how to come up with a catchy name for your courier business:

  • Brainstorm business names – Start with a braindump on a piece of paper. Play with related words and synonyms. Find as many word associations as you can.
  • Make a list of potential names – At this point, you should have no fewer than five names on your list.
  • Evaluate the business names – Which name is the easiest to remember? Which name is easier to spell? Is anything about the name confusing?
  • Check if the domain name is available –  It’s best when your domain name matches the name of your courier business. Once you have made sure the domain is available, buy your domain name and register social media slugs to stay consistent across platforms.
  • Search federal trademark records – Before deciding on a name, check with the secretary of state to make sure your business name isn’t taken. If you skip this step, you could select a business name that someone else has already trademarked. Using the trademark of another business could result in expensive lawsuits.
  • Register your business name – If you want to trademark your business name, you must file an application with the United States Patent and Trademark Office.

Brand your courier business

Branding is essential for all businesses as it tells others what you value. After becoming a sole proprietorship or LLC, you can start focusing on the small details. Think about which colors, fonts, images, and slogans you want to use to represent your brand.

How to build a brand for your courier business?

  • Identify your target customer – Interview potential customers for your courier business. Find out what customers think of the competition.
  • Research the competition – Analyse the competition. Study the marketing strategy of your competitors.
  • Write your positioning statement – For example, a positioning statement could be something like, “For attorneys looking for high-quality courier service, [name of your business] offers a wide range of delivery options – creating a positive experience for senders and receivers of parcels and packages. [name of your business] also fosters a diverse and inclusive culture.”
  • Create a business name that you can be proud of.
  • Write a catchy slogan for your courier business.
  • Select colors you want to use for your brand design.
  • Choose fonts to use on your website, business cards, and other marketing materials.
  • Design a unique logo that’s identifiable and scalable. The font should be readable even when small.

Get insurance for your courier company

Get business insurance as soon as possible. Some banks or insurance companies will offer a full package plan that’s specific to your industry, but you may need to mix and match depending on your needs. Search for deals on vehicle and cargo insurance, as you’ll definitely need these.

If you don’t apply for insurance fast enough, you’ll soon notice that other companies won’t work for you. That’s because you’re considered a liability risk or a customer relations nightmare. Also, insurance provides added credibility for your courier business.

Contact several insurance brokers, no fewer than three, to find out how much it will cost to insure your business. The cost of insurance varies by risk, business location, and the types of deliveries you make.

Market your courier business

Now that you purchased or leased your vehicle, bought equipment, and registered a name for your courier company, it’s time to get some clients.

Without marketing, how will others know about your company? Start your marketing journey by asking your friends and family to share your courier service on social media like Twitter, Linkedin, Facebook, and Instagram. Make a business page specifically for this purpose.

Many courier businesses sign agreements with other businesses looking for a courier service provider. You can call or email companies to prospect for new customers. If you want to work with some local businesses, you could visit them to meet or drop off information about your courier business.

Online marketing and advertising is an effective, low-cost way to target business owners. Place marketing material on your delivery vehicles, so everyone can see you’re looking for employees.

Save All Receipts

Self-employed individuals are responsible for tracking their expenses. Set up a separate business checking account to keep your personal purchases separate if you haven’t already. This will make tax time much easier as you won’t have to sift through one account yearly.

Keep your receipts, even ones you think won’t be used as a tax write-off, because you never know. Track miles you drive with a tracking app, as they can be written off in some cases.

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George Meszaros is the editor and co-founder of Success Harbor where entrepreneurs learn about building successful companies. Success Harbor is dedicated to document the entrepreneurial journey through interviews, original research, and unique content. George Meszaros is also co-founder of Webene, a web design and digital marketing agency.