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Perhaps you own a drone for fun and want to turn a passion into a career and you’ve been wondering how to start a drone business. Or maybe you would simply like to get in on a hot new business venture that doesn’t involve blockchain or non-fungibles. Whatever your motivation, one thing is for certain: when it comes to drones’ money-making potential, the sky is the limit.
According to Statista, the Chinese drone market was expected to generate the highest revenue worldwide in 2022 at around 1.27 billion U.S. dollars. The United States and France followed with 1.24 billion and 150 million U.S. dollars in revenue, respectively.
And while you might think that breaking into such a hot market is reserved for the wealthy or close to impossible, the truth is, becoming a Drone Service Provider (DSP) is not as out-of-reach of a goal as say personally rocketing off to space.
Why Start a Drone Business
Industry growth aside, a drone business can offer entrepreneurs numerous opportunities. The variety of potential services that drones can offer also provides a sense of job security. Look at it this way, if one market gets hit, you may be able to pivot your business model to cater to another. Plus, drone businesses require little startup costs, that is if you want to start small and grow overtime. And it’s an evolving market that’s exciting to be a part of.
Drone Business Ideas
Drones, also referred to as unmanned aerial vehicles (UAVs) are being used across all kinds of industries. Construction, real estate, agriculture, food delivery, insurance, energy, cinematography–the list goes on. Entrepreneurs are using drones to conduct home inspections, parachute-drop packages and shoot award-winning photography. And beyond direct to consumer drone services, you may also want to get into a B2B drone venture of providing repair services, flying lessons, or niche app development that caters to the drone market.
Remember what we said about the sky being the limit when it comes to drone business opportunities? Well, yeah that.
10 Steps for How to Start a Drone Business
Okay, so the potential is there and the question of why answered–but what about the how? When it comes to starting a drone business, some steps are similar to any startup or entrepreneurial endeavor, but others are unique to the drone world, such as customized drone insurance. Take a look:
1. Get Certified and Register with the IACRA
As an average everyday person, you don’t need a license to fly a drone. In fact a toddler can operate one on their own if they like–even if it means that landing involves crashing it into a tree. But, it’s important to know that there is a difference between recreational and commercial drones. As a DSP you must follow certain rules and regulations.
In the United States, for example, before commercially flying your drone or drones, you must take and pass the Part 107 exam in order to obtain a FAA Part-107 license. You must register or obtain your FTN on the IACRA website before scheduling your FAA knowledge test. It should take you about 20 hours to study for the test and costs $150 to take the aeronautical knowledge exam. You’ll need to choose an approved testing center and receive a passing score of 70% or higher.
Once you submit your Part 107 exam score you will finalize your application and submit your Part 107 test score on IACRA. You’ll get a permanent Part 107 certificate anywhere between one – three months after receiving your score and you must pass a biannual flight review every 2 years after that.
2. Check Federal and State Regulations
Some countries have already introduced strict regulations that limit the use of drones. So it’s important to look up specific rules and regulations attached to your specific region or state. Again, remember local regulations for commercial use of unmanned aerial vehicles (UAVs) will differ from recreational use cases. And while there are no specific FAA drone rules prohibiting certificated drone pilots from flying over private property, some local laws have been put into place that do limit where commercial operators can fly. If you plan to operate your business out of the US, here is a list of drone regulations by state.
3. Decide on a Drone Business Type and Structure
As mentioned earlier, one of the benefits of running a drone business is getting to choose from a variety of markets. When getting started with your business you’ll want to conduct a market analysis within your area of operation. See what other drone companies are targeting and determine if you would like to improve upon their model and offering and act as a competitor or go after a different market all together. You can determine which new drone offering to go after by conducting a consumer survey and zeroing in on your target market.
4. Purchase and Register Your Drones and Equipment
Professional drones can cost anywhere from $1,000 to $20,000 each. In order to get started, you’ll have to have at least one drone.You may want to start out by renting a few if you want to lower your initial investment and startup costs. It is important to note that [In the US] any drones that weigh over 0.55 pounds must be registered with the Federal Aviation Association. So be sure to do that with any drones you plan to use for commercial use. And you’ll also have to stock up on other operational equipment including batteries, propellers, and cases.
5. Obtain Liability and Drone Insurance
Like with any business, it’s not only wise, but necessary to have insurance. Drone accidents happen and your own property can become damaged or even lost during the in-flight process. And even worse, someone else may experience damage to their property because of a drone mishap.
Drone insurance consists of liability insurance and hull insurance. Liability insurance tends to carry high premiums and provides the greatest amount of coverage in the case of 3rd party damage. And hull insurance helps protect your property and can cover damage to the drone and any operating equipment. Here’s all you need to know about how to properly insure your drone business.
6. Equip Yourself and Staff With Advanced UAV Training
A drone is a product that requires a certain level of expertise to operate. Beyond acquiring the necessary certifications to fly, consider having yourself and your staff receive additional or advanced UAV training. This can become an added benefit to your customers and help to set your drone business a part from the rest.
7. Create a Pricing Structure
Once you know what services you want to provide, you’ll have to decide upon a pricing structure. You can choose to price by hourly or daily rates. Or you may want to charge per project or go on retainer with a regular customer. Long-term service contracts can provide your own business an advantage because you will have work you can count on and you’ll be able to staff accordingly. You’ll also want to decide on a billing cycle and communicate that out to clients in a clear and regulated way.
8. Decide on Standard Business Operations
Because drones are not super cumbersome to store, you may not require a large physical location to run your business out of, unless you feel that your customers’ could benefit by engaging with a storefront. That being said, even if you decide to run a remote business, you will have to consider how far will you travel with your drones to execute on actual work. Further, you’ll want to keep track of your flight records and keep tabs on info like total aircraft flight hours and maintenance logs.
9. Create a Website and Marketing Plan
Of course, no matter how equipped you are with excellent drones and qualified staff, no-one will know you exist without some good old-fashioned marketing. You’ll want to develop a website and even an app if possible. Post your portfolio on social media platforms and connect with complementary businesses who serve your target market and ask them to engage with your pages. And keep reading for more tips around creating an aerospace marketing plan for your drone business.
10. Be Active in the Drone Community
Drones as a product are going to continually evolve–as will the market. Stay on the pulse of change by being involved in drone communities. This will help you be better aware of trends and changes that are in demand. Don’t be afraid to adjust your business approach, being agile and adaptable is one way to continue to thrive in this growing and competitive space.
Drones are great. And starting a drone business might be a smart, surefire decision for some. Still, there are challenges and cautions to yield to, as with the startup of any business. Take a look at common startup mistakes and avoid the common pitfalls many entrepreneurs encounter along the way to better set your business up for success. And to mitigate the risks of your new venture, insure your drone business with a robust policy.
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