Costs range from £20,000 to £50,000 for a regional, depot-based franchise and from £6,000 to £20,000 for a courier franchise.
The main factor in the price variation is the size of the territory you are given. The larger the area, the harder you work but you stand to make more money because of the potential for expansion.
Set up costs for a courier franchise like Sameday or Fastway have lower start up costs because buying or leasing a van is not in the same league as kitting out a depot. But this makes it easy to underestimate what the cost will be.
"The Sameday franchise is not difficult to operate at its basic level," says Sameday UK's managing director, Len Rainford. "It is low cost and the market it a good one. But there are still plenty of ongoing costs for vehicle maintenance and fuel."
The van might cost as much as £500 a month to lease and keep running but that is your main expenditure. Most franchisees work from home, which cuts the costs down considerably.
Sameday would like franchisees to expand the business enough to require two other vans. This isn't obligatory but there is a certain expectation. Alastair Wallace with Sameday in Bolton has two drivers and, as he says his phone never stops ringing, it would seem he has more than enough work for three.
For ANC regional franchises, you will be looking at taking over an existing depot and vans in the latter case and buying new premises and equipment in the latter. But this doesn't necessarily make ANC cheaper. Alex Reyner of ANC Manchester found he had to replace most of the vans and re-kit the warehouse when he bought his franchise.
Managing the costs is more complex too. You might have 30 or more drivers to pay as well as vans. ANC's John Hamill estimates the costs,
"You might need £20,000 to kit out the depot and then if you have 10 vans leased at £450 per month, per van that's £4,500. Plus the van lease might have to be paid 2 months in advance initially. The biggest outlay is certainly in the first 30 days."
Based on the successful New Zealand and Australian models, Fastway estimate you will need £100,000 to set up a depot. These are frightening sums, but don't forget, the bank can potentially lend as much as two thirds of the costs.
