How to Start a Non-CDL Delivery Service Business Now: 15 Simple Steps

 

Delivery service is one of the most in-demand services today due to the growth of e-commerce businesses worldwide. Are you planning to start a non-CDL delivery service business? Clients need on-time delivery irrespective of whether you’re licensed or a non-licensed driver.

If you’re supposed to make deliveries to clients, you must know that logistics is a key factor to business success. And streamlining transport for faster delivery is what will give you an edge in business compared to some of your competitors.

When it’s a local business a commercial driver’s license is not very necessary hence starting up gets much easier with a Non-commercial driver’s license available. In detail, we are going to look at how you can start up the delivery service business with a Non-CDL.

What Is A Non-CDL Delivery Service Business?

CDL and non-CDL delivery service businesses are quite different in terms of operational requirements.

Delivering goods using a CDL truck is done by a CDL delivery service business whereas delivering goods by non-CDL trucks is done by a non-CDL business.

Pros and Cons of a Non-CDL Service Business

Starting a Non-CDL delivery service business is a good idea but you need to look at both the positive and negative side of the business in order to successfully work the business right.

Pros

• It is profitable since loads pay quite some good money compared to transport costs.
• You can work on your own schedule to make deliveries to clients.
• It doesn’t need lots of certifications to get started
• Compared to CDL, you don’t need a lot of money to get started.
• Deliveries are made to nearby locations hence costing less in transportation

Cons

• The capital requirement to purchase a truck is quite high
• Weather changes affect timely deliveries to clients upon making orders.
• Poor network infrastructure affects communication
• Fluctuation in fuel costs lowers profit margins on some deliveries made

How to Start a Non-CDL Delivery Service Business

Like any other business, starting up a Non-CDL service for success you must put in the work. But without further ado, let’s get into the steps of how to start a Non-CDL delivery service business.

1. Market Research

Researching the business and the available opportunities is a very crucial aspect of any new start-up in any line of business. You need to put in some effort where it’s due to avoid wasting time and money.

Market research will help you understand your competitors in business and how best to approach the industry with an edge. It doesn’t matter whether you’re new in the business, but as long as you can deliver according to expectations.

So, since you’re dealing with local businesses and individuals carry out market research to know who they are and where to find them to serve competitively when the need arises.

There’s no way you’ll understand your competitors in terms of strengths, weaknesses, opportunities, and threats without carrying out market research. Yes, it’s the best strategy to use to benchmark other businesses to understand the industry at large before the official opening.

2. Get a Niche

Right after carrying out market research, you will have to pick out a niche that suits your business now and in the future. Individuals and businesses need to recognize your start-up within an area of expertise in terms of service delivery.

For example, you can start making deliveries of strictly ready-made food to clients using online apps. This means not going into packages, moving people, or any other gig not in line with your business.

But deciding to do so will depend on the need for the service you want to offer in a given location using the information obtained from doing market research. Sure, get into a potential business-specific venture that’s proven to give results on the ground despite some challenges.

Choosing a niche is what will give you status in business to acquire market share with a competitive advantage. It’s wise to start small compared to doing many things at once when you’re just getting started in the industry.

3. Choose a Suitable Business Model

To succeed in a non-CDL delivery business, identify the right type of business model suitable for the market. This will depend on the niche selected and its viability at large in the long run.

There are basically four business models from which you can select a suitable type: Consumer-to-consumer, business-to-consumer, business-to-business, and the Hybrid model.

• Consumer-to-consumer is where the business makes deliveries between individuals.
• Business-to-consumer, deliveries are made from businesses to individual consumers and it’s among the fastest-growing sectors today.
• Business to business, deliveries are made from one business to the other in a similar sector.
• The hybrid model is a combination of both business-to-business and business-to-consumer business models.

Choosing the right type of business model will put you at an advantage in exploiting all the available opportunities for better service delivery.

4. Make a Business Plan

Creating a business plan is among the most important aspects of a new start-up in any industry. It’s a guiding tool during the implementation process to achieve success.

Executive summary, Market analysis, operational standards, budgeting, company description, organizational structure, development plan, and more are some of the components of a business plan.

