Courier Company business plan for starting your own business
As long as the earth is populated by humans, they will send and receive things and that means the courier business has a very low probability of going into loss. If you are going to start your own business, the first thing that you need is a bunch of courier business plans that can give you an idea of how the business works and what is needed to start it. This article will tell you in sheer detail how to write a courier business plan but first you need to know what is a courier service business. Once you know that, creating a franchise business plan will be child’s play for you.
2.1 The Business
Damian Courier Services (DCS) will be a registered courier services provider in Dallas, Texas. The business will cater to the needs of anyone who wants to send something on any point on the planet earth and if humanity expands to Mars, an express delivery service will be started for the red planet as well.
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2.2 Management of Courier Company
Management is the cornerstone of any courier services business plan as no business on earth (or Mars) can be successful without proper management. If you want to know how to start courier service, you need to have a proper management structure for the business in your mind even before you start it.
In this courier service business plan, the management will be headed by the owner of the business. They will hire to manage various aspects of the business. Management structure is also important for creating a business plan for a bank loan. This management structure will be closely related to the one we saw in business plan for a Mexican restaurant.
2.3 Customers of Courier Company
The next thing that we need to discuss are the customers that the business will be serving. It is important to know the customers as only then we can see how the business will be run. The main customers of the business will be the following:
- Privat customers who want to send letters.
- Businesses that want the service for their business.
- Ecommerce companies.
- Online stores.
2.4 Business Target
DCS is being started with the target of making life easier for the people of Dallas. It has been noted that the city lacks good courier service that are direly needed. The business aims to bridge the gap as best possible. The target will be broken down into the following:
- Establishing a credible and dependable brand.
- Providing best services in the sector.
- Maintaining 100% customer satisfaction.
- Charging better rates than any of the competitors.
3.1 Company Owner
The owner of this courier company business plan will be Damian Johansson. Damian has worked as a delivery boy for Pizza Hut for a long time and knows the method and importance of taking things from one place to the other.
3.2 Why the Courier Company is being started?
When Damian was asked why you are starting your own courier business, he said that he always wanted to employ someone as his delivery boy and treat them better than the way his employers treated him when he was in that place. Now, that there is a lot of potential in the business and he has the resources to pull this off, Damian is starting a courier business of his own, just because he can.
3.3 How the Courier Company will be started?
It might seem like starting courier service business is simple but it is not. You need to complete the courier franchise business plan before you can start the business and run it the right way. Here’s how this business will be started.
Step1: Market Need Analysis
The most important thing to do in order to start this business is to run a market need analysis to determine the magnitude of business that we will be handling. This is the most important step as all the next steps depend on this. Once the market need is analyzed the right way, you can move on to the next arrangements to make the business a reality.
Step2: Signing Contract with Bulk Carriers
As the courier services company is being started from a lower level, it will not have the infrastructure or resources to deliver the couriers to the world. For that, contracts will be signed with larger courier service providers to carry our mail.
Step3: Establishing the Outlet
Once the company signs the contract with bulk carriers, the next step will be to establish an office or outlet from where the business will be run. We will open an office in downtown where many of the ecommerce companies and businesses are located.
Step4: Online Presence
Most of the customers search for courier services online and that makes having a website and online presence immensely important for the business. We will make a website and will optimize it for search engines so that we can reach the most customers.
After completing all that, we will run a comprehensive marketing campaign to reach the customers and to make DCS known to the public of the area.
|Research and Development||$23,000|
|TOTAL START-UP EXPENSES||$380,000|
|Other Current Assets||$227,000|
|Start-up Expenses to Fund||$380,000|
|Start-up Assets to Fund||$1,234,000|
|TOTAL FUNDING REQUIRED||$1,614,000|
|Non-cash Assets from Start-up||$1,614,000|
|Cash Requirements from Start-up||$377,000|
|Additional Cash Raised||$50,000|
|Cash Balance on Starting Date||$35,000|
|Liabilities and Capital|
|Accounts Payable (Outstanding Bills)||$45,000|
|Other Current Liabilities (interest-free)||$0|
|Additional Investment Requirement||$0|
|TOTAL PLANNED INVESTMENT||$1,614,000|
|Loss at Start-up (Start-up Expenses)||$388,000|
|TOTAL CAPITAL AND LIABILITIES||$2,076,000|
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The next important thing in the courier company business plan pdf is the decision of the services that the company is going to provide. As there can be a lot of different services that a courier services company can offer, we need to narrow down the ones we will be focusing on before starting a courier business from home. This part of this business plan for a courier company gives you an idea of the services that you can provide. You can expand on this to add more services to your portfolio.
This service will be aimed at sending parcels and letters to any location in the USA.
All kinds of couriers will be sent to destinations across the globe under this service.
One-Day Global Delivery
This will be the flagship service of DCS, ensuring the delivery of any package up to 5kg anywhere in the world within 24 hours.
Cash on Delivery Service
For ecommerce service providers and online businesses, we will provide this service where they can send their products to customers, and we will collect the price.
