Express Deliverables – Starting a Courier Services Company in India
3E Accounting details how starting a courier services company in India can be your express lane ticket to success.
The world today is considered a global village, where anything and everything is available at the click of a button. E-commerce has taken off in an unprecedented way, and the shift to online shopping has empowered supply chain management and logistics. India, the second-most populous country in the world, has a Global Courier Services Market that is expected to reach half a billion USD by 2025. Starting a courier services company in India is a prudent move for the discerning business person.
Packaged for Success
The Indian courier industry is considered a premium and significant segment of the logistics market. It is a bustling and active industry, with expected market growths of over 20% per annum.
There are two ways to go about starting a courier services company in India – registering your own business or getting a franchise from an established company. Both routes will require that you do your due diligence first. This includes research on potential clientele, delivery areas, competition as well as what type of courier business model you want. Funding is also vital as it is more capital intensive to start such a business in India than other countries.
Opting for a franchise may be a good option for first-time entrepreneurs. It has the distinct advantage of allowing you to learn first-hand about the industry without a lot of capital investment. Big-name courier companies such as DHL, FedEx, Blue Dart Express, all offer franchise opportunities. Another popular franchise is the Indian Speed Post Office Franchise Opportunity.
Becoming a franchisee will undoubtedly expose you to the ins and outs of the business. You will also be able to establish a name for yourself in the vast network that already exists in the courier industry. Whether you decide to get a franchise or start your own business, you will still need to incorporate your company.
Incorporation and registering a company is done with the Ministry of Corporate Affairs or MCA. The company’s legal structure includes:
- Private Limited Company
- Limited Liability Partnership
- Partnership Firm
- One Person Company
Upon receiving your Certificate of Incorporation, you can then apply for tax registrations such as VAT, GST and service tax. As your courier services company may need to handle international goods, an Importer-Exporter Code (IEC) is required. This is given by the Directorate General of Foreign Trade (DGFT). Check out their website for a list of goods that are prohibited or restricted in India.
Courier licenses are acquired from the relevant local municipal government office that your business operates from. If your business includes freight forwarding, then registration with the International Air Transport Association (IATA) and Air Cargo Association of India (ACAAI) is required.
Risk management is another crucial factor to consider. Courier service companies have high-risk factors as goods can get damaged, stolen, or lost, while employees can sustain an injury. You can lesson liability issues with proper business insurance.
You will also need to register for the Employee State Insurance or ESI. Consider getting inventory and office space as well as investing in reliable vehicles to get the job done. India is also very connected and having good website design and development is essential. Having an app that supports your business is also necessary as competition is high and people will tend to go for service providers with more complete business solutions.
Starting a courier services company in India may seem daunting and very process-driven. However, the business itself is hugely lucrative, and the potential for growth is very high. An elegant solution to this dilemma is to engage professionals such as 3E Accounting. 3E Accounting’s industry experts can handle all your business needs while you focus on running your business.
Contact 3E Accounting today to speak to our team of innovative and experienced business solutions experts.