Bikes are an awesome business vehicle! There are lots of different businesses that can be operated by bike, such as:
courier and delivery services
pick up services
They are a very economical fleet vehicle to operate, which means you can pass the cost savings along to your customers in low prices and your employees in living wages. Add to that that the satisfaction that your business will be supporting community and transportation alternatives in your city but also contributing ZERO carbon emissions to our global ecosystem!
I have been working to build up two bike based businesses in Athens Georgia, a residential curb side compost pick up service: Vulture Cycle and my bike advertising service, Pedal Promotion.
1: Mechanics 101
If you’re gonna run a bike based biz having some basic knowledge about how to fix bikes will go a long way to keeping you running on schedule. Having to stop and take your bike to the shop will stop work getting done and cost extra money. Having a basic understanding of how bikes work will allow you to avoid equipment problems. Plus, working on bikes is easy, and the tools are not very expensive. You can learn by watching videos online, going to your local bike shop and taking a Mechanics 101 class, or just get yourself a junker, take it apart and put it back together again in an afternoon.
Make sure that you have basic tire repair tools with the bike when it is out on the road working. Why get stranded and have to stop work because of a flat that could be fixed with about $40 worth of supplies on board. Have new tubes, tire wrenches, axle wrenches, a patch kit, and a pump.
2: Carts & Hitches
If your business is going to use carts, the hitch connection of the cart to the bike is very important. I would highly recommend that you use a fixed axle, not a quick release rear wheel and bolt your hitch connector to the bike if that is the type of hitch you decide to use. Other wise the weight of the cart will pull on the axle, and pull the wheel out of true. The caveat with this is that if you have multiple riders using the same carts they would have to use a wrench to take the hitch mount on and off when they use it. I personally prefer the Classic Burley hitch for my advertising business. It mounts to the frame of the bike, not the wheel, it is easy to take on and off for different riders and it can handle a lot of weight. It does have a tendency to rub on the frame, so I made a sweater for my bike!
Another note about carts is that if you are hauling weight, like we do for the compost pick-up service (100+ pounds of compost per load, 8-10 loads a week!) the cart needs to have an axle that crosses the entire frame. Other wise the cart wheels are going to bow inwards under the weight.
3: Work the Law
Bikes are vehicles under most state laws, and the riders are responsible to follow the rules of the road when operating a bike. Use the basic hand signals and go with the flow of traffic. Only pass on the left unless there is a bike lane. Be Visible. Be Predictable. Ride Right. Ride Bright. Report altercations with motorists to your local police to help with them gather of data about bikes and cars on the road. Data can do a lot to help drive improvements to bike accommodations and transportation infrastructure by your local government. If you are so inclined, write a letter to your Mayor and Commission, and/or your local Transportation Planning Department about your business and reinforce the need for bike infrastructure in your community. Your local government has meetings monthly, and are open to receive public comment. If you really feel inspired attend one of the meetings and let your elected officials know that you are operating a business that generates economic development, you are paying taxes, invigorating community, and you would like your government to make improvements to support bikes and pedestrians!
4: Insurance, Taxes, Bikes & Bikers
You can insure your bikes as equipment for your business. Most insurance companies will add bikes to an existing auto insurance policy.
If you plan to employ multiple bikers there are two options:
They can be an employee, in which case you are responsible for providing the equipment, you control the schedule and the scope of the work, your business insurance needs to cover the liability of them getting hurt as well as the equipment, and you are responsible for their taxes. They would fill out a W-2 for you for tax purposes.
They can be independent contractors, in which case they are responsible for providing their own equipment, they must be free to accomplish the work at a schedule that they choose, they can hire someone else to do the job for them, they are responsible for their own insurance to their person and their own taxes. They would fill out a W-9 for you for tax purposes.
For either option a description of the job and the responsibilities of each party (business owner and employee/independent contractor), can be described in a Memorandum of Agreement or Understanding, to be signed by both parties. Having a very clear signed agreement between your business and bikers working for you, especially if they are independent contractors, could be very important if you get audited or need to go to court to settle a dispute.
5: Route/Team Management
If your business operates on routes there are a few mapping/routing services online that are great for bikes: For the compost pick up service we use “Route 4 Me”, and for the advertising service we use “Map My Ride”. Both of these have an app that can be used on phones of bikers so they can keep up with where they are going while they are going.
There is another great online service for group communication called “Slack”, which really helps to co-ordinate biker teams in a text message format. You can create a team for your business, and each member has their own name and can communicate with the whole group at once, or individual members of the team.
6: Legit paperwork
As far as the rest of the paperwork to get your business up and running, it’s really depends on the type of business as to how to proceed to engage with state and local government to get legit. You may want to run a sole proprietorship, a General or Limited Partnership, an L.L.C., and S or a C Corporation. Some business structures are more complicated than other, requiring different legal agreements between parties and different tax obligations. Both the compost and advertising businesses are L.L.C.s. If you decide to become an L.L.C. it is accomplished through your Secretary of State’s office. This is also a way to officially be doing business under your business name anywhere in your state, but it requires annual registration. If you just want to operate in your town you can register a trade name or business name at your local court house, publish an ad in the newspaper and for (usually) a one time fee you will have the paperwork to apply for your business license, which you renew annually. Instructions on how to obtain a federal and state tax ID number are easy to find online, and you will need these as well to start your business. For some bike based businesses, since your real work will be done out on the road, all you might need is a home office, and your local government would issue your business license as a home office/occupancy permit. There may be restrictions on having equipment related to your business stored at your home, in which case renting a storage unit for your bikes and including your rental agreement with your application is the easiest way to meet the requirements. If your business involves food there will be a whole ream of requirements related to food production and packaging aside from the bike part of the operation. For instance, the composting facility where we take the food scraps picked up on bike is a separate animal from the bike part of the business. For the advertising business there are no regulations about signs moving on bikes in the public right of way in my town, but other towns may have rules about the types of displays allowed in public spaces, if for instance your stop and park the bike for any length of time, etc. Check with your local government with specific questions. The expression “It’s better to ask for forgiveness than permission” is not the advice to follow when it comes to getting your permits, licenses and paperwork straight! Break it down into a step by step process, and ask lots of questions.
7: Pricing your Service
There are any number of ways to charge/pay for your bike powered services, it’s really up to you and your business. The compost service charges customers a monthly fee, pays by the stop, so the faster the biker goes to get the route done the more they make an hour. The advertising service charges and pays by the hour, and we want riders to go slow, stop and take breaks so people can see the signs and engage with the cart, pick up flyers, etc, and we have figured out the average amount of time it takes to travel a route, with breaks. The average rider travels between 10 and 15 miles an hour, but it’s really up to you to find the best relationship between cost to provide your service and an rate to change for it. Just remember that your bikers are putting their lives on the line getting out on the road to work for you. That’s even more of a reason to advocate for bike and pedestrian safety in your town! Make sure to pay them well for their work. It takes a special person and a committed cyclist to do a god job as a professional biker. Working with the right people is key to the success of any small business, and that is all the more true for a business that needs great bikers. Take care of your people!
Have fun and Enjoy the ride!