If you’re interested in learning how to start a courier business, it’s likely you’ve seen companies who deliver packages to others, and you’re thinking this is something you might be able to do. Like many startup entrepreneurs, you might be concerned about the process of starting the business. You might be concerned about:
- Whether this business will be enjoyable for you
- Whether you can make good money in it
- How much time it will take
- What’s a typical day like
- Whether you’ll be able to run this business and check off other things from your “bucket list”
- How you can monetize the business
- and, how you’ll get other people to know about your business
In this article, we’ll be discussing all of these things to help you decide if this is a good fit for you, and if it is, how you can begin taking action today. If that sounds interesting to you, let’s get started…If you’d like to see this content in video format, check it out here:
- 1 What is a Courier Business? An Overview
- 2 Who is a Courier Business right for?
- 3 What’s a typical day in a Courier Business like?
- 4 Who is the target market for a Courier Business?
- 5 How does a Courier Business make money?
- 6 What is the growth potential in a Courier Business?
- 7 What are the skills you’ll need to make a Courier Business work?
- 8 What are the costs involved with a Courier Business?
- 9 What are the steps involved in starting a Courier Business?
- 10 Ready to Start Your Courier Business?
What is a Courier Business? An Overview
A courier business is an independently owned company that gets paid to deliver packages, messages, and letters from one place to another. There are several large companies who offer courier services such as:
- and United States Postal Service
But, even with the existing services, there’s still room for small businesses to serve the growing demand for delivery of various goods and services including:
- Medical labs
- Important documents
- and more…
Small businesses can create a unique selling proposition that the larger companies with established brands and customer expectations don’t have the flexibility to move into.
Who is a Courier Business right for?
The courier business is good for:
- A person who has a passion to deliver packages to others in a quality and trustworthy way
- Someone who enjoys managing drivers or driving themselves
- A person who is willing to master the package delivery and management skills, and who is also willing to learn networking, sales, communication, management, leadership, basic finance, and basic leadership (until components are hired out)
- Those who understands logistics and inventory management to ensure packages are delivered to the correct people at the right place
- Someone who may need to lift heavy items or be sensitive of perishable items
- Those who are willing to follow safety and sensitive information guidelines
- Those who are willing to learn or manage the use of hand tools, lifting equipment, and loading equipment
A typical day in a courier business will vary. If you find a balance where there is a reasonable demand and a low supply, you can expect to have a consistent amount of work to do. In order to build a successful courier business, you’ll need to divide your time between four areas: acquiring the work, doing the work, managing the work, and strategizing about the work.
Here’s how that would break down…
Acquiring the work: A business isn’t going to make money without customers, right? Hahahaha. As the entrepreneur, you’d need to begin letting people know your business exists and finding people who need the service. You could use “old school methods” like passing out flyers, giving out your business cards, networking with your target audience, and I highly recommend you do that.
I also recommend in addition to the “old school methods” that you also add on modern marketing methods because times are changing for businesses. More people are looking for products and services online. As a result, I would advise you to also create a website, get listed on Google maps, set up social media pages, and begin posting content that you’re customers would be likely to look for online.
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Doing the work: Once you start getting attention and paying customers, you’ll have to provide a quality service to them–that’s where doing the work comes in. Often times, entrepreneurs get too focused on one component: either acquiring the work, doing the work, managing the work, or strategizing the work, but it’s really important you juggle them all.
When you’re doing the work, you’re picking up packages, recording them in your inventory management software, delivering them, and communicating with customers to make sure they know when their packages are expected to arrive.
Managing the work: Depending on your startup budget and your connections, you may or may not start out with help. Even if you don’t start out with help, it’s still important to prepare for the growth of your company by still slotting in this time for management.
Before you have employees or contracted help, you can use this time to coordinate supplies with vendors, organize the packages and the inventory management system, and to create training for when you do hire.
Strategizing about the work: Small companies can’t become large without a good strategy. As a result, you have to take time to look at your plan, set goals, compare your plans with your actual results, and continue finding growth opportunities.
