Why Start a Delivery Company?
Whether you’re a new entrepreneur or an established business owner, a pickup and delivery service could be an option worth considering. Almost every person or business eventually needs something delivered. As we’ve seen throughout the pandemic, the pickup and delivery business sector has performed consistently well in 2020, and even more so today. According to Allied Market Research, the current global market size of all courier, parcel, and express services is $285 billion with a forecasted growth rate of 4.9% by 2027.
According to Forbes, in 2021, customers will order more delivery than ever before. Now that customers are comfortable with delivery, expect them to increase their frequency across industries.
In food delivery, this will lead to businesses optimized for delivery, like ghost kitchens. In other areas, too, retailers will adjust, leaning toward low-rent options such as micro-fulfillment centers that emphasize deliverability over the storefront.
Things to Consider Before Starting a Delivery Company
1. Customers want near-perfect execution
The delivery industry has developed a lot within the last few years, especially with some delivery companies offering services as fast as same day delivery. Customers now have higher expectations for delivery services and will be less patient overall.
2. A small business must optimize for last-mile logistics
If you’re not experienced or disciplined to optimize operations, it could be tough competing in this business. An operator can do almost everything right and yet can still experience unexpected issues, such as hot food delivered cold, payment errors, or an app directing a driver to a wrong address, etc. A delivery provider must be prepared for any given situation and should optimize for last-mile logistics.
3. Being careful with pandemic safety protocols
It is important to pay attention to safety practices as the pandemic continues. Be sure to stay updated on the latest news regarding restrictions and safety protocols. Safety practices can include barcode scanning and contactless delivery confirmations and payments.
Types of Delivery Services
There are 2 types of delivery services that you could consider for your business:
1. Business-to-Business Courier Services
Business customers can be a courier’s best client. It is typically easy to obtain a relationship with other businesses as a delivery service. The upside of delivering for other businesses is that the type of things they need delivered can vary, from small boxes full to truckloads to rolled-up blueprints and legal papers. For some of the lighter deliveries, such as paperwork and zip drives, you may not even need a vehicle. In some densely populated areas, such as urban Toronto or Montreal, addresses are close enough together to make bicycle couriers a viable, zero-gasoline option.
2. Customer-Facing Delivery Service
Customer-Facing refers to residential customers that require a delivery service. This option is much more difficult to pursue, as it can be difficult to find a residential customer that would be interested in using a dedicated delivery service. An example of a residential customer that would potentially be interested in a delivery service is a customer who runs a small business out of their home. These customers would be more open to using a delivery service.
The Steps to Starting a Delivery Company
1. Invest in the correct vehicle and equipment
To start a successful delivery business, it is important to have the right equipment. You have to have a reliable vehicle, cell phone and computer. Once you know what your products are for delivery, determine what vehicle is appropriate for those packages, whether you need a smaller vehicle like a van, SUV or a truck.
2. Obtain insurance and form a legal business entity
Just like any other business, you need to establish all the legalities and protect your business. Once your business type is established, you will need to insure it with commercial general liability and business auto coverage, which offer the following protections:
3. Budget for all licenses, permits, and expenses
Before your business can operate, be sure to consider all the licensing, permits and budget for your business expenses. This also includes registering your business for both state and federal taxes. Keep in mind while obtaining the right permits and licenses for commercial deliveries, that all these vary in cost so be sure to allocate your budget accordingly.
When budgeting, remember to consider recurring expenses as well, such as gas, vehicle maintenance, vehicle insurance, staff payroll, and health insurance. Other less obvious expenses might include GPS tracking software or ergonomic seat equipment for drivers.
4. Establish and implement your marketing plan
After establishing the legalities and base of your business, it’s time to start thinking about how to grow your business. This usually involves building a marketing plan that will help you advertise and expand your business to a wider customer base, gaining awareness. A good place to start is by thinking of who your target clients are. Are they local or within a certain mileage from your storage warehouse or offices? Does your customer base look for courier services online, in print, or both?
How to start a delivery company with ZeMaas
ZeMaas offers a variety of services bundled with our online ordering service. Our delivery and logistics services are a perfect fit for a delivery company that is just starting out.
The Maas Driver App will make it easy to upkeep the management of your drivers and orders going out, not having to worry about any external costs or issues. This is beneficial for a delivery service as you grow and gain more drivers, since it can be hard to keep track of every vehicle and every driver. Some of the features that Maas Maas Driver app includes:
Mass Pack is an app we provide as an add-on to connect end users and businesses. This app is designed to conveniently help with courier and delivery needs, picking up packages from wherever requested and dropping them off at the designated location. This will help with a delivery service as it works in conjunction with Maas Driver, and allows you to keep track of all deliveries and delivery items easily and efficiently.
It’s key features include:
Have your fleet of vehicles connected with our Maas Fleet platform for added revenue and greater exposure. Maas Fleet is a management solution for all the licensing, drivers, and vehicles. This is beneficial when your delivery service grows and gains a larger vehicle fleet, as you will be able to have access to the data of every vehicle in your fleet. This includes knowing where every vehicle is, what they’re doing, when they need inspections, licensing, insurance of each vehicle, etc. With Maas Fleet, you can also gain access to the following features, coupled with the Maas Driver and Maas Pack apps:
Launching a delivery company may seem daunting, but it is a strong business sector with many opportunities for growth. With our tips, and with the right tools, starting a delivery company may be easier.
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