How to Start Dealerships
Starting a dealership which sells either new or used vehicles can be a lucrative business. Dealerships require a large investment intially; however, the return can be great. To start a dealership, you must first contact your state's Department of Motor Vehicles (DMV) to determine the necessary requirements.
- Open a corporation for the business. A corporation is its own entity and will protect your personal assets in the event of failure or a law suit.
- Obtain your dealership license. Contact the Department of Motor Vehicles (DMV) in your state and ask what is required to open a car dealership.
- Contact lenders who specialize in financing automobiles. It is a good idea to have several lenders to work with who deal with different levels of credit. The more financing options you have for your clients, the more sales you will generate.
- Choose a location for the dealership. A large lot is needed to keep inventory and a small building is needed to house offices for salespeople and managers. Check with zoning laws before signing a lease or purchasing the property.
- Set up all utilities and phone services.
- Purchase signage and business cards.
- Furnish the office space with needed equipment such as computers, printers, faxes, copy machines, tables, chairs, filing cabinets and other furnishings. Don't forget about a waiting room.
- Obtain car inventory. If purchasing new vehicles, contact the manufacturer, they often give special financing agreements to dealerships. If selling used vehicles, a car auction is a great place to acquire initial inventory.
- Advertise the dealership in local newspapers and car magazines. Develop a website and host pictures of current inventory and special sale incentives.