The courier world has expanded far wider, and far quicker, than was once though possible; even with a rich history of international commerce, there was no predicting the specific ways in which a technological revolution would significantly and alter the world of commerce – with profound knock-on impacts for a delicate fulfilment and delivery ecosystem.
Between the rise and rise of the gig economy and
the runaway success of e-commerce, courier businesses have found themselves in higher demand than ever before. As larger-scale private delivery businesses continue to fall short of customer and regulatory demands alike, smaller independent businesses are able to carve out their own space in a new industry frontier. But as a courier business, when is the right time to expand – and how can temporary spikes in demand be effectively managed?
When to Expand
Courier businesses are, in a broad sense,
making hay as demand for haulage and delivery continues to increase alongside growing e-commerce opportunities. But as a courier business, even with a great deal of growth potential, it can be difficult to properly read the signs.
Long-term investment in expansion cannot be conducted as a result of temporary spikes in demand – which are many, and which also present ideal opportunities to increase capital precisely for growth investment. Holiday seasons, annual shopping events like Black Friday, and co-incident events such as Fresher’s Week for incoming undergraduate students are all events that can push the headroom of existing courier networks.
The Benefits of Temporary Expansion
For such temporary spikes in demand, rather than overstretching the finances of a young and potential febrile company in purchasing new vehicles, hiring a fleet temporarily may make more sense. Though there is no direct investment into an asset, hiring protects a smaller business from the impacts of sudden market downturn, and removes a large amount of financial responsibility regarding maintenance and depreciation in the process.
Logistical Considerations
Of course, hiring a fleet does not completely eliminate costs and logistical administration. For one, drivers – whether new hires or old hands – will need insuring with these hire vehicles,
necessitating investment in temporary car insurance to render operator and vehicle together road legal. Depending on the nature of the insurance agreement, this might also necessitate a new process for assigning vehicles and staffing rotas.
Best Practice for Implementing Temporary Vehicle Additions
As for how exactly to manage the hiring of temporary fleet vehicles, the specifics will differ wildly according to the size, needs and demand of each individual business. Larger fulfilment businesses looking to win major ecommerce contracts will need larger vehicles, and more of them; smaller, regional businesses will only need a small uplift in available vehicles to soak up additional work. Eventually, these small short-term savings will contribute all the greater to long-term investment in actual, equitable fleet expansion.
