- Create a business plan that addresses pricing and budgeting strategies to assure profitability and expansion.
- Make investments in technology like GPS tracking devices and route optimization software, to increase operations and efficiency.
- To safeguard the company and its employees, maintain adequate insurance coverage, including liability and workers’ compensation insurance.
- Cultivate close relationships with your customers and deliver superior customer service, to encourage recurring business and positive recommendations.
Starting your own delivery business seems like a mammoth task. You have to take care of a hundred things simultaneously. We’re not gonna sugar coat things here, it really is quite difficult.
Handling all of it together can become quite overwhelming for a small business owner starting a new delivery company. There are some things you must know before starting a delivery business of your own.
That’s why the focus of this blog will only be on how to start a delivery business with contract drivers. We will be discussing it through a simple 5-step guide which will also consider your:
- back-end; and
- front-end process as well.
Small business owners and aspiring entrepreneurs looking to start or add a delivery aspect to their business structure, then this blog is for you. Let us jump straight to the details now!
Table of Contents
- Step 1: Define A Niche for Your Delivery Business
- Step 2: Sorting out the Back-end Process for Your Delivery Service
- Step 3: Figuring out the Front-end Process for Your Delivery Service
- Step 4: Hiring and Training Your Drivers
- Step 5: Using a Route Planning & Optimization Tool for Your Delivery Service Business
- Improve Driver Efficiency with Upper Route Planner
Step 1: Define A Niche for Your Delivery Business
Apart from the big guns in the market like Amazon, FedEx, and UPS, there are quite a lot of opportunities for new delivery businesses and drivers. It is mainly because even some of the most major players in the market need affordable ways to make the products reach their customers.
Figuring out the type of business and the niche you will be focusing on will help you figure out the demand for drivers. The industry you choose will determine the costs involved with several aspects like hiring contract drivers, acquiring delivery trucks or vehicles.
Let us narrow down potential markets for delivery businesses for you:
Food delivery business: Partnering with local chefs and restaurants.
Grocery delivery business: Delivery grocery from supermarkets to the customers.
Liquor delivery business: You don’t need to start making your own alcohol, just partner with breweries and stores selling alcohol.
Meal-kit delivery service: Partner with meal-kit businesses and be their official delivery partner, handling all their delivery tasks.
Courier service business: Start a local, more affordable courier service in selected zip codes and cities.
The advantage for new delivery businesses is that they get an opportunity to provide a more personalized, hands-on delivery to the target market, which is often missing in deliveries from the giants in the market.
Once you are done with figuring out your niche, all the other steps are about optimizing the delivery process and making it more effective. Whether you are starting a large courier company or you are a small business planning to deliver packages, the basics of last-mile delivery will be the same across all businesses.
Step 2: Sorting Out the Back-end Process for Your Delivery Service
Accepting and processing orders received from your clients will depend a lot on your niche.
For instance, operating a local restaurant and adding food delivery aspects to the business will be very different from operating the back-end process as a large e-commerce company.
The design and the convenience of the back-end process will also depend largely on whether you are producing the goods yourself or you have your independent contractors picking it up from a supplier’s warehouse.
There are several platforms and tools that will help you sort out the back-end process of your delivery services.
If you are operating a larger organization, streamlining the back-end process with the help of tools is imperative. But if you are a small delivery service business, you can easily make do with internal processes or simpler tools like Excel to get your process in order.
Step 3: Figuring Out the Front-end Process for Your Delivery Service
Why is the front-end process so important for a last-mile delivery business?
The front-end process needs to be stressed upon because it is the process often visible and carried out in front of the customers. This includes fixing the food delivery route optimization.
The way your front-end process flows makes or breaks the impression you are already trying to establish as a brand and attract customers.
Understanding the needs of the front-end process and how it relates to your business
The front-end process often has different requirements when compared to the back-end process.
The front-end process requires greater optimization. It is the step involving the last leg of the delivery process so it needs to be quick and efficient.
Your niche decides how you design your front-end delivery process
While most businesses carry out their front-end processes in a similar fashion, there can be stark differences depending on the niche.
For example, the process carried out by a food delivery service and a courier delivery service will differ quite a bit. It is often about the urgency and the perishable quality of the commodity in transit.
Food delivery has same-day deliveries, which is not the case in courier delivery.
Both the processes mentioned above slightly differ from each other. While the food delivery process is simpler and more direct, the courier delivery process has more parties involved and takes some time to be fulfilled.
Step 4: Hiring & Training Your Drivers
Start by posting job ads on industry-specific job boards. You can also use your brand’s social media platforms to let potential independent contractors or drivers about the open position.
