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Couriers are more relevant than ever, thanks to the growing demand to deliver products directly to customers’ front doors. A courier broker acts as an intermediary between businesses and the couriers they use, providing logistics and overall management to ensure that deliveries always arrive on schedule. To become a courier broker, you’ll need the skills and background necessary to run a business as well as the appropriate insurance and business licensing.
Becoming a Courier Broker
Although it can help to have a courier background, it isn’t essential. In fact, experience handling logistics for other industries could be even more valuable. If you worked for a freight transportation broker, for instance, you’ll have the essentials necessary to organize multiple deliveries at one time.
Delivery brokers work with businesses and the couriers who deliver goods for them. As a courier broker, you’ll be responsible for serving as the intermediary between these two groups, typically using logistics software to coordinate numerous deliveries at once. It can be a high-pressure job as you struggle to track down lost packages and identify couriers who aren’t honoring their promised delivery times.
Starting a Courier Broker Business
Since delivery brokers can work from anywhere, it’s a business you can easily start from home. However, you’ll still be required to have the appropriate licenses and insurance. You need to be aware of all the local laws regarding insurance for those using vehicles for business. In some states, for instance, all couriers will need to have commercial vehicle insurance if they’re using their automobiles for deliveries.
As a business owner, liability insurance is a must. This will help protect you if one of your couriers is injured on the job. Courier brokers should also look into becoming bonded, which protects the goods your couriers are delivering to customers in case something happens in transit. You’ll have to pay a percentage of the bond, so plan that as part of your courier brokerage fees, and you’ll likely be subjected to a credit and background check.
Building Your New Business
If you’re starting a courier brokerage, it’s important to know the limits under the law. There’s a line drawn between courier brokers, who typically service customers locally, and freight brokers, who manage shipments and deliveries of products on a larger scale. The requirements for being a freight broker are typically stricter, including the need for a license from the Federal Motor Carrier Safety Administration. If you act as a freight broker without the appropriate licensing, you could face a stiff fine for doing so.
Once you’ve decided to operate a courier brokerage, you’ll need to decide whether you plan to employ delivery brokers or farm out the work to independent contractors and courier businesses. Either way, you’ll need to line up business licenses, but you can save on equipment and supplies if your couriers will provide items like hand trucks and cargo straps.
Finding Couriers and Customers
Establishing your business legally is only the first step. You’ll have to work hard to market your new courier brokerage, so earmark some of your courier brokerage fees to set up a website and buy a stack of business cards to hand out. Join the local chamber of commerce and attend networking events that can help you connect with local businesses that might need couriers to get items to customers.
As a courier brokerage, one of your biggest challenges will be finding, retaining and managing your team of couriers. It’s also important to make sure your couriers are background tested and bonded in order to reduce your own liability. If you’re contracting with courier companies or independent couriers, it’s your responsibility to make sure they’re compliant with your policies on background checks and insurance.
Stephanie Faris is a novelist and business writer whose work has appeared on numerous small business blogs, including Zappos, GoDaddy, 99Designs, and the Intuit Small Business Blog. She worked for the State of Tennessee for 19 years, the latter six of which were spent as a supervisor. She has written about business for entrepreneurs and marketing firms since 2011.