Marketing Analysis of Courier Company
Great service. Good turnaround time and quality work.
If you are starting a courier service company, you need to run a complete marketing analysis of the business to make it successful. This is not a grocery store business plan and the factors at play here are far greater, often of global magnitude. If you want that your courier startup business is successful, it is important that you keep an eye on all the variables of the market.
5.1 Market Trends
Before opening a courier service, it is important to have a look at the market trends of the business you are about to enter. Just like the case with an airline business plan any person or company starting a courier business without having a look at the market trends of the industry fails miserably. The trend of courier business has gone down because of the widespread use of internet to send documents rather than mail.
5.2 Marketing Segmentation
Having an idea of the expected marketing segmentation is also one of the most important parts pf any sample business plan for a courier service. Here is the market segmentation that will be facing DCS:
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5.2.1 Private Customers
People who want to send letters and parcels will make a significant market segment for us.
5.2.2 Ecommerce Platforms
Ecommerce websites operating from Dallas will be a market segment. We will offer them national, global, and same-day services.
5.2.3 Business Customers
Businesses in the area that require to send/receive mail will also be a part of our market segments.
5.2.4 Online Stores
These will also be one of the largest market segments for the business.
|Potential Customers||Growth||Year 1||Year 2||Year 3||Year 4||Year 5||CAGR|
5.3 Business Target
- To establish a credible name in the courier industry.
- To improve the state of courier services in the area.
- To make as much money as possible.
- To expand to other cities.
5.4 Product Pricing
The services of DCS will be priced at the average of what other service providers charge in the area. We will charge the same but will offer better services to make as much profits as possible.
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If you want to start independent courier business, the first thing that you need to do is to make a marketing strategy for the business. No business on earth can be successful without one. If you want to know how to start your own courier service for food delivery, you need a food delivery service business plan. Once you have that, you can very easily start your own business and turn massive profits.
You need to run competitive analysis and make a strategy to make your subscription box business plan a success.
6.1 Competitive Analysis
- People are not happy at all with the courier services being provided in the area.
- The courier service providers in the area charge too much money and do not offer the services that are good enough for the cost they quote.
- Most people have to go to other cities to post their letters and parcels.
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6.2 Sales Strategy
- DCS will provide excellent courier services to all customers to make sure that everyone gets what they want.
- DCS will provide service to all areas of the world so that no one needs to go to any other service provider.
- DCS will offer discounts to bulk and repeat customers.
6.3 Sales Monthly
6.4 Sales Yearly
6.5 Sales Forecast
|Unit Sales||Year 1||Year 2||Year 3|
|One-Day Global Delivery||32,000||33,920||35,955|
|Cash on Delivery Service||50,000||53,000||56,180|
|TOTAL UNIT SALES||164,000||173,840||184,270|
|Unit Prices||Year 1||Year 2||Year 3|
|One-Day Global Delivery||$80.00||$92.80||$107.65|
|Cash on Delivery Service||$37.00||$42.92||$49.79|
|One-Day Global Delivery||$2,560,000.00||$3,147,776.00||$3,870,505.37|
|Cash on Delivery Service||$1,850,000.00||$2,274,760.00||$2,797,044.90|
|Direct Unit Costs||Year 1||Year 2||Year 3|
|One-Day Global Delivery||$78.00||$89.00||$103.00|
|Cash on Delivery Service||$35.00||$39.00||$45.00|
|Direct Cost of Sales|
|One-Day Global Delivery||$2,496,000.00||$3,018,880.00||$3,703,385.60|
|Cash on Delivery Service||$1,750,000.00||$2,067,000.00||$2,528,100.00|
|Subtotal Direct Cost of Sales||$8,078,000.00||$9,637,520.00||$11,811,283.20|
Second to last thing that is important in making any courier business ideas a reality is the plan of the staff needed to make it happen. If you take a closer look a the courier service business model, you can notice that this is more of a services business than a products one. Such businesses, naturally, tend to be more labor intensive and cannot be run with efficiency without adequate staff.
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7.1 Company Staff
The following people will be needed to run DCS:
- Damian Johansson will be the owner and CEO of the business.
- 3 managers for procurement, operations and marketing.
- 2 courier bookers.
- 3 Delivery drivers.
- 2 Office workers.
- 2 guards.
- 1 reception clerk.
- 1 Accountant.
7.2 Average Salary of Employees
|Year 1||Year 2||Year 3|
The best approach is to look for a courier business for sale. However, if you cannot find that or just want to start one from scratch, you need to have an idea of the finances that will be involved in starting the business. Just like an organic restaurant business plan, the business is not a very finance intensive one and you can start it with a little capital. Here is an idea of the finances that will be involved in starting the business:
- Money needed to make the office.
- The cost of computers and other equipment needed.
- The salary of employees.
- The cost of buying delivery vehicles.
- Bonds, securities, insurance, and registration costs.