The target market for a courier business is split into three categories: government, other businesses (B2B), and direct to consumer.
I’m not certain of how other countries and governments works, but the US government is who I can speak on. The US government has thousands of agencies, and each one is mandated to hire some of their work out to small businesses. They do this because they know small businesses stimulate the economy and give jobs. Some agencies have mandates higher than 40%, which means a courier business could bid on a government contract to deliver packages, and win because of their reputation and their status as a small business.
Other Businesses or B2B
In addition to the potential for a courier business with the government, there are also businesses that need your services. There are places like:
- Law firms who need documents delivered, signed, and returned quickly
- Medical practices who need labwork transported and results returned in a timely way
- Flower shops, cake shops, and restaurants who need gifts and special occasion deliveries
- Businesses who need their mail or other items delivered routinely
- Daycares who need groceries routinely
In his post How to Find the Right Customers for Your Courier Business, Craig Wallin highlights how a few businesses who need you to provide routine deliveries can really add stability in your company. You could have a few medical practices that need labs transported 3-5 times weekly, a few law firms who need documents transported weekly, some businesses who need their P.O. boxes checked weekly, and a few restaurants to send ready-made food to other businesses, and the consistency can enable you to scale and grow your company in a predictable way.
Direct to Consumer or B2C
By now, your business is starting to look very solid. You could have a few government contracts, some B2B contracts, and some consumers who need your help as well. People who pay courier services include:
- Senior citizens that are no longer able to drive or uncomfortable transporting their own goods
- Those who have medical conditions stopping them from delivering their own goods
- People who are busy and simply want to focus on other tasks
- Those with responsibilities (like having dependents) that makes it difficult for them to travel and transport goods for themselves
- Animal lovers who may want transportation for their animals
When you’re looking for government, B2B, or B2C opportunities in your courier business, you have to make sure you target people who can afford your service. Targeting the wrong people can leave you scraping by or completely bankrupt, do be careful to choose areas and people with sufficient income to afford your courier services.
I recommend multiple streams of income for EVERY business. Courier services are no different. You may want to start out focusing on building one stream of income, then adding others, but either way, multiple streams of income in your courier business will help you to weather different things that come up in business finance from time-to-time. Here are some ways you can make money with a courier business.
Products: When you look at successful courier businesses, you’ll notice they also sell products. Products like packaging, tape, and other things to help your customers deliver their products and services to their destinations safely.
Since you’re the professional, you may notice packages that aren’t packaged well, and you can recommend alternative packaging, tape, or other things that can be very helpful for them. Similar to USPS, UPS, or Fedex, you can sell packaging with your brand a logo on it, so it serves as a benefit to your customer and advertising for you at the same time!
You can get packaging similar to UPS and Fedex made with your brand and logo at Deluxe here, and earn one stream of revenue from products. You could also sell products on your website that are relevant to your customers: digital products and physical products.
Services: In addition to the products, you could also make several streams of income from services. We discussed how you could have contracts with the government, B2B contracts, and direct to consumer deliveries. You could offer same-day delivery services, next-day delivery services, and more niche delivery options that big companies can’t offer.
Events: Events are a little less common in this industry, but in other industries, events are used to educate the target audience, to boost morale, or to gather industry professionals. You could use events to show appreciation to customers and employees, to share ideas with others in the courier business on what’s working and what’s not, and to educate those you do business with about how they can get better results with delivering goods. Events is a stream of income I don’t see many couriers tapping into, but it’s definitely something you could consider in the long run.
Affiliate partnerships: Affiliate partnerships could be another huge source of revenue! Let’s say for example, your courier service uses vans or smaller vehicles because the majority of your deliveries don’t require large vehicles. What happens if a customer with a larger delivery comes to you for services? Do you simply turn them away?
You wouldn’t have to if you create affiliate partnerships with complimentary companies. Interestingly, many companies have affiliate programs where you can get a website link or referral code and get paid a commission for each referral.
Many companies who aren’t aware of the new technology that makes it easier to track customer referrals are willing to learn how to implement this because it’s free marketing and they only have to pay in exchange for a conversion metric they set: most likely either a lead or a sale.
