Local delivery services are a key growth strategy that can help you stay ahead of consumer trends, enhance your business's competitiveness, innovate the customer experience, and increase sales. This blog post will provide practical information for small business owners and online businesses to establish their own local delivery services.

The recent remarkable development and growth of AI has brought about a significant shift in shopping trends worldwide. The proportion of online shopping, which allows for contactless consumption, has exploded, creating new opportunities not only for large online platforms but also for small and medium-sized local businesses. In particular, This shift is clearly demonstrated by research showing that more than 50% of consumers now prefer locally owned, independent businesses (see original English text) .

Local delivery services are emerging as a key strategy for strengthening customer relationships and increasing brand loyalty, going beyond simply providing a means of logistics for product delivery. However, many small business owners and aspiring entrepreneurs still feel overwhelmed by how to launch a local delivery service. There are many factors to consider, including which delivery method to choose, how to set shipping rates, and how to market to customers.

In this guide to building a local delivery service from Shopify, we've covered the details of establishing a local delivery service strategy for your business and launching your own service.

What is local delivery service?

Local delivery service is a service that quickly delivers products purchased online or offline directly to the customer's doorstep within a region close to the business's store or logistics hub.

Consumer trends have long been evolving toward a demand for "convenience" and "immediacy." "Same-day delivery," "dawn delivery," and "rocket delivery" are representative examples of logistics services that have rapidly grown in response to these market needs.

The key lies in the scope of "local," "directness," and "speed." Sellers directly control logistics, enabling them to provide reliable service, while customers can quickly receive the products they need.

Local delivery services are the final step in completing this "local consumption" experience. The convenience of ordering online and receiving your purchases directly from your local store or via local delivery further enhances consumer satisfaction and the enjoyment of shopping.

Local delivery services are increasingly becoming a competitive advantage, not an option.

Find recommended local delivery service providers/companies

While you can handle local delivery services yourself, enlisting the help of an outside professional can be more efficient. Below are some domestic and international companies specializing in local delivery services, including same-day delivery and last-mile delivery (*the final step of delivery to reach the customer, a delivery method that prioritizes customer convenience, such as dawn delivery or rocket delivery).

Major global/America-based logistics companies and startups:

• Roadie : A subsidiary of UPS, Roadie offers same-day, next-day, and scheduled delivery services, including same-day delivery within a radius of approximately 160 km (100 miles). It focuses on specific regions.
• FedEx : A global logistics company, it is competing in regional delivery services, including providing nationwide same-day delivery in some areas of the United States.
• Dropoff, TaskRabbit, Dolly : These are delivery or errand-based platforms operating in the Americas that can be used as alternatives or collaborative models for local delivery services.
• Uber Direct / Postmates : Logistics services offered by ride-hailing platforms like Uber offer instant delivery options, allowing businesses to deliver directly to customers through their apps. This is particularly useful for restaurants and retailers looking to quickly launch local delivery services.

Major domestic courier and logistics companies:

• CJ Korea Express , Rosen Express , Hanjin Express , Lotte Express Back : These major domestic courier companies have nationwide logistics networks. Partnerships are also possible through local delivery services, including pickup and delivery services for corporate clients, or contracts for logistics within specific regions. For example, if you're shipping a certain volume of packages within a specific timeframe, you can explore efficient local delivery service integration through contracts with local distribution centers.

Domestic regional and dawn/same-day delivery service startups/platforms:

• Coupang (Logistics solutions other than Rocket Delivery) : Coupang's "Rocket Delivery" is a prime example of its own local delivery service network. Coupang also offers a variety of logistics solutions for its merchants, enabling them to deliver products to customers faster and more efficiently.
• Oasis Market (Dawn delivery/24-hour delivery) : Oasis Market's dawn delivery and 24-hour delivery services, which mainly focus on fresh food, are successful examples of regional delivery service models targeting specific regions, and they have the know-how to deliver specific types of products or at specific times.
• Other Local Quick Service and Delivery Agencies : Various quick service providers and delivery platforms operate nationwide and within each region. They utilize a variety of vehicles, including motorcycles, bicycles, and cars, to quickly deliver items within specific areas. Delivery agencies derived from food delivery platforms are increasingly being used as alternatives to local delivery services by retailers.

Additionally, your business may have local delivery services, such as small businesses specializing in walk-in or eco-friendly delivery, in the area and city where your business is located. Regardless of which company you choose, carefully consider its reliability, delivery speed, pricing structure, delivery coverage, and customer support in case of issues.

Detailed instructions on how to start your own local delivery service.

In addition to utilizing external vendors, you can also build and operate your own local delivery service system. While this may initially involve technical challenges, such as setting up a delivery system, the long-term advantage is that you gain complete control over the delivery process and maintain a consistent brand experience.

