Setting Up A Profitable Used Car Business

All that you really need to start a used car business is a used car and a means to sell it. Realistically, however, you will want enough capital to be able to invest in a number of cars, experience or knowledge in the used car industry, and a network of strong relationships with suppliers and service providers. You should also ensure that you have appropriate insurance policies in place, and either an astute business and financial brain, or an employee or service that can provide access to this astuteness.


Many business start small and build up to become national or, at the very least, large local businesses, and this is equally possible with a used car business. In fact, because most buyers will want to see and test drive a car before they purchase it, there is the potential to maintain a small business even as your dealership ages. Alternatively, you can grow and evolve into something bigger, with thousands of cars in stock, making use of software (which you can find more info about online) to keep track of as you continue to grow.

Also, to generate business funds and sponsors, you might have to create a partnership with other small businesses such as mechanics, car repair services, hail damage repair, spare parts dealers, etc. While selling used cars, you probably have to do some repairs, and a few parts might need to be changed, for which those partners could be beneficial. You might want to appraise a car dent repair facility that can provide an exclusive service called PDR (Paintless Dent Repair). Paintless Dent Repair can remove all dents and dings made from hail damage and can be quick and cheap, depending on the extent of the damage.

Always ensure that you have the financial and business side of the company covered. Legally you will need appropriate insurance policies, which include policies for business premises, policies for any employees, and you will likely need insurance that permits your potential customers to take your cars on a test drive. Financially, you will also need to keep on top of taxes, maintain financial records, and you will need to ensure that you are buying and selling at appropriate price points to maintain a healthy profit level for your business.


Establishing working relationships with other businesses can also help. Auction houses, main dealers, and even businesses like taxi firms, car rental companies, and the police may be able to supply you with inexpensive vehicles, especially if you have the capability to be able to fix and maintain cars yourself. Other suppliers, including parts manufacturers, and service providers like TNT Direct who can deliver parts, manuals, and even assist in the distribution of marketing material, can prove vital to the running of a successful business.

There are many elements involved in running any small business, and you can start with a stock of a single car and increase the size of your inventory as you make more and more profit from the sale of your cars. You can use websites like AutoTrader and even Ebay Motors, as well as selling locally, and you can look to develop long term relationships to sell cars in quantity – it really is up to you how your business develops and evolves.