Throw out those old stereotypes about car salesmen.
Opening your own used car dealership is one of the best ways to earn honest cash—and a lot of it. Just one car sold can put thousands of dollars into your pocket.
But opening a used car dealership requires a few steps and basic tips.
Read on for the top five tips to follow when opening local used car dealerships.
- Get Licensed
If you’re like many, you may have already sold one of your own used cars in the past. But building a business around selling cars can require licensing.
First, you’ll need to register your business. Choose what kind of company you’ll be running, such as an LLC or partnership.
Then, check what licensing requirements exist in your area. Some locations require a special license for car dealers. You must also follow federal guidelines for dealers.
- Choose a Retail Space
Next, you’ll need to choose a location to store and sell your cars. For some, renting or buying a retail space can be one of the most expensive costs of running a business.
Still, you shouldn’t skimp in order to save. Put thought into the location you choose. Notice if there are several other used car dealers around. Sometimes, competition can drive down prices.
You should also choose a location that is easily accessible, ideally near a major street or highway. That way, drivers who are in desperate need of a new car will flock to your dealership.
Finally, consider the demographics of the location. While any community could benefit from a used car dealership, the type of cars and price points may attract—or repel—certain customers. Try to situate your retail space near your target customers.
- Pick a Vehicle Niche
Before opening your own dealership, narrow down the vehicles you’ll sell to a specific niche.
For example, you may only sell luxury used cars, or you might choose to only offer a specific brand of car. Having an easily identifiable niche can help boost your auto sells because people will come to you for that exact type of car.
- Stock Your Used Car Inventory
To open a car dealership, you must have sufficient inventory. And you’ll need to know where to get it.
Many used car dealers start out by buying their inventory online, at auctions, or through local listings. Depending on the size of your dealership, it’s best to have at least around a dozen cars when starting out.
- Promote Your Dealership
Car dealerships need some careful marketing to stay afloat, especially when they’re new.
Though you might think being visible to people in your local community is enough, it’s actually a smart idea to invest in a website and online presence. Many who are looking to buy used cars will search online first before driving to your retail space.
That’s why you need a good SEO strategy. Learn more about SEO and how to rank high in search results here.
Open Successful Local Used Car Dealerships
Local used car dealerships can be lucrative businesses with a little planning. Use the five tips discussed here to open your own successful dealership.
For more tips on buying and selling cars, check out our latest articles!