A business without a plan is more of a business planned to fail in the near future. But of course, you can’t plan to lose on an investment.

5. Get a Business Location

Another very important step in starting up a non-CDL delivery business is finding an appropriate location for business offices. A strategic location is ideal for convenience and timely delivery to clients.

Put business offices in a location where your target market can easily be accessed for business purposes. And besides, business location is a determinant factor in terms of taxes and legal requirements upon registration.

You will want to locate business offices in a state where starting up a Non-CDL business comes with a number of benefits like minimum taxes and fair legal start-up requirements. So, if there are some states where Non-CDL delivery services are prioritized and fairly treated, you may consider moving to that state.

6. Form a Legal Business

For the business to start operations without breaking the law has to be formalized through registration. Consider a perfect business structure that suits the business model chosen for the start-up.

Let’s look at the 3 main types of business structures to choose from before getting started.

Sole Proprietorship – it is a one-man business with full control and liable to any business proceedings that may occur.

Partnership – this is started by a number of individuals whereby they are all equally liable to business proceedings.

Limited Liability Company – compared to a sole proprietorship and a partnership, there are tax and liability protection benefits under this business structure.

With a business structure selected, then you have to get a business name to reserve it. Also, get an Employer Identification Number (EIN) for business recognition by the tax authorities.

7. Tax Registration

Besides a sole proprietorship business, you must apply for an Employer Identification Number (EIN) to be able to pay taxes. But for a sole proprietorship, your social security number is the one used for tax purposes instead.

Like any other new start-up, you need to identify a tax year starting in a given month of the calendar year after getting an employer identification number.

8. Acquire a Business Bank Account

You’ll need to separate personal money from business income with the help of a company account. This is safe custody for business revenue compared to keeping it in a slippery personal account.

When it comes to accountability and tax computations, a business account is a lifesaver since it’s strictly meant for business transactions. There are fewer complications around opening up a Non-CDL delivery business account.

However, before opening up the account talk to the service providers about their requirements, charges, and benefits to get the best offer. Usually, banks will need the EIN or SSN for tax purposes, articles of incorporation, business addresses, directors, and some other formal documents.

9. Get Funding For a Non-CDL Service Business

When the business is just starting it needs to be funded to keep operating and deliver effective service to clients. You could have some startup capital but it might not be sufficient to sustain business operations in the long run.

Let’s look at some ways in which to get funding for the Non-CDL delivery service business.

• Personal Savings

  Maybe you decided to live cheaply to have money saved in your account for investing. Personal savings save you from borrowing money and starting up a debt-free business.

• Government Grants 

  Check out platforms like grants.gov to get government grants to fund business operations.

• Crowdfunding 

  Reach out to potential funders through platforms like Fundable, Wefunder, and other platforms to get funding for the Non-CDL delivery business.

• Family Members and Friends 

  Talk to immediate friends and family members about the business idea for financial support. Some of these people will be willing to either invest in the business to become shareholders or offer loans.

Consider an appropriate mode of business funding that suits the Non-CDL delivery service business structure chosen.

10. Get Licenses and Permits

Apply for licenses and business permits from responsible authorities to start the business. The state, federal government, and local authorities must authorize your business operations.

Depending on the selected area of office, the process of acquiring licenses and permits may differ for different reasons according to business type. One of the official bodies to consider when it comes to licensing and permits is the Federal Motor Carrier Safety Administration (FMCSA) responsible for transportation and motor carrier number licensing.

However, when you want to drive to different states you must get an international registration plan and an international fuel tax agreement tag.

Other forms of business licensing and permits required for the startup are trademarks, patents, health and safety licensing, and more as advised by an expert or authorities.

Also, make use of online resources like the Small Business Administration (SBA) guide to get thorough insights about licensing requirements in your state. SBA guide is an all-in-one online resource where you can easily get access to specific documents to use to keep up with state licensing laws.

11. Staffing

When the business is just getting started, people to work with may not be among the main concerns. But after some time with some deals coming up you may need a team to assign work.