As a result of affiliate partnerships, you could get paid commissions for referring people to complimentary services like:
- Moving companies
- Vehicle rental companies
- Packaging companies
- Or, even complimentary courier services
Here’s a glimpse of some companies that have programs like this…
Affiliate partnerships could be a very lucrative source of income for you. To learn more about affiliate marketing, check out my #1 recommended affiliate marketing training here.
What is the growth potential in a Courier Business?
Businesses who are offering ease of delivery are seeing exponential growth right now. Look at companies like Amazon, Lyft, and Uber who are offering to make delivery more convenient. They are growing crazy fast!
As a result of the growth of these huge conglomerates, you might be concerned about the growth potential for you, but you shouldn’t be. The courier services industry is nearly a $300 billion dollar industry, and with the growth of online sales, the demand is expecting to grow. Added to the growth resulting from the internet, there are many specialties that need delivery services that are untapped by the large courier conglomerates, and when you have a unique selling proposition, you can find yourself a lucrative niche within it all.
What are the skills you’ll need to make a Courier Business work?
- Inventory management
- The ability to use lifting equipment (and heavy loading equipment in some instances)
- The ability to drive
- The ability to price
- Financial management
- Risk management
- Logistics management
- The ability to connect with others
- Good work ethic
Many people will tell you to create a business plan and use that to go get a loan of tens of thousands of dollars, then set the business up–that’s not the advice I give here. In most instances, I believe it’s best to start with the minimum viable funnel. This means rather than investing lots of money on your products and services up front, you spend just enough to get sales rolling in, then you reinvest from your sales and continue improving.
As a result, you’ll have much lower overhead costs starting out. These are the main things I’d recommend you purchase:
- The tools you need to move the packages (example: dolly, cart, lift, vehicle, bike, etc.) – $0-$5000 (it’s going to be on the higher end if you don’t have transportation)
- A DIY website – $0-$400
- Business cards and brochures – $25
- Transportation maintenance (cleaning, oil changes, tires, etc.) – $100/mo
- Gas (if you’re delivering with a motor vehicle) – $100/mo
- Packaging – $100-$200
- Education – $100-$200
- Scales to measure the weight of the packages – $100-$200
- Apps to measure your mileage – $0
- Apps to measure your time – $0
- Forms like invoices, receipts, and delivery reciepts – $100
Starting out will be on the high end if you don’t have a source of transportation, however, if you do, you could expect to spend about $1000, then you can start getting sales coming in and reinvest from that. Some things you’ll probably want to reinvest into are:
- Professional Associations
- More education
- and overall improving your services
What are the steps involved in starting a Courier Business?
We recommend you set up your Minimum Viable Business first, then once you’ve got sales and confidence you can do this, then you get into the other steps like legal and accounting later. The steps to create a minimum viable business consists of:
1. Validate your Idea
Most people start out in business not so much worried about whether the business can work, but can the business for “FOR ME”–that’s why I recommend the low-cost startup. When you test drive the startup with $1000, then you can do the business and see if you like how it feels in practice. A plan and practice is two different things!
Once you know there’s a demand, you have a plan, and you feel confident it can work for YOU, then it’s time to make it a priority. You might be used to working overtime on a job, taking care of dependents (dogs, cats, kids, parents, nephews, neices, or cousins), volunteering alot, or dedicating your time to other things. When you decide to start a business, you’ll need time to invest, and you’ll need to prioritize in order to find the time. Instead of watching Netflix every evening (hahaha), you may have to focus more attention on your courier business.
3. Build Your Brand
Your brand is others’ perceptions of your business. In the beginning, no one will have a perception of your business because they won’t know it exists! If you have a small social circle and budget, building brand awareness can be quite a challenge, but you can do it!