You need to check whether:
- The contract driver requires their own vehicle;
- Do they have commercial driver’s licenses & driving experience?;
- How long is the contract for?; and
- The number of stops or number of hours to work everyday.
It is not difficult to find contract drivers. You will receive heaps of applications and you will have quite a lot of options to choose from. The difficult part will be the onboarding and the training process.
Once you hire a set of delivery drivers for your company, you will be providing them thorough training. The four major areas of the training are as follows:
- Last-mile Process: This part will teach the new hire to think and operate like a driver. You will be training them for how the process works and what their responsibilities will be.
- Customer Service: You will train your contract drivers to work with a customer-centric mindset. The driver must be delivering the package the way he wants to receive them.
- Software & Tools: The drivers will be given access to and taught to use the software and tools they will be using daily on their jobs.
- Health & Safety: Train your drivers to prioritize themselves over the package. They must never put themselves in a dangerous position. They must take regular breaks and shouldn’t work longer than recommended.
Maintaining Safety & Security
Even after the required training provided to them, drivers must be given the right set of tools and guidance to help keep them safe and healthy while doing their jobs. It should be a protocol to keep doing certain things in order to be more aware and stay safe and healthy on the job.
Step 5: Using a Route Planning & Optimization Tool for Your Delivery Service Business
Empower Your Contract Drivers Using Upper Route Planner
- Import Excel: With one of the simplest import features, bringing the addresses together and creating a route becomes effortless. Dispatchers and drivers can plan routes with anywhere up to 500 stops at once.
- Add Notes & Details: Dispatchers can add specific delivery details for the drivers like service time, customer details, priorities, etc. These specific details prove to be really helpful for the drivers.
- Adjust Schedules on the Fly: Alterations to the route? Need to change the driver? No problem. Dispatchers can easily make adjustments to the route while the delivery is in progress without having to compromise with the entire route.
- Delivery Constraints: With specific delivery constraints like time windows, driving preferences, urgency, and curbside delivery, the drivers know exactly what to do at each stop without having to waste their time.
- Proof of Delivery: Drivers can capture proof of delivery through customer signatures, photo-capture, or notes to improve accountability and keep the dispatchers or managers informed about each delivery task.
- Reports & Analytics: End-of-day reports for all drivers and deliveries help the dispatchers and managers be in the loop. It helps drivers be more accountable for each delivery. Drivers can see their reports and know where they need to step up.
Accomplish More With the Tool While Delivering More Orders
Upper Route Planner helps your contract drivers achieve more, let’s see how:
- Reduced Planning Time: Upper Route Planner’s route optimization helps you cut down the planning time for creating and optimizing local delivery routes. It helps drivers and dispatchers cut down up to 95% of the planning time.
- Optimize Multiple Routes at Once: Creating and optimizing multiple routes for multiple drivers at the same time will become a breeze. Upper Route Planner divides the routes among multiple drivers depending on the details and specifications you mention.
- Cover-More Stops on the Same Route: Drivers will easily cover more stops on a single route when the routes are properly optimized. Correctly optimized routes create space and time for more deliveries.
- Reducing Cost-per-delivery: Optimized routes help drivers reach their destinations in time without having to go around, covering extra miles. It helps them save time and money. With optimized routes, drivers and delivery companies can save cost-per-delivery.
- Improving Profitability: Upper Route Planner helps businesses by accommodating more delivery services without having to hire more drivers by empowering the ones that are already working. So Upper Route Planner not only saves costs, it also improves profitability.
Starting an independent delivery service will require you to have fuel-efficient vehicles of your own (cargo van, compact car, box truck or pickup truck) and get all the right licenses and state permits to operate independently. You can get in touch with local businesses requiring delivery assistance and work as a contract driver with them.
As more people are starting to work remotely and not stepping out much, the need for a courier business has only been increasing in the recent past. Even the big companies are swamped with orders that become difficult to fulfill at times. When you start your own delivery or courier business, you are bound to get more clients and orders.
Improve Driver Efficiency with Upper Route Planner
This is probably the best time to start a delivery business. The demand for commodities and services to be delivered at the doorstep is only going to increase in the near future.
Once you decide your niche and figure out what you will be delivering, you will have to set up an efficient last-mile process. We hope this guide will prove helpful to you in establishing a good last-mile process.
To support your last-mile delivery process and your team, you can try out Upper Route Planner. At Upper, we work towards making deliveries uncomplicated and faster for all kinds of delivery businesses.