8.1 Important Assumptions
|Year 1||Year 2||Year 3|
|Current Interest Rate||8.12%||8.15%||8.24%|
|Long-term Interest Rate||8.37%||8.46%||8.49%|
8.2 Break-even Analysis
|Monthly Units Break-even||5340|
|Monthly Revenue Break-even||$131,500|
|Average Per-Unit Revenue||$232.00|
|Average Per-Unit Variable Cost||$0.65|
|Estimated Monthly Fixed Cost||$163,400|
8.3 Projected Profit and Loss
|Pro Forma Profit And Loss|
|Year 1||Year 2||Year 3|
|Direct Cost of Sales||$8,078,000||$9,637,520||$11,811,283|
|TOTAL COST OF SALES||$8,078,000||$9,637,520||$11,811,283|
|Gross Margin %||3.37%||6.24%||6.55%|
|Sales and Marketing and Other Expenses||$137,000||$148,000||$156,000|
|Total Operating Expenses||$312,300||$337,900||$362,080|
|Profit Before Interest and Taxes||($30,300)||$304,036||$466,256|
8.3.1 Profit Monthly
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8.3.2 Profit Yearly
8.3.3 Gross Margin Monthly
8.3.4 Gross Margin Yearly
8.4 Projected Cash Flow
|Pro Forma Cash Flow|
|Cash Received||Year 1||Year 2||Year 3|
|Cash from Operations|
|Cash from Receivables||$14,000||$15,120||$16,330|
|SUBTOTAL CASH FROM OPERATIONS||$66,000||$71,940||$77,695|
|Additional Cash Received|
|Sales Tax, VAT, HST/GST Received||$0||$0||$0|
|New Current Borrowing||$0||$0||$0|
|New Other Liabilities (interest-free)||$0||$0||$0|
|New Long-term Liabilities||$0||$0||$0|
|Sales of Other Current Assets||$0||$0||$0|
|Sales of Long-term Assets||$0||$0||$0|
|New Investment Received||$0||$0||$0|
|SUBTOTAL CASH RECEIVED||$67,000||$72,000||$78,000|
|Expenditures||Year 1||Year 2||Year 3|
|Expenditures from Operations|
|SUBTOTAL SPENT ON OPERATIONS||$63,000||$66,000||$69,000|
|Additional Cash Spent|
|Sales Tax, VAT, HST/GST Paid Out||$0||$0||$0|
|Principal Repayment of Current Borrowing||$0||$0||$0|
|Other Liabilities Principal Repayment||$0||$0||$0|
|Long-term Liabilities Principal Repayment||$0||$0||$0|
|Purchase Other Current Assets||$0||$0||$0|
|Purchase Long-term Assets||$0||$0||$0|
|SUBTOTAL CASH SPENT||$63,000||$68,040||$73,483|
|Net Cash Flow||$19,000||$21,000||$22,000|
8.5 Projected Balance Sheet
|Pro Forma Balance Sheet|
|Assets||Year 1||Year 2||Year 3|
|Other Current Assets||$1,000||$1,000||$1,000|
|TOTAL CURRENT ASSETS||$287,000||$321,440||$361,299|
|TOTAL LONG-TERM ASSETS||$24,000||$26,880||$30,240|
|Liabilities and Capital||Year 4||Year 5||Year 6|
|Other Current Liabilities||$0||$0||$0|
|SUBTOTAL CURRENT LIABILITIES||$19,000||$21,280||$23,919|
|TOTAL LIABILITIES AND CAPITAL||$303,700||$328,160||$369,180|
8.6 Business Ratios
|Year 1||Year 2||Year 3||INDUSTRY PROFILE|
|Percent of Total Assets|
|Other Current Assets||2.12%||2.35%||2.60%||2.40%|
|Total Current Assets||149.00%||152.00%||152.00%||158.00%|
|Percent of Sales|
|Selling, General & Administrative Expenses||94.00%||96.54%||99.24%||97.80%|
|Profit Before Interest and Taxes||41.00%||42.11%||43.29%||33.90%|
|Total Debt to Total Assets||0.18%||0.18%||0.17%||0.40%|
|Pre-tax Return on Net Worth||74.00%||74.50%||75.00%||75.00%|
|Pre-tax Return on Assets||94.60%||99.33%||104.30%||111.30%|
|Additional Ratios||Year 1||Year 2||Year 3|
|Net Profit Margin||33.01%||34.03%||35.09%||N.A.|
|Return on Equity||56.00%||57.74%||59.53%||N.A.|
|Accounts Receivable Turnover||7.7||7.8||7.8||N.A.|
|Accounts Payable Turnover||15||16||16.3||N.A.|
|Total Asset Turnover||2.4||2.5||2.6||N.A.|
|Debt to Net Worth||-0.04||-0.03||-0.04||N.A.|
|Current Liab. to Liab.||1||1||1||N.A.|
|Net Working Capital||$239,000||$252,384||$266,518||N.A.|
|Assets to Sales||0.86||0.87||0.87||N.A.|
|Current Debt/Total Assets||1%||0%||0%||N.A.|
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