In today’s sophisticated, technology-driven business landscape, people often tend to overlook the “low-tech” business model of knocking on doors and building relationships with customers one-on-one, but direct sales and door-to-door sales companies are still making good money in the digital age.
Lots of different types of vendors can utilize the time-tested method of door-to-door sales to sell their services or wares. Door-to-door sales companies might invoke images of a simpler, more casual sort of business entity, but they still require accurate record-keeping and compliance with relevant business tax codes, industry bonding and government regulation.
If you are planning on doing business door to door, depending on where you operate your business, it might be necessary to have a peddler’s license as part of your overall obligations of staying in compliance with applicable laws.
Here are a few key tips to keep in mind when considering if you need to get a peddler’s license.
Check with State and Local Authorities; Get a Surety Bond
Regardless of what state you are operating your business in, you might need a vendor’s or peddler’s license. Make sure you check with state and local authorities to satisfy all the requirements necessary in obtaining this license.
Every state government has its own set of guidelines that you will have to follow to get licensed, and some municipalities have their own requirements as well. In some states, you will be required to get a surety bond for you and any other employees that may be working for you.
A surety bond is essentially a guarantee that your door-to-door business will operate in accordance with local, state and federal laws and helps protect the government and customers alike from fraudulent business practices.
Your business must obtain the proper amount of surety bonding as specified by the state or local authority, and then pay a premium to the “surety” or bonding company. The “proof of bond” is one of several important pieces of documentation you will need before you are issued your peddler’s license.
Prepare Your Identification Documents
When you are applying for a peddler’s license, be prepared to submit several forms of identification. When you are putting together all of your documentation, contact the local licensing agency where you are applying, so you can get the specifics on what is needed to complete your peddler’s license application.
Generally speaking, you’ll need to have your “proof of bond” established and available, as well as any necessary identification documents when you formally submit your application.
State-issued photo IDs, as well as a proof of any criminal record, are commonly requested by the licensing agency when you are applying for your peddler’s license.
Bear in mind that if there will be any other people involved in your door-to-door sales company, they must be included in the application process as well. Make sure you have all of your paperwork ready upfront in order to avoid delays in getting licensed.
Apply Online or In Person
Some states will allow you to apply for a peddler’s license online, while others will only let you to submit an application in person. Check online or contact the relevant local agency to see what makes the most sense for your given situation.
If you must apply in person, make sure to bring your wallet. There is typically an annual fee that must be paid before the license is issued, and there might be an application fee to pay as well.
Some states will require you to carry a special peddler’s identification card. If you have any employees who will be selling door to door, you might be charged an additional fee by the state for issuing extra license cards.
Once you’ve satisfied all the necessary requirements, paid the amount owed to the government and are formally licensed, you can officially start knocking on doors and doing business.
Do Your Homework First
Since laws vary from state to state, it’s always best to “do your homework” before you formally apply for a peddler’s license.
Contact your local government licensing agency if you have any questions about getting your peddler’s license. You can make the process even easier on yourself by going online and making a few phone calls to get the most up-to-date information.
It’s always better to know what you will need in advance so you can avoid slowing down the process or making the application more arduous than it needs to be. Even though a door-to-door business has a relatively simple business model, getting properly licensed to operate one can involve quite a few different steps.
If removing the stress and uncertainty of the business licensing process sounds good to you, consider using Incfile's Business License Research Package. We do the hard work of determining what business licenses and permits are required for your particular business. We'll provide you with the proper applications, give you filing instructions and inform you of any necessary fees.
A business license keeps you in good legal standing with the local, state and federal government and is a necessary part of doing business. The Incfile's Business License Research Package will help you quickly get informed on how to obtain the proper licenses and permits you need, and let you focus on running your business.
Ben Gran is a freelance writer from Des Moines, Iowa. Ben has written for Fortune 500 companies, the Governor of Iowa (who now serves as U.S. Secretary of Agriculture), the U.S. Secretary of the Navy, and many corporate clients. He writes about entrepreneurship, technology, food and other areas of great personal interest.