Want to learn what it takes to make money in the used car sales business? This guide maybe just what you need.
Here are a few key points you need to know before you open a used car sales lot:
- Every state has a different set of rules and regulations, some states are tougher than others – some are more lenient. Either way, your state laws will affect your overall sales. So, it’s important to learn and keep a copy of the laws regarding car sales in your state.
- Each state is different in that there are limits to the amount of cars that can be sold legally before you have to apply to get a car dealers license from the Department of Motor Vehicles in your state. You need this before you open a used car sales business with a lot.
You’ll fill out an application and take a few tests, and the approval can take up to a week before you can move forward with buying/renting your car lot.
Once you’ve done 1 and 2 above, you need to look for commercial property to rent. Look for high drive by traffic areas in a moderate speed zone so your prospects can slow down enough and see what you have and can react fast enough to pull-in. Be sure the lot is flat and paved.
There’s unnecessary risk purchasing a lot you don’t know will produce, so I always recommend you lease it first with option to buy to know if it’s a profitable location before you make the decision to purchase the property outright.
At this point, you have your dealers license and found a good lot, next you need a surety bond worth at least $30,000 in coverage. This protects your customers from hidden problems and every state requires it.Once you’ve spent a few weeks taking care of legalities, you can start buying inventory for your new used car sales business. Wholesale car auctions in your state are great places to get your initial inventory. You’ll find all types of cars to showcase on your used car lot.
You can also find quality vehicles at police auctions, private auctions, garage sales, estate sales, Craig list, and eBay motors.
Also, decide if you want to deal with taking trade-ins. You’ll have plenty of inventory, but some of these cars could have hidden problems you don’t want to deal with. Because your taking on extra risk, you want to be sure you spend very little money acquiring trade-in’s and get routine inspections before you give cash.
When evaluating the trade-in value, keep a Kelly Blue Book on hand to help you determine the value of a vehicle and what it can be sold for at a reasonable price.
Now you know how you can start making money in the used car sales business with this useful and practical guide on making money in the used car sales business.
You have no excuse now but to get to work, and put this information into action for yourself so you can start living the life you want – on your terms.