Business Ideas | Small Business Ideas: How to Start a Small Delivery Business

Thursday, September 11, 2014

How to Start a Small Delivery Business | Home Delivery Business

A local delivery service is a small business almost anyone can start. Such a service can be offered to those needing personal errands run or to businesses who need supplies or documents delivered, or even lunch. Although the start-up costs for a delivery service are small, treat it like any other business by first developing a comprehensive plan and researching what type of deliveries you want to start off making.

A home business is something that many people seek in the pursuit of better hours and a shorter commute. A delivery business is a useful business to the community and can be run from home as easily as it can from a central office. You just need to know how to get started with your home delivery business.

Instructions:

Step 1

Get a vehicle that will be appropriate for the job. It should be a low-mileage vehicle in good condition that's big enough to haul the items you will be delivering. A vehicle break down and late deliveries will destroy the reputation of the business and be costly both in lost revenue and repair work, so it's best to choose wisely.

Step 2

Apply for a business license. Call the local courthouse for information about where to get the license information and what will be required. There will be a license fee up front and a renewal fee each year.

Step 3

Call insurance companies for the best business rates. Your personal car insurance policy will not cover the business use of your car. Make sure to get damage coverage, as well as liability. Your delivery vehicle is vital to the business, and you have to be able to replace or repair it in the case of an accident.

Step 4

Advertise the business. Where you advertise will largely depend on what you will be delivering. Advertising in the newspaper, on a local website and perhaps even a local commercial will get the word out. If you will be delivering food, be sure to advertise at the local college and send fliers to businesses that might order out food for lunch meetings.

Step 5

Have someone at home taking orders. You won't be able to effectively take orders from the road. Someone will need to man the phones at home to keep orders coming in. You will also need to have a reliable way for that person to contact you on the road and relay the new orders.

Step 6

Call your county clerk's office and find out if there are any licenses or permits you need to apply for before starting out. Although the majority of your business will be done outside your home, because you will likely be using a home office, you might find you need to clear this with your county or city first.

In Harris County, visit the website of the county clerk's office and download the form for the registration of a business name. The options depend on the number of employees and whether you are an incorporated business--most likely not, at this stage.

Step 7

Call your car insurance company if you will be using your car (some use bicycles). You want to make sure you are covered for any issue that may come up as you will now be using your car for business purposes.

Step 8

Make a list of the businesses in the area whom you believe could benefit from your services. These could be pharmacies, grocery stores, banks, restaurants, flower shops, hospitals, offices or gift shops. You can also list senior centers and make picking up items for seniors who can't drive part of your service. List businesses you think might like to have lunch delivered to them each day.

Step 9

Create flyers, business cards and a website for your business. Once you've decided what services to offer, create an interesting flyer or brochure that you can post on public bulletin boards and bring to businesses you believe can benefit from your services. Your website should include your contact information and also an online form where customers can place their delivery requests.

Step 10

Purchase a magnet with your new business name and contact information to place on your vehicle. Alternatively, you can get the information painted on or use vinyl lettering. Because your vehicle will likely be your place of business, it is essential to promote what you're doing.

Step 11

Price your services appropriately. Even though you are just starting out, don't be tempted to make your prices lower. Price yourself according to what the market will bear and keep in mind you will have to deal with fluctuating gas prices and varying mileage. Staying within your city limits might be essential at first, at least until you become known and are more experienced at the business. Call other delivery services--even services in other cities--and find out what they charge. This will help you determine your baseline prices.

Step 12

Have the sender and recipient sign for their deliveries. You never want to be accused of not having delivered an item. Create a form that is simple but requires both parties to state the item and when they received it.

Things Needed:

References

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Easy Tips and Ideas to Start Business

Although anyone can start a business, many people fail because of a bad product or improper research. If you want to start your own business, you can improve your chances for success before you even begin. In order to make your business successful, start strong and make sure that your idea will hold out for the long haul.

Have a Good Product

Ensure that you plan to sell something useful. Although you may think that your product is important or special, that doesn't mean the general public will agree. Ask friends, family and strangers what they think of your product. If they don't seem that interested, ask them why. With their suggestions, you can either improve the product or scrap the idea completely. According to Brad Sugars of Entrepreneur magazine, most small businesses fail because they sold a product that didn't have an adequate market. This also applies to small businesses that provide a service. A lawn-care business might be useful for part of the year in a northern state, but it is in-demand year-round in the south. Consider whether people will actually want to use your service and get constructive advice from those not afraid to give their opinion.

Research Local Businesses

Research local companies before starting up your own business. This will not only give you an idea of the amount of competition you will have, but it will also help you price your product or service. If you're looking to start a wedding photography business, you may find during your research that the market is over-saturated in your area. If not over-saturated, you should contact each business and ask them for a price list. Alter your prices so you can stay competitive with the competition in town. Researching similar local businesses will also help you decide where to locate your business location. Try not to start up a store or office close to another business of your type. If your small business is located away from similar business types, this will cause locals to choose you over businesses that are farther away from where they live.

Get Professional Advice

You may know someone who has started their own successful business. Ask him for advice and listen to his stories of how he started his company. You may gain useful advice on the good and bad ways to start a business. Local entrepreneurs can also introduce you to local product providers or advertisers that you may not have met without their help. Accept any advice with open arms, especially if the advice is coming from someone successful in the area.

How to Calculate Business Start Up Costs

Starting a business in no easy endeavor. It takes a great deal of research, perseverance and hard work. While sweat equity will make your small business more successful, you will most likely need real capital to get the business started. Before you start raising capital and/or investing your own funds, the first thing you need to do is determine the total start-up costs.

Step 1

Determine your costs of sales. For most small businesses this means inventory, the cost of raw materials, manufacturing equipment, shipping, packaging, and warehousing. However, not all businesses sell products. In this case, the cost of sales is primarily the direct labor involved in making the sale. For example, to open a small shoe business entails purchasing enough inventory ($10,000) to stock the store.

Step 2

Determine professional fees. Planning your business structure, i.e., limited liability corporation or general partnership, means hiring an attorney. There may also be the need to pay an attorney for help with establishing trademarks, copyrights, and patents. In this scenario, that puts total professional fees at an estimated $20,000.

Step 3

Determine technology costs. Technology can greatly reduce the cost of labor for small business if used effectively. Most small businesses require computers, printers, cell phones, website development, Internet access, software applications, information security, data storage, and outsourced information technology (IT) consulting. If the cost of technology is $10,000 to start, add an additional $5,000 a year for maintenance (hint: maintenance is not included in start-up costs).

Step 4

Determine administrative costs. This varies with business types and may include items such as business insurance, office supplies, product packaging, parking, rent, express shipping, desks, chairs, fax machines, phones, or anything else necessary to operate the business daily. A good estimate for start-up administrative costs would be $5,000 for the first six months.

Step 5

Determine initial sales and marketing costs. Now that you have your product, you need to let folks know about it. Sales and marketing costs generally include marketing materials for presentations, printing stationery, business cards, advertising, trade show events, and public relations. These initial sales and marketing costs can add up to $3,000.

Step 6

Determine the wages and benefits needed to secure a staff. This includes employee salaries, benefits, workers compensation, and payroll taxes. Let's put the cost of wages and benefits estimated at $20,000 for the first three months of business.

Step 7

Add all costs associated with starting the business for a total. Be sure to only include business start-up costs that will be incurred in the first three to six months of operations. For this example, the calculation is: $10,000 + $20,000 + $10,000 + $5,000 + $3,000 + $20,000 = $68,000.

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