Some essentials that help with building brand awareness is representing yourself in a professional way, providing something for people to take a look at, and finding ways to build trust. Some things to consider as you’re building brand awareness is:
- Networking in the community with those who might need your services
- Getting business cards and brochures
- Wearing clothing with your logo
- Handing out or selling relevant and useful promo products (like I mentioned earlier)
- Creating your website
- Growing your presence online
4. Start Getting Leads and Traffic
Once you have your basic service set up and your branding, then it’s time to start getting your phone to ring, your email full, and people requesting your services on your website. To get this happening, you’ll have to network and find your ideal customer: online and offline.
In the online world, this could mean setting up your Google my Business listing, adding content on your website, doing market research to figure out what keywords your target audience uses online, and either creating content or setting up ads to attract your ideal customer to your site.
In the offline world, this could mean attending industry events where your target audience would be, physically going to local business owners, attending your local PTAC, and putting in bids with the local government, or going to senior homes and finding out where people are who need your services.
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Once you’re getting attention, it’s time to convert that attention into money. You’ll need to set your prices, get comfortable with accepting payment for your services, choose a payment processor, and accept payments. Once you’re getting traffic and converting the traffic into customers, you’ve proven your concept works FOR YOU, which is a huge confidence boost!
6. Form Your Business Legally
Once you’re getting more and more customers, you’re increasing your liability, and more income means more taxes if you’re not incorporated. Governments tend to tax individuals much higher than “businesses” because they appreciate the economic boost businesses offer.
When you incorporate, you can eliminate some of the legal risk your business would have and you can lower your tax bill at the same time! If you’re unsure of what business structure you should use, how to incorporate, or you just want to peace of mind that you’re business is incorporated right, I recommend going with a legal service like Swyft Filings. They’re reasonably priced and they’re legal professionals, so they’ll make sure your incorporation will be done efficiently and the right way.
7. Organize Your Books
Your finances will serve as a guide in your business. It tells you how much you’re helping others, how much you’re spending, and gives you good ideas about what you can do to improve your business IF you’re organizing them well. It’s best to use an accounting system that will easily give you reports like your profit and loss statement, and that helps with categorizing your expenses so tax time is easier. For the courier business, I’d recommend Quickbooks as the #1 option, but I’ve included Freshbooks here so you can decide for yourself. They both have free trials, so you can check out whichever looks more comfortable for you (or even both of them).
8. Get Your Office Supplies
In your courier business (or any business for that matter), you’ll need office supplies. You’ll be writing, doing paperwork, and communicating with vendors, employees, and other people. You’ll probably need things like pens, penciles, printers, tape, and other things just to make your operations easy for you.
- 23 Best Home Office Supplies Every Entrepreneur Needs
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8. Systemize Your Process
Once you’re offering a satisfying service, you want to make sure you’re able to deliver the same quality over and over again. When you can deliver the same quality to your vendors, customers, and employees, it builds a stronger reputation, and the company is able to contiually grow. In order to stabilize the consistent quality, you’ll have to put systems in place. You’ll learn all about systemizing your processes in my free Business Growth Framework e-course here.
9. Reinvest and Scale
Once you get all the way to this step and you have money and time beyond what you’re business is spending, don’t fall into the trap many entrepreneurs do! At this point, many entrepreneurs celebrate too hard by getting their dream house, their dream car, their dream food, and on and on.
Then, they extinguish the funds they’d need to grow the business, improve the services, and help more people. Be careful to reinvest in the business by:
- Hiring people
- Improving your skills
- Advertising and marketing more
- Improving the products and services
- Building up your working capital
- and, reward yourself a little too
Ready to Start Your Courier Business?
The goal of this article was to show you how to start a courier business. I’m hoping this article was thorough and answered many questions for you. I’d love to hear your questions and comments below.
If you’re looking for even more detail than what I’ve included in this post on how to grow your business, I explain all of these concepts in much more detail in my free Business Growth Blueprint E-course and my full video course on creating your full minimum viable business plan at Wealthy Affliate. You can get access to my e-course and all of my free bonuses by signing up here. You’ll also get 7 free days of coaching with me, 10 lessons of internet marketing training, and two free websites you can try out for free. Let’s get started building your Courier Business!