Advice on becoming an auto dealer

[HTN]

R.E Broker here. Business has been... you know. So I'm thinking about buying and selling cars for some extra revenue. I'm looking at turning less than 10 cars a year.

Any advice on going this route? Since I switch out cars so frequently, perhaps this will also offer me the chance to try out different cars and making a profit. I am targeting cars in the teens. Nothing expensive.

Just so thoughts right now. Please let me know what you experts think.

Thanks.

 

[Dtrigg]

Check the laws in your state for obtaining a license. My buddies and I looked into doing the same thing when I lived in North Carolina. We were all retired and looking for something to have fun with, and be able to drive a lot of cars.

Found out we had to have an actual location, parking for a minimum of xxx amount of cars, had to be open at least 40 hours per week, etc., etc.

We are retired and wanted to have some fun, not get a job. Needless to say, we blew that off.

Oh, also check you local zoning law. It's extremely difficult to find a location to open a facility. No one wants a used car dealership in their neighborhood.

Good luck.

 

[NetViper]

I have a program that is $299 that will help you manage your inventory and get it up on craigslist. Might be of some help as it targets the $$$ you are looking for from your clients. Of course, it depends on how many cars you want to keep at a time. Let me know if you are interested down the line Where in Florida are you?

The Dealers in JAX are all hurting around here. I am having a lot of trouble just getting dealers to call me back since they are in CUT CUT CUT mode even though my program is so cheap.

I just met with a company that does Buy Here Pay Here in the $15,000 and under cars. They are having to close stores and lay people off, not because they are having trouble selling cars, but they cannot get more loans to buy new cars to replace the ones they sold!

 

[sahtt]

You are getting in the same business. It's reliant on the credit markets and the market is absolutely flooded in every measurable way. Cash cars are all that are moving.

You can get a dealer's license pretty easy in most states but you need a commercial property address.

Personally I'd wait for the economy to turn around, as an experienced player in this game I'm on the sidelines after a lot of success in 06/07. Late 07 the market f-r-o-z-e. Took me 3 months to sell a sport bike.

 

[DRIFTER]

At less then 10 cars a year the business will cost you money. Especially with the way the economy is, no 1 is buying crap.

 

[HTN]

Net Viper... I will definitely contact you once this is up and going.

You guys make some really good points.

Dtrigg... I am thinking the same path you once had in mind.

Sahtt... I have been on the side line for over year already. So tired of feeling unproductive. (in terms of making $$$) I agree with you and Drifter on nothing is moving.

Please keep it coming. I value all opinions.

 

[Ko-nsx]

I did it for 7 years.
If you don't have a way to finance people and get their trade in's, then the associated overhead will wear you down.
Going to the dealer auction to find cars was good at first then ebaymotors exploded. I tell people i made more money buying and selling from the local newspaper. This is not a good time to be sitting on fast depreciating ANYTHING. good luck:smile:

 

[DRIFTER]

I keep my dealer license as mainly a hobby. I make some cash, hear and there. I try to keep my over head to a minimal allowing me to do it at my leisure. I advertise threw free internet sites, and word of mouth. Its not something that is going to pay the bills, but it dose allow me to me to purchase new stuff for my car and not feel guilty (Play money). It is a lot of work and can be aggravating at times dealing with all the tire kickers. But it is something I enjoy.

 

[warren1205]

I was a used car dealer owner before and from my experience 10 vehicles a year will not work out. Some states do issue licenses without a lot. next you need a bond. anything over 10 cars a year is a min 50k bond. anything under 10 a year is 10K bond. You would have to take a written test at the dmv along with a 8 hour mandatory course (ca i don't know about other states). My best advice is buying vehicles from auction are not good most of the time. You have 30 dealers bidding on the same car. When i purchased my vehicles i was pretty fortunate to have good connections buying vehicles directly from the source, dealer trades and directly from bank repos. if you want to sell on the side under the radar. Try buying vehicles from private individuals and make sure to keep the title/pink open. When you purchase the vehicle tell that person the truth, your buying this car to resell so please don't send in the release of liability to the dmv and that you'll send it in as soon as you find another buyer. Or come up with some excuse to hold off because your don't know in who's name your going to register it under. If the dmv has your name in the system too many times from people sending in the release of liability, you can be fined.

 

[sahtt]

Remember if you don't have a license and you title it in your name you owe the taxes. This will massacre your (potential) profits. I tried that for a while. Not a good idea.

 

[warren1205]

Deffin don't do that. Keep you title/pink slip open (nothing written in the buyer section, but a signature from the seller only) at all times!

 

[HTN]

Great pointers Warren. Not to go off subject here. I remembered your post back a few months ago about landing a new gig. Hope you're doing well.

And yes... these are the things I've been thinking about and how to operate legally and turn a profit. I've purchased and sold many cars "by owner" in the past and really have fun with it. I guess trying to turn a profit is a whole different story.

 

[warren1205]

not so well my friend, the gig never went through.. :frown: Anyways, if and when you do sell vehicles. have them go through a safety inspection. it should be about 25-45 bucks a pop. You sleep better at night just in case shi* happens. One way to start getting some cheap good little money makers is to go to dealers introduce yourself to the salesman and tell them to keep your phone number and call you when there is a trade inn that is owned free and clear and that you will pay him 200 bucks on the side if you make the purchase. Dealers steal cars like that every day.

 

[HTN]

Warren you got pm'ed.

 

[Cairo94507]

Try buying vehicles from private individuals and make sure to keep the title/pink open. When you purchase the vehicle tell that person the truth, your buying this car to resell so please don't send in the release of liability to the dmv and that you'll send it in as soon as you find another buyer. Or come up with some excuse to hold off because your don't know in who's name your going to register it under. If the dmv has your name in the system too many times from people sending in the release of liability, you can be fined.

UHHHH.....one might want to seriously re-think this type of activity. DMV investigators (cops) would be all over you and multiple felony charges would follow that scrutiny.
As a private party, if someone approached me and made that request, I would dime them out to DMV and ALSO complete the Release of Liability form immediately and send it in, keeping a copy. Otherwise the seller could become complicit in the fraud being suggested here. Just my thoughts for what they are worth.

 

[SOURCE 1]

Been in the business for over 15 years. Ownign several lots. Unless you have alot of cash and can finance the cars yourself it is tough to get deals right now.

I to am in the real estate field also so i feel your pain. The car biz is about the same. Used cars are impossible to get at the prices I was paying a year ago. No trades from big dealers because no one is buying new cars. Auctions are nuts with prices!

If you want to pursue it you can email me and I will be glad to discuss.