Introduction
In the last few years, delivery platforms have become an integral part of our lives. From groceries to medicines, from takeout food to entertainment, everything is delivered online.
This makes a lot of sense, especially in the times we are living in. The COVID-19 Pandemic is very much a part of our lives. Staying indoors, avoiding public places, and taking precautions mean ordering online from the comfort and safety of your home is the best approach.
All these have given heightened importance to delivery businesses. For many working professionals, who have always dreamt of becoming an entrepreneur, starting a delivery business sure looks like a great idea.
Whether you want to start with one vehicle or ten, do last-mile delivery or cargo logistics, there is a growing and demanding market for the same. In this article, we are going to look at how aspiring entrepreneurs can start their own small delivery businesses.
How much does it cost to start a small delivery business?
As we have already mentioned, you do not have to break the bank to start your small delivery business. However, in terms of planning for finances, the following areas should be factored in-
i. Cost of the transportation vehicles (outright purchase or leasing)
ii. Fuel charges, maintenance, and service costs of the vehicles
iii. Insurance of the vehicles along with that of the employees
iv. Wages and salaries of the employees of your business
v. Technology and software fees (accounting, tracking, delivery, etc.)
vi. Phone and Internet Charges that the business will incur
vii. Physical location’s (office) rents, taxes, and overheads
viii. Expenditure incurred from marketing and advertising
ix. Parking tickets, permit and license renewal costs
x. Emergency costs and expenditures
The above ten costs need to be factored in when you are thinking about starting a delivery business. Yes, you can remove some from the list, like not having to pay if you do not have a physical office, but the others will stay and increase or reduce depending upon the scale you want to take the business to.
List of 5 important areas your small business delivery needs to focus on
1. The Transportation/Delivery Fleet of Vehicles-
The success or failure of your small delivery business is dependent on the transportation fleet you have at your disposal. By working with a credible car dealership like ABWIN, you can reduce your leasing costs, get excellent service freebies and financing options. You are also going to get tight vehicles that have been tested, refurbished, and serviced for the long haul.
2. The Type of Delivery Option you want to go for-
With a market that is expected to reach $10 Billion, there are plenty of options when it comes to the models of delivery. You can opt for C2C deliveries (eBay, Craigslist, or FB Marketplace), B2B deliveries, or even B2C deliveries. It should be noted that small delivery businesses should aim for primarily last-mile deliveries to cut their costs and expenditures.
3. Creating a Business Plan as a course-of-action-
Every business no matter how big or small it is should have a business plan. This should include the costs that you are investing in, strategies for growth, and challenges that your business will likely face in the future. The more robust a business plan, the better it will help in giving direction to your small delivery business. This is something all businesses should do.
4. Depend on Referrals and Word-Of-Mouth Marketing-
Small businesses can look to invest in some amount of digital marketing. However, beyond it, performance marketing can get difficult. This is why for small delivery businesses, referrals and word-of-mouth marketing is the best approach. This can obviously happen if the business is maintaining a very high standard of service and quality levels.
5. Paying attention to Legal Issues, Taxes, and Registrations-
Small business owners tend to get lackadaisical when it comes to legalities around the business. This is one major reason where they invite trouble for the business. Paying attention to the driving license of drivers, insurance of the vehicles along ensuring that all the permits and compliances are in place is very important for small delivery businesses.
The Bottom Line
If you have been sitting on the sidelines and hoping for the best time to start a delivery business, this is it. With double-digit growths expected to power the industry in the coming years, you can rest assured that your delivery business has immense potential to grow. All you need is the right plan, maintenance of quality, and excellent service records.
If you have any other questions you would like us to ask or have doubts on any of the points in the article, let us know in the comments below.