As the business grows there will be demand for delivery drivers, customer support assistants, marketing experts, managers, recruitment officers, and more. You may not hire all people for these positions at once, but it’s one of the things that must be put into consideration in relation to demand.

Getting people to work with is not hard at all since there are lots of paid and unpaid online platforms where you can place ads and get thousands of applicants. The platforms include Facebook, UpWork, indeed, jobs.com, Fiverr, and more.

You don’t need to put a lot of money into job advertisements since the business is just starting, unpaid platforms can also definitely get you quality employees with the required skills.

Hiring a team to work with should be handled with some level of competence to avoid employing people who may spoil the business’s status during its infant stage.

12. Business Insurance

Protecting the business against any unpredictable costs is very important for any new start-up. Insurance is one of the best ways to go about such incidents likely to lead the business into huge costs and debts.

There are different types of insurance that you can put into the priority list for the start and others to consider as the business grows.

• Commercial Auto Insurance

  This car insurance plan is meant to cover business vehicles.

• Liability Insurance

  This is an all-in-one insurance policy for the business which further covers the injured and property damage. Despite the high premium costs with some service providers, it’s a policy you really need for the business.

• Worker’s Compensation 

  The insurance policy covers workers who get injured while doing business work during working hours.

• Business Property Insurance

  This type of business insurance covers equipment and supplies.

Prioritizing business insurance it’s neither a waste of money nor time. The business can easily shut down without insurance when it gets unprepared for costs that may wipe out capital.

13. Establish an Online Presence

Despite way back in the 90s when businesses mostly needed a physical location to start up, today working without an online presence limits a lot of business opportunities.

You need a business website and social media platforms to have an online presence established to reach out to potential clients with convenience. To come up with a professional online platform you need a website designer or a social media expert to assist at a cost in case you don’t have your own tech skills.

The best part, professional online platforms play a very important role in marketing the business to exploit available opportunities.

Some social media platforms you need to establish a viable online presence include Facebook, Instagram, WhatsApp, Twitter, Snapchat, and more. Utilize some of these platforms to reach out to different audiences for business.

14. Route Planning and Transport

Before making a delivery you need to know which routes you’re going to use to manage time and fuel costs in a Non-CDL delivery service business. Identifying cost-effective routes for making deliveries will save the business a lot in transportation costs.

An appropriate truck or van should be used to make deliveries using the selected routes for effectiveness and efficiency. Route planning will surely speed up operations in terms of deliveries and overall business success.

Despite planning routes the traditional way to ease transport, you can also use route optimization software to plan routes for small cars used in the Non-CDL delivery business effectively.

Route optimization software has the potential to predict and analyze transport on different routes in a number of ways for example busy and non-busy routes, time, distance, and any road restrictions that may delay deliveries.

Advanced technologies like route optimization software in business will streamline delivery operations for if applied with best practice.

15. Marketing the Business

For a Non-CDL delivery business to survive in the startup stage, marketing its services is something it should not avoid at any cost. And to reach out to customers in the shortest time possible, appropriate marketing tools and strategies should be applied.

The different platforms that you can use to reach out to thousands of customers depending on your location and delivery boundaries include a business website and social media platforms like Facebook, Instagram, Twitter, TikTok, and more.

Besides online platforms, Advertising can also be done the traditional way using fliers, banners, posters, newspapers, and car adverts. In-depth, you need to know when, where, and why you’re using a given platform to make an advertisement for the business.

Hiring a marketing expert to do the work for you would be quite expensive but the results are worth the costs. Try out platforms like Fiverr and Upwork to look out for quality cheap marketing professionals for assistance.

FAQS

How Much Money Do I Need To Start Up A Non-CDL Delivery Service Business?

Starting up a Non-CDL delivery business costs about $10,000 or even less depending on the business structure and other major requirements like a truck or van.

What Individual Requirements Do I Need To Start A Non-CDL Delivery Service Business?

To start a Non-CDL delivery business you need to have gone through high school, an adult with a sober mind and possession of driving skills.

How Long Does It Take To Make Some Profits From The Business?

Like most other businesses, to start making good profits it might at least 2-3 years when most of the things are done correctly. But it can take longer than that if you don’t put in the work to deliver good service.