How to Start a Shipping Business? 12 Tips for Company to Win

Online shopping has grown tremendously in recent years. The train was already in motion for quite a while. However, the COVID-19 pandemic served as an incredible accelerator for the industry.

Moreover, with the development of technology, the sky is the limit for online shopping. Online retail sales are expected to hit over $1 trillion this year for the first time. Rosy predictions before the pandemic had expected to reach this number by 2025.

This is not happening only in the United States, it is a worldwide phenomenon, according to recent data.

For business-savvy people, this interesting evolution opens the door to a wide range of possibilities. In that sense, one particular sector is showing a lot of promises — packing and shipping.

The packing and shipping industry is booming because online shopping has never been so simple. A phone is enough to order any item online and get it delivered to the front door in a relatively quick fashion.

Since there is more demand for order fulfillment, the market has opportunities for both large and independent structures. That is why a growing number of people want to know how to start a shipping company.

The following tips can help guide you and show you how to start a shipping business in a way that is relatable.

How to Start a Pack and Ship Business in 12 Simple Steps

Suppose you are looking for ways to join an emerging industry where you can make a considerable profit without investing too much. Starting a pack-and-ship business is the way to go.

1. Study the Packing and Shipping Market

Before you jump into this new venture, it is important to know more about the market. It is okay to take the time to become more familiar with the sector.

Additionally, it would be best if you had an idea about your future customers. And, It would be useful to do some research on the demographics and competition in the area.

This means putting the focus on companies doing the same thing as you do or the retail giants who also offer packing and shipping services.

2. Pick the Right Business Name

Before you can really find out how to start shipping products, you need an excellent name for the business. In this day and age, branding is very important and is a crucial step in starting a new business venture.

So, it is necessary to devote some time to finding the right name. You need to pick something that is easy to remember and marketable. It also needs to be available as a trademark and domain name.

3. Have a Solid Plan

You have a great and unique name, and you did your research. It is time for a solid business plan. Whether you are going independent or buying a franchise, the plan will help keep everything on track.

This should be as comprehensive as possible. From management to finance, you need to know where exactly you are going as a business.

It has to be easy to read since, especially things like startup costs; you will probably present it to different people.

4. Form a Legal Entity

Since you are ready to start your packing and shipping business, you need to get in touch with local and federal authorities to register the business. There are different options here.

There are five possible legal structures: sole proprietorship, limited liability company, partnership, C corporation, and S corporation.

The sole proprietorship is easy and simple to set up because the owner and the legal entity are just one person. This entity also requires less paperwork and can be ready to go faster than the others.

5. Find the Right Source of Financing

The sources of funding are included in the business plan. The financing can come from different places. The first area to look is into your personal savings. It is also possible to reach out to family and friends.

In the era of social media, crowdfunding is an option that is worth exploring. Bank loans, credit card financing, and angel investors are traditional ways to get a business ready to go.

6. Pick a Location

If you want your business to be in a position to succeed, you need to pay attention to the location. This is an aspect of the project that should never be neglected.

Ideally, you want your company to be in an area that is vibrant and flourishing with other businesses. However, it is best to avoid being too close to another company in the same field.

Shopping centers, colleges, and universities are places that may need your services. Doing some deep research in your chosen locality could deliver decent margins.

7. Register with the IRS

This is another crucial step. By registering your packing and shipping business with the Internal Revenue Service (IRS), you will be able to obtain an Employer Identification Number (EIN).

Thanks to this number, it will be easier to open a bank account and hire people. Sole proprietors do not have to obtain an EIN. They can use their Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN).

You can do some of these things on your own or get extra help from an expert like an accountant to put the right system in place for you.

8. Open a Bank Account

You can choose between a checking or saving account. However, if you can handle it, a business credit card can improve your general standing.

It needs to be said that interest rates might be pretty high, just like annual fees. However, thanks to a card like this, you can make larger purchases and build a credit history for your business.

To start this part of the journey, just get in touch with the bank of your choosing. There will be some forms, and you will have to share your personal information.

Furthermore, you will have to tell the bank a little bit more about your business.

9. Obtain the Permits and Licenses for Your Pack-and-Ship Business

To start shipping products, your city requires you to get a business license. There is also the retail sales license, which is a must at the local level.

You will need a license to operate a commercial vehicle and another one to transport goods.

Depending on where your business is located, additional licenses might be necessary. By contacting your local authorities, you will have a clearer picture of all the permits that you need to obtain for your business to be right with the law.

10. Get Insurance for Your Business

This is a step that should not be overlooked. It is, first and foremost, about protecting your investment and your dream. There are many options to look at. It will all depend on the kind of business that you are running.

Working with a professional could help make the right call about what is really necessary in your specific case.

Things you can look at; auto insurance, business interruption insurance, commercial property insurance, general liability insurance, professional liability insurance, and workers’ compensation insurance.

11. Choose the Right Equipment for Your Company

Getting the proper equipment will contribute greatly to the success of your business. And then, you will have to decide if you want to buy or just lease the different items.

The list includes a computer, printer, scanner for the different labels, and a credit card reader. Moreover, boxes, labels, and tapes are also needed.

12. Focus on the Online Presence of Your Company

After taking care of the previous issues, it is time to work on online presence for your business. So, this is a step that can help your business grow.

Start with a professional website and a logo that stands out. And then, you move to the social media accounts to increase visibility.

To get to the next level, you can purchase software to help you and your clients track packages and be able to print labels.

All of this is part of creating a real identity for your business.

Bottom line

In short, if you follow these different steps, you will remove a lot of pressure about how to start a shipping company.

Now that you are ready for a big launch, it is time to start reaching out to the local community via newspapers and the chamber of commerce.

mm
Paul Fisher
Freelance writer with a passion for internet marketing and learning. I am happy to embrace the freedom of writing for online publications.

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