If you’re looking to start a new business, a car dealership isn’t a bad idea. Most people need a car to get to and from work or to run errands, and buying and selling used vehicles is a great way to make some income with reliability. If you’re completely new to the concept of starting your own dealership, there are a few key components to get right if you hope to have success. Check this list to see everything you need to know about starting a used car dealership.
File your business and register for insurance
In order to be recognized as an official business, you’ll need to register and file the proper forms. While you’ve probably already accounted for setting up your own business bank account and registering as a business in your state or city, you may not have completely thought through the different kinds of insurance policies that you’ll need to protect your business interests. This includes workman’s compensation policies for your employees, as well as insurance to protect your inventory. Particularly if you’re thinking about letting customers test-drive your vehicles, you want to make sure that you’ve purchased a policy that covers you appropriately.
Purchase a car lot where you can operate
In order to sell and house your wares, you’re going to need an appropriate place to operate your business. Of course, used cars take up much more space than items like clothing, which is why so many dealerships have large lots where they can display their cars. Keep in mind that you don’t have to put all of your cars outside; it’s just as useful to have a larger garage with only a few vehicles outdoors. That being said, curb appealis important for a dealership. Whether you have glass panels that reveal some of the vehicles inside your building or store the bulk of your inventory outdoors, keep this in mind in order to create an appealing storefront. It’s also worth noting that you will need some interior space for individuals to fill out paperwork, process purchases, and use the bathroom.
Find good inventory
When sourcing cars to sell, you’ll want to make sure that you find cars that meet a broad array of needs. Keep in mind that not everyone has the same taste in cars, nor do they have the same requirements when shopping for a vehicle. Families will need more seats and trunk space, while others will care more about safety features or gas mileage. Of course, in addition to having a variety of cars to sell, you also need to make sure that you can turn a profit on them. One way to do this is to look for repo cars for sale. Repossessed vehicles are often newer leases that someone has fallen behind on payments for. This can help you build out your inventory without sacrificing quality.
Don’t forget about your taxes
Once you’ve launched your dealership and are approaching the end of your first year, you’ll breathe a sigh of relief. Take this time to pat yourself on the back! Once you’ve congratulated yourself, though, make sure that you’re getting yourself set up for success in the future by filing your taxes and getting your insurance coverage renewed. You’ll also want to get your employees their tax documents so that they can file their own taxes. If you want to go the extra mile, you may want to use some of your profits to buy branded tax envelopes, folders, and more. This can ensure that your employees receive their income tax information in an envelope that clearly establishes they’re from your dealership. It also helps you begin to think about other materials that you may want to brand to further establish your dealership in the coming years.