How to Start a Delivery Business With Contract Drivers
If your dream is to start a delivery business, it is an excellent idea to plan on using contract drivers. Having independent contractors doing the driving for you can help you distance yourself from liability, as well as allow you to concentrate on the main aspects on the business instead of the actual driving. To start a delivery business with contract drivers, you should take the following steps.
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Instructions
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Perform a market study. Figure out if there are any holes in the market that you could fill with your delivery business. You should find a niche in the market for a delivery service where you will be able to be financially successful. For instance, you could deliver meals to senior citizens or special treats to pets. The best way to do this is to scope out the competition in your area and inquire about their prices and offerings or conduct an informal survey with your targeted audience.
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Make a business plan. You must draft a business plan including information about the type of delivery business you will start, your company's name and vision statement, projected costs of expenses and income, targeted audience and key players (employees or second-tier management). For examples of business plans, visit B Plans (see Resources for link).
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Obtain financing. Determine whether you can fund the start-up costs for your business out of your own money, or whether you will need to take out a business loan. Shop around to see what financing offers you can obtain from various banks and financial institutions. You will need to apply for a business bank account and business insurance as well.
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Contract with suppliers. You will need to find suppliers of the product you plan to deliver and sign detailed contracts with them. Be sure your contact spells out time frames, any penalties for late delivery, termination and insurance requirements, as well as who will bear the liability of a missed delivery or damaged goods if a problem occurs with the delivery.
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Contract with drivers. Decide how many drivers you will need to run the delivery business, then decide what salary would be within your budget. A little research can tell you whether this salary would be competitive. One great resource to check salaries is Indeed (see Resources for link).
Decide whether the contract drivers will drive their own vehicles or whether you will provide vehicles with your logo on the side. Drivers who are strictly independent contractors and provide their own cars would be preferable: You would have less liability than employees of your firm, as they would be extensions of your delivery company.
Either way, make sure to have adequate contracts with the drivers that spell out salary, delivery requirements, late penalties and your protection from liability. You should also include a termination clause and list requirements for insurance that the drivers must keep.
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Create a marketing and advertising plan. You may want to hire a professional marketing firm to help you create a logo and help you decide how to advertise. Another option is to simply advertise yourself through trade journals or online. Your decision regarding marketing will depend on the type of delivery service you plan to operate.
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