Small delivery firm with contract drivers

Wholesalers, regional retailers, manufacturers and online sellers who need dependable multi-drop or scheduled deliveries.

Contract rates per route, drop or pallet, minus driver, fuel and vehicle costs. Margin comes from keeping vans full and routes efficient.

• Sales and relationship building
• Scheduling and route planning
• Managing and paying drivers
• Keeping accurate records

• Operator licence requirements depend on vehicle weight and the type of work, so check with the relevant authorities
• Employer's liability insurance if you employ staff, plus goods in transit and fleet insurance
• Check employment status carefully if using self-employed drivers, as getting it wrong can be costly
• Late payment from larger customers can cause cash flow problems
• Driver hours and vehicle maintenance records must be kept properly

Estimates suggest startup costs typically around £15,000 to £75,000, depending on how many vans you run and the insurance you need. Get quotes for fleet insurance, goods in transit cover and employer's liability if you employ staff.

Monthly revenue is typically estimated at around £5,000 to £25,000, depending on the contracts you win and how many vans and drivers you run. That is revenue, before driver pay and vehicle costs. Estimates assume at least 30 hours a week.

Check whether you need an operator licence, which depends on vehicle weight and type of work. Also check employment status for self-employed drivers, insurance including employer's liability, and the rules on driver hours and vehicle maintenance records.