Let's take a look at the specific steps to start your own local delivery service.

Detailed Guide to Building a Local Delivery Service (8 Steps)

1. Select shipping origin
2. Select delivery area
3. Shipping fee calculation
4. Purchase Confirmation Section Regulations
5. Establishing a delivery method and selecting a delivery entity/company
6. Establish response measures for potential issues that may arise during delivery
7. Effectively promote on-demand local service to your customers.
8. Synergy with pickup options

1. Select the shipping origin

Your shipping origin will vary depending on whether your business operates solely online or also includes a physical store. If you have a physical store, that will likely be your primary shipping origin. If you operate multiple stores or have a separate warehouse, you'll need to decide which location will handle local shipping, or whether multiple locations will handle it simultaneously. If you ship from multiple locations, ensure each location has sufficient staff and inventory. For online businesses, your shipping origin could be your home, office, or a small warehouse with inventory.

2. Select delivery area

Once you've determined your delivery origin, you need to define the specific areas where local delivery service is available. Rather than simply saying "my neighborhood," define which areas will be covered and what criteria will be used to deliver.

• By ZIP Code : One of the most common methods is to group specific ZIP codes or multiple ZIP codes into delivery zones. This can be easily implemented when setting up an online store.
• Radius-based : You can set a delivery radius (e.g., 5km or 10km) around the delivery origin. While this method is intuitive, keep in mind that actual delivery times and efficiency may vary depending on road and traffic conditions. It can also be difficult to manage if a specific area or neighborhood extends beyond the delivery radius.
• Based on demand analysis : It's also effective to analyze areas with high order volume or high concentrations of potential customers and set delivery coverage based on those areas. Setting delivery coverage too broadly can lead to longer delivery times and higher costs, while setting it too narrowly can make it difficult to attract potential customers. Consider your business's size, delivery capacity, and key customer base to select realistic and promising areas.

3. Shipping fee calculation

While customers prefer free shipping, businesses must consider the actual costs associated with operating a local delivery service, including labor, fuel, and vehicle maintenance. Realistically, it's difficult to always offer free shipping, so setting appropriate shipping rates is crucial. Consider the following methods to determine shipping rates.

• Set a minimum order amount : You can set local delivery only for orders exceeding a certain amount (e.g., 30,000 won, 50,000 won, etc.). This helps increase your average order value (AOV, a metric that measures expected sales or average customer spending patterns based on a customer's shopping cart). In this case, offering free or very low-cost local delivery when the minimum order amount is exceeded can help customers make a purchasing decision.
• Set fixed shipping rates or zone-based differential rates : You can set fixed local delivery rates for orders within your delivery area, with no minimum order amount. Alternatively, you can divide your delivery area into multiple zones, with lower rates for shorter distances and slightly higher rates for longer distances. In other words, it's reasonable to charge for local delivery based on the range of orders you can accommodate, increasing the cost as your delivery area expands. Calculate your actual shipping costs and compare them with competitors' rates to find a balance that ensures profitability without overwhelming your customers.

💡 Expert Advice : Setting up a local delivery service is easy with a Shopify store. You can set delivery zones and set different minimum order amounts or fixed shipping rates for each zone. Set store pickup options and rates to offer your customers a variety of pickup options. Leveraging the Shopify store's settings allows you to run an efficient local delivery service without the hassle of calculating shipping costs.

4. Purchase Confirmation Period Regulations (Order Deadline Setting)

While local delivery services offer fast delivery, that doesn't mean they deliver immediately after a customer purchases or deliver every order every day. Clearly define the days and times of the week when local delivery will be available, as well as the cutoff time for same-day delivery.

For example, you should set a specific delivery schedule and communicate it to your customers, such as "Orders placed before 2 PM will be delivered the same evening" or "Delivery between 3 PM and 6 PM on Mondays, Wednesdays, and Fridays." It's also a good idea to offer options such as same-day delivery, next-day delivery, or delivery within 2-3 days.

For local delivery services, longer delivery times can negatively impact customer satisfaction. It's crucial to clearly communicate delivery schedules with customers before, during, and after ordering.

5. Establishing a delivery method and selecting a delivery entity/company

This is the stage where you decide how to actually deliver your products to your customers. There are several shipping methods available, and the choice will largely depend on the specifics of your location and the scope of your delivery area.

• Self-delivery : This method involves the business owner or their hired staff delivering the products themselves. While initial costs may be low, managing personnel and time can become challenging as delivery volumes increase or the delivery area expands. However, the advantage is that it allows for a stronger brand experience through direct communication with customers.
• Using an external delivery service provider : This method involves using a professional local delivery service provider, a courier service provider, or a delivery agency platform. This method offers the advantage of flexibility depending on delivery volume and less burden on delivery personnel management. However, fees apply, so be mindful of overall cost management. Since delivery drivers represent your brand, it's crucial to carefully select the provider and maintain a high level of service.
• Hybrid approach : You can use a combination of methods, such as doing your own deliveries when order volume is low and using an external company in parallel or switching to one when order volume increases, or doing your own deliveries in certain areas/time zones and using an external company in other cases.

