How to Start a Delivery Company
- 1). Determine the kind of business structure that will suit your business needs, such as a sole proprietorship, partnership, Limited Liability Company (LLC) or other legal business structure.
- 2). Create a list that details what products you will deliver, such as food, alcohol, flowers, legal documents or something else, and how you will transport those items. For example, decide if you will purchase a van, use your own personal vehicle or buy a bicycle. Additionally, list potential vendors for the products that you intend to deliver, such as local grocery stores, restaurants and bakeries for a food delivery business.
- 3). Devise a pricing structure and accounting system that outlines how customers will pay you for your services, how they will pay for their items and if that will be included in your service, as opposed to the customer ordering an item directly through the vendor. For example, customers ordering their food through the restaurant and then hiring you to pick it up and deliver it versus you ordering it from the restaurant for the customer and then delivering it.
- 4). Evaluate your costs when determining prices. Assess how much it will cost you in gas to deliver items and how much time it will take you to get to certain areas or to pick up and deliver certain kinds of items. Determine the profit margin that you need in order to keep your business financially solvent.
- 5). Determine the geographical region that your delivery business will cover and who your target customers are, taking into consideration your pricing structure. Consider purchasing a detailed street map and drawing out delivery boundaries to help you better visualize the area you've chosen. Use a website, such as ZipWho.com (see the Resources section), to research the demographics of the area that you've outlined. Focus on the average income of individuals/families and the number of businesses and primary type, to determine if the area can support your business. For example, a food delivery business may generate more customers in an area with a large number of office buildings, since many office workers are strapped for time and may be willing to pay for the convenience of having their lunches delivered.
- 6). Select the methods by which your customers can submit delivery orders, such as via phone, fax, email or an automated website form. Additionally, determine if you will run your business from your home office or lease an office space to accept walk-in customers or to serve as a central hub for several delivery employees.
- 7). Choose a name for your business. A sole proprietorship can use your name and a title, such as John Doe, Professional Courier, according to Entrepreneur.com. File a fictitious business name with your local county government, if you call your business something other than your own name.
- 8). Apply for a business license in accordance with the regulations of your local jurisdiction. You also may need a special permit to deliver certain items like food or alcohol depending upon your local liquor laws or food safety laws, advises the University of Minnesota website. Since these laws vary from state to state and sometimes from city to city, contact the local government licensing office where you plan to make deliveries to determine if a separate permit will be needed. Additionally, if you will be using a specially purchased business vehicle or your own vehicle, you must properly register it as a business vehicle and obtain insurance appropriate to your delivery activities.
- 9). Register your business with your state's tax board or department of revenue for a sales and use tax permit. Also apply for a federal Employer Identification Number (EIN) with the Internal Revenue Service (see the Resources section). You will use your EIN to identify your business to vendors, other companies and the federal government.
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Obtain liability insurance for your business and consider being bonded by your insurance company. This protects you and assures customers that the goods and services that they've paid for will be reimbursed in the event of unforeseen circumstances that may keep you from completing the delivery. - 11
Begin advertising by distributing flyers to individuals and businesses, designing a website, printing business cards, taking out an ad in your local paper and telling your family and friends about your business and asking them to tell others.
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