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Dealing cars does not necessitate a formal education, but it does necessitate some instruction. The stages to becoming an automobile dealer are outlined in this list.
1. Conserve your funds. Almost every step on the road to becoming a vehicle dealer will be costly. Your costs can range from $30,000 to $1,000,000 or more, depending on the type of business you want to run and the amount of inventory you plan to keep.
2. Get a dealer's permit. Each state has its licensing standards for auto dealers, which typically include taking a course and passing a certification exam.
3. Refresh your business knowledge. Being a car dealer, like operating any business, necessitates a basic understanding of bookkeeping, inventory, accounting, marketing, administration, and customer service. You don't need a business degree, but you should go to the library or go online to learn everything you can about running a firm.
4. Decide how you want to run your company. Because being a vehicle dealer entails being self-employed, you'll need to ask yourself a lot of questions before going on to the next phase. Here are some things to think about:
Would you wish to operate completely through a company website as a one-man show?
Are you looking to sell a new or used vehicle?
Or would you rather own a large number of properties and hire salespeople?
How many and what kind of staff do you require?
Will you provide in-house financing or will you require your clients to seek their own?
How will you promote your company?
How much money do you have to invest and how much do you need to earn?
5. Construct a comprehensive business strategy. Once you've decided what type of vehicle dealer you want to be, take the time to write down every detail of your business strategy. This will assist you in sticking to your budget estimates and business-building goals.
6. Decide on a location. This may be as simple as parking a few cars in your driveway and creating a website to act as your business address, or it could entail looking for commercial lots and office space. To proceed to the following step, you must receive a zoning verification letter, regardless of your location.
7. Obtain a surety bond. You must obtain a surety bond after confirming that your business location is correctly designated for a car dealership. The auto dealer bond is issued as a guarantee that your business will follow all state rules. The bond amount can range from $5,000 to $100,000 depending on the state, but you will only have to pay a percentage of this amount, which normally ranges between 0.75 percent and 10%.
8. At the Division of Motor Vehicles, register your business name and obtain a business license.
9. Create an inventory. As a car dealer, you have access to private wholesale dealer auctions where you can buy vehicles for less than market value. You can also buy wholesale using closed-bids at new-car dealerships.
