How to Launch Your Own Courier Service

Editor's Note: Take a look at our featured best practice, Cost Segregation Study: Multiple Property Class Analysis (Excel workbook). Accountants, accounting firms, and real estate property owners can all benefit from this cost segregation study (CSS) template. It makes the estimated benefit easy to figure out and has flexible assumptions for high level or detailed segregation analysis. You get a summary of cost [read more]

* * * *

Data suggests there are almost 20,000 courier services operating in the UK, and that number is only likely to grow thanks to online shoppers ordering things to be delivered to their homes, expanding an industry already worth more than twenty billion pounds. Starting a courier service could be a great way to profit from this demand, and can be very lucrative when done the right way. Here’s an overview on how to launch your own courier service.

Create a Business Plan

Every courier business, or any type of business for that matter, needs a solid business plan.

Define your customers and the products they’ll want delivered. Determine your competitive pricing and profit margins after you total up your expenses. Verify that the prices you need to charge are competitive with everyone else in that niche.

Determine how you’ll market your service and what customers will consider the necessary level of service. For example, you should decide what type of materials you’ll pick up for delivery and the time frame. One-hour delivery and overnight delivery options require very different business processes.

The size of the items you are willing to accept determine the type of vehicle you’ll need to deliver them. For example, most oversized items can’t go with a bike courier.

In fact, the type of items you transport will affect almost every aspect of your business. Fragile goods like glass and sensitive temperature controlled medical goods can’t be thrown in the back of the average moving truck. There may be advanced, specialised training required to handle hazardous waste. This affects who you can hire and the rules and regulations you’ll have to follow. Confidential material delivery comes with its own set of expectations. These are all things you’ll have to consider before deciding what you will and won’t be delivering.

Determine How You’ll Make Deliveries

Delivery vehicles like trucks and vans can handle large or heavy loads. In this case, you need to decide whether to lease or buy a delivery vehicle. Fuel economy is almost as important as its condition and depreciation.

On the other hand, if you want to offer fast delivery of small packages and letters in an urban environment then you’re probably going to need bicycle couriers. One of the benefits is that they won’t have the same maintenance costs or vehicle taxes as trucks.

However, you should invest in suitable courier insurance no matter how you make your deliveries. Take a look at this website if you want to get multiple quotes for your courier business. Quotzone.co.uk aren’t owned by an insurance company, so you’ll get unbiased quotes. They offer insurance whether you’re making deliveries via bike, motorbike, car or van.

Organize Your Office

You’ll want to set up a dedicated office space to run your business, because you can’t afford to lose track of orders, deliveries and dispatches. Ask the local zoning office before you set up a home office, because not all jurisdictions allow you to run a business out of your home. If you can’t, then you’ll have to add office rent to the budget. GPS units are invaluable for delivery drivers, while radios are a good choice if you’re working with bike couriers. Any courier business requires computer software to track pickups, deliveries, customer invoices and revenue.

Market Your Business

Once you have everything in place to make deliveries, you can start marketing your business to the demographic you should have identified in your business plan. You may want to market the business via fliers, postcards, business directory listings, online ads, trade shows and networking events where potential clients congregate.

Start Hiring

You may do the first deliveries yourself. However, you’ll need employees if you want to manage your office and have others handle the growing volume of business. Run background checks before you hire anyone. Do thorough checks of someone’s driving record before you let them drive your vehicles. Verify that their car is reliable before you ask them to make deliveries in their own vehicle. Once you’ve done all this, put them to work.

Monitor Your Business

You estimated your business expenses when creating the business plan. Now you need to compare the actual expenses to projections. You may need to adjust prices to turn a profit. You might be able to develop a more refined pricing structure, charging more for faster delivery once you know your team is capable of it.

The average courier business is rather cheap to start, and it is possible to find a profitable niche to serve. However, it requires doing your homework before you start picking up parcels if you want to succeed.

Do You Want to Implement Business Best Practices?

You can download in-depth presentations on 100s of management topics from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.

For even more best practices available on Flevy, have a look at our top 100 lists:

• Top 100 in Strategy & Transformation
• Top 100 in Digital Transformation
• Top 100 in Operational Excellence
• Top 100 in Organization & Change
• Top 100 Management Consulting Frameworks

These best practices are of the same as those leveraged by top-tier management consulting firms, like McKinsey, BCG, Bain, and Accenture. Improve the growth and efficiency of your organization by utilizing these best practice frameworks, templates, and tools. Most were developed by seasoned executives and consultants with over 20+ years of experience.