💡 Expert Advice : Setting up a local delivery service is easy with a Shopify store. You can set delivery zones and set different minimum order amounts or fixed shipping rates for each zone. Set store pickup options and rates to offer your customers a variety of pickup options. Leveraging the Shopify store's settings allows you to run an efficient local delivery service without the hassle of calculating shipping costs.

While courier delivery is common, some areas may opt for motorcycle delivery or pedestrian delivery depending on traffic and road conditions. For bulky items like furniture and large appliances, courier delivery or professional installation services may be required. Even if you lack in-house delivery personnel, you can explore efficient delivery options by utilizing specific app-based delivery services or through corporate contracts with existing logistics providers. While these methods offer visibility into the entire delivery process, allowing for transparent delivery management, please be aware that additional costs may apply.

Regardless of the local delivery service provider, it's important to remember that delivery is part of the customer experience. Even if the delivery provider isn't your brand's employee, the quality of service they provide is an extension of your brand experience, so you should be mindful of this when selecting and managing your delivery partners.

6. Establishing response plans for problems that may arise during delivery.

During delivery, customers may be absent or unexpected situations may arise. While simply leaving the package at the front door or in the mailbox may seem simple, this can actually pose risks to the product's safety, freshness, or theft. Furthermore, this approach can sometimes be limited by issues like shared front door codes.

• Obtain and utilize customer contact information : When an order is placed, obtain the customer's contact information (phone number) so that the delivery person can contact the customer immediately and resolve the situation if an issue arises.
• Request delivery instructions : It's a great idea to ask customers to enter their own delivery instructions (e.g., "Leave at the door" or "Leave at the security office" if I'm not home) at checkout or during the order confirmation process. This gives customers the option to receive their items safely and in a way they prefer.
• Shipping Procedures for Specific Items : For items requiring adult verification, such as alcohol or tobacco, legal regulations require customers to present their ID and verify their adult status upon delivery (see below). When placing such orders, we will clearly inform customers of the required procedures (e.g., ID verification or confirmation upon delivery) before placing the order. You'll find that liquor stores like Great Lakes Brewery (read in Korean at the top left of the page) provide detailed instructions on their website or during the checkout process.
• Exchanges and Returns : Consider how to retrieve items delivered via local delivery services if they require exchange or return. Incorporating customer-friendly options into your return policy, such as free local delivery for replacement items or free pickup for returns, can improve customer satisfaction.

Image Caption: Example of a pre-delivery notification screen informing customers that certain items, such as alcohol, require adult verification and identity verification, will undergo necessary procedures, including ID verification, upon delivery (overseas example).

Example of linking to the identity verification process page when ordering items requiring adult verification, such as alcohol (domestic case)

7. Effectively promote on-demand local service to customers.

No matter how excellent your local delivery service system is, it's useless if customers don't know about it. You need to actively promote your new local delivery service to potential customers to increase usage.

• Actively utilize your website : Your website is the primary channel for promoting your local delivery service. From the moment your service launches, use pop-ups, banners, or marquees (HTML tags that display announcements using moving text or images) at the top of your website to ensure easy recognition by visitors. Shipping Policy You should also add detailed instructions about local delivery services to your landing page and checkout page.
• social media Utilize : Post about your local delivery service on your social media channels (Instagram, Facebook, etc.) and run paid ads targeting the areas where you offer this service. Content can include behind-the-scenes stories about delivery, introductions to delivery drivers, and customer reviews of local delivery services.
• Email Marketing : Segment your existing customer list by region and send emails to customers in areas where local delivery is available to announce the launch of your new service. Offer discount coupons or coupons for your first local delivery order. Free shipping It is also effective to induce purchases by offering events, etc.
• Search Engine Marketing (SEO) : Customers looking for local delivery services are likely to search for keywords like "[product] delivery near me" and "same-day delivery [location]." Optimize your local SEO to ensure your business appears in Google search results. Update your Google My Business profile, incorporate local keywords naturally into your website content, and list your information in local online directories and communities. (You can also leverage free local SEO tools from Shopify .)

• Retargeting Ads : You can encourage customers who visited your website but didn't complete a purchase or showed interest in a specific product by sending them a retargeting ad campaign that highlights the convenience of using local delivery services.
• Traditional Local Marketing : In addition to digital marketing channels, traditional marketing methods that leverage an understanding of the local community and local events to directly reach out to local delivery service customers remain effective. Consider posting flyers promoting your local delivery service in local gathering places (neighborhood bulletin boards, local supermarkets, community centers, etc.) and partnering with local businesses (e.g., nearby cafes, bookstores) to promote each other's services.

