The upside of owning a business is that you are your own boss. However, as enticing as calling your own shots sounds, developing a business and keeping it afloat is a feat that brims with responsibility. The first phase – of developing and growing your business – can be particularly strenuous. If you wish to get into the realm of vehicular trade, but you still lack the basic knowledge on how to start it up, here’s how to get a car dealership off the ground.
The Main Dilemma
If you want to develop your own car dealership, there is a main dilemma you have to clear up first – whether you will deal in new or used cars. Sit down and really think about this before you start tackling any other logistics – it will give you a basic framework, a business mission statement. Clarity is foundational elements of the business can truly boost your motivation to kick things off faster and in a concrete way.
Just be aware of the fact that your financial situation can determine this part for you. Starting a new car dealership comes with a substantially higher initial investment. Do not even try to go down this route unless you know you have several other investment sources. Check with your bank if you are eligible for some sort of credit program for people who want to start their own business. Don’t worry – you are not required to be well versed in business economics for your bank visit; as long as you are perfectly clear with your intentions, you will get all the help and clarification you need.
Space is the Most Precious Currency
When you start thinking about developing a car dealership, your strategy is all for naught unless you can find the right location. Suffice to say, considering you will be dealing with bulky machines on four wheels, you will need to accommodate your business with a lot of square footage. Be on a lookout for lots that can be rented near an intersection – or ideally right next to it.
In this case, even if the plot seems to be a bit unkempt, you should consider taking it. You can do a facelift of the lot by using concrete floor sealers and repainting the walls of the included facilities. Invested money can pay off big time in the long run. In other words, when it comes to car dealerships, space is the most precious currency and location is the biggest luxury.
If it is impossible to find the right location near an intersection, take a look at the lots on the roadside of high-traffic highways. These are sound alternatives, but also make sure the location is in the proximity of a larger population so the chances of a good turnover are increased. Finally, try to avoid situating your car dealership near another one, if you can help it – for the obvious reasons. With these parameters in mind, you’ll be well equipped to pinpoint at least several “golden spots” for your business in the area.
Of course, having a mission statement, a plan and a location is not enough to start a business. There are a number of administrative duties you have to deal with before you become eligible to deal in cars. First of all, you need a dealer’s license which will give you a carte blanche to sell an unlimited number of cars annually. It is also important to point out this license will put your activities fair and square within the appropriate safety laws that protect both you and the buyers.
When it comes to insurance, it is absolutely crucial to get comprehensive coverage for your dealership – and it should include general liability, property damage, lot insurance and inventory loss. Ask other experienced businessmen for advice when it comes to additional items on your insurance document. Considering how much you are investing, you’ll want to be as safe as possible.
Finally, do not forget to draw up a surety bond for your business – it is not exactly the same thing as insurance but is equally important. It is practically a written guarantee of payment in case of complications between two parties that strike a deal. In other words, it protects you from being cheated out of money. They will protect you from contract defaults with vehicle suppliers and wholesalers.
Loving automobiles can be more than a passion – if you play your cards right, it can be a way of life. Developing and maintaining a car dealership, especially if you are a people person, can truly be your doorway into entrepreneurial heaven. The upside of such a business is that the market is getting bigger every year and a staggering variety of potential consumers are in constant search for a new car deal. If you approach the work with the same passion you have for the four-wheelers, there is no reason not to create a stellar dealership business on your own terms.