8. Synergy with pickup options

While local delivery services offer the best convenience for customers in your area, not all customers may want delivery, and you also need to manage orders from customers outside your delivery area. In this case, a "pickup option" is a great complement to your local delivery service.

• In-Store Pickup : This option allows customers to order online and pick up their items at your physical store. This saves customers shipping costs and encourages them to visit your store, creating additional opportunities for purchase.
• Curbside Pickup : When a customer arrives at a designated location in front of the store, an employee brings the item out and delivers it to their vehicle or directly to the customer. This offers the advantages of saving time and allowing for contactless pickup. Curbside pickup can be a suitable alternative, especially for customers who want to quickly place an online order outside of their local delivery service radius but find standard delivery options unavailable or too expensive.

White Rock Soap Gallery , a retail store located in Texas, USA, is a successful e-commerce business that offers a variety of innovative ordering and pickup options, including local delivery, curbside pickup, standard delivery, and pickup from a local farmers market.

Image Caption: Information on services provided, including free shipping, free local delivery, and curbside pickup.

Clearly outline the various pickup methods on your website and help customers choose the most convenient option. Store pickup and curbside pickup services can be offered even if you don't own a physical store.

Use your warehouse or office as a pickup location or pop-up store that operates only on certain days/times. Operating a store pickup location (see original English text) is also an option. Alternatively, consider partnering with other local businesses to utilize their spaces (e.g., cafes, bookstores) as pickup hubs.

Key Benefits of Local Delivery Services

Offering local delivery goes beyond simply adding a delivery option; it brings about a number of positive changes to your business. Key benefits include:

1. Building and strengthening relationships with the local community

Local delivery services strengthen the sense of community and provide convenience to local communities, naturally fostering positive word-of-mouth and trust. They also play a crucial role in maintaining and increasing physical connections with existing, loyal local customers. Keep in mind that offering local delivery is a crucial element in attracting new customers and building repeat business in your area.

2. Improve customer delivery experience

Nationwide courier services sometimes experience unpredictable delivery delays, a major cause of customer dissatisfaction. Furthermore, high shipping costs are a common factor that causes many customers to abandon their shopping carts.

Local delivery services can significantly alleviate these delivery delays and unexpectedly high shipping costs. By directly controlling the delivery process or partnering with local specialists, businesses can reduce their reliance on the logistics of external, large-scale couriers and provide customers with a more reliable and predictable delivery experience.

3. Increase online sales

The most tangible benefit of local delivery is its potential to boost online sales. Shopify data shows that when independent retailers offer convenient ordering and pickup options, such as in-store pickup or local delivery, online shoppers spend 23% more and add 25% more items to their shopping carts. This is because the assurance that customers can receive their items quickly and conveniently, in the way they want, lowers the barrier to purchase and encourages additional purchases.

Meanwhile, online shoppers who chose in-store pickup or immediate delivery (on-demand ordering) at checkout saw 13% and 19% higher conversion rates, respectively, than those who opted for standard delivery. This means that simply offering a convenient pickup option can be a highly effective way to convert visitors into actual shoppers.

We impose conditions such as minimum order amount on local delivery services. You can also simultaneously employ strategies to increase average order value . Platforms like Shopify allow you to freely select multiple shipping zones and apply differentiated rates to each zone, allowing you to manage profitability while also increasing customer satisfaction.

Boost Sales with Shopify Local Delivery

Shopify provides online store owners with features that allow them to easily and efficiently implement and manage local delivery services. Giving customers the choice of when and how they receive their items removes obstacles to completing a purchase, ultimately increasing revenue.

With just a few settings within your Shopify admin, you can activate local delivery and easily set delivery zones (e.g., by ZIP code or specific area) and delivery rates (e.g., fixed amounts or minimum order amounts) for those zones. We also offer the Shopify Local Delivery app (free trial available, English version) to help you efficiently manage your delivery process. These features contribute to increased delivery transparency and improved customer satisfaction.

Offering local delivery through Shopify goes beyond simply adding functionality to your logistics system. It strengthens emotional connections with local customers and establishes your business presence in the community. Ultimately, it leads to satisfied customers and a steady stream of loyal customers. It provides a solid foundation for long-term business growth (see original English text) .

Design a sustainable business with local delivery services.

In the new normal post-pandemic era, local delivery services are becoming a key strategy for local businesses to survive and thrive. As this guide explores, establishing a local delivery service involves several steps: defining delivery areas, setting rates, selecting delivery methods, and effectively promoting your business. While this process may seem complex at first, Shopify's convenient tools make it easier than you might think to get started and manage.

Consider and implement local delivery services for your business today.

Local Delivery Service FAQs