starting a car dealership
Discussion
slipstream 1985 said:
depending on when you passed your test you may need to sit a seperate test for using a trailer
And a tachograph. Anything that can carry much more than a focus/astra will need to have a tacho in the tow vehicle. (remember it is what it CAN carry, not what it IS carrying) You can do what you like at the weekends for private use. However business use has a whole different set of rules. It is worthwhile checking the rules before committing to using a trailer or flatbed. POORCARDEALER said:
Right here is my take, changes day to day depending how many we have sold 
In the current climate IT/website is hugely important...here is a stat to consider....In the year 2000 the "average" car buyer visited 7.5 showrooms before purchase, today the figure is 1.4....What does that tell us? People are not doing the rounds of showrooms to find something they "fancy"...the buying decision is made from home. I am about to have a all the bells and whistles website built, goes against the grain with me as I am an old school motor trader, however embrace or die.
New website will have video,live help, up to 50 hi res photos, instant finance quotations against all stock, direct feed into finance companies for proposals, direct info feed to twitter, facebook etc etc...There is a lot of work involved in doing this, I may have to employ a full time web person to do the videos/websites.
So the person at home has come to my super website, looked at the vid, pics, dealership profile, arranged his finance,bought an extended warranty, does he care if he is buying from a high street garge or a tidy industrial unit, or even home premises .... I think if it is proffesional looking most dont care.
Summary...get a dogs b
ks website built, dont have the overheads that a showroom brings, you will work 14 hour days but at the end of it you just might earn a living!!
+1In the current climate IT/website is hugely important...here is a stat to consider....In the year 2000 the "average" car buyer visited 7.5 showrooms before purchase, today the figure is 1.4....What does that tell us? People are not doing the rounds of showrooms to find something they "fancy"...the buying decision is made from home. I am about to have a all the bells and whistles website built, goes against the grain with me as I am an old school motor trader, however embrace or die.
New website will have video,live help, up to 50 hi res photos, instant finance quotations against all stock, direct feed into finance companies for proposals, direct info feed to twitter, facebook etc etc...There is a lot of work involved in doing this, I may have to employ a full time web person to do the videos/websites.
So the person at home has come to my super website, looked at the vid, pics, dealership profile, arranged his finance,bought an extended warranty, does he care if he is buying from a high street garge or a tidy industrial unit, or even home premises .... I think if it is proffesional looking most dont care.
Summary...get a dogs b
ks website built, dont have the overheads that a showroom brings, you will work 14 hour days but at the end of it you just might earn a living!! Thats the route i forsee. My next major outgoing is likely to be a small unit in an industrial estate for viewings and handovers - but currently its working well either meeting people somewhere mutually convenient, taking the car to them or having them come to my house. Currently with my website, advertising on gumtree each day (free) and 12 slots on www.usedcarsni.com (£75 a month) I'm averaging selling around 25 cars a month. One in three calls leads to a viewing. 80-90% of viewings lead to a sale.
My website cost me £180 all in and is generating the sales i need at the moment - its not currently a limiting factor for business growth for me.
daemon said:
POORCARDEALER said:
Right here is my take, changes day to day depending how many we have sold
In the current climate IT/website is hugely important...here is a stat to consider....In the year 2000 the "average" car buyer visited 7.5 showrooms before purchase, today the figure is 1.4....What does that tell us? People are not doing the rounds of showrooms to find something they "fancy"...the buying decision is made from home. I am about to have a all the bells and whistles website built, goes against the grain with me as I am an old school motor trader, however embrace or die.
New website will have video,live help, up to 50 hi res photos, instant finance quotations against all stock, direct feed into finance companies for proposals, direct info feed to twitter, facebook etc etc...There is a lot of work involved in doing this, I may have to employ a full time web person to do the videos/websites.
So the person at home has come to my super website, looked at the vid, pics, dealership profile, arranged his finance,bought an extended warranty, does he care if he is buying from a high street garge or a tidy industrial unit, or even home premises .... I think if it is proffesional looking most dont care.
You are doing remarkably well for the amount of advertising you do. Not sure if the market is better in NI than here, part of the problem for dealers is too much choice for the consumer.
Summary...get a dogs bks website built, dont have the overheads that a showroom brings, you will work 14 hour days but at the end of it you just might earn a living!!
+1In the current climate IT/website is hugely important...here is a stat to consider....In the year 2000 the "average" car buyer visited 7.5 showrooms before purchase, today the figure is 1.4....What does that tell us? People are not doing the rounds of showrooms to find something they "fancy"...the buying decision is made from home. I am about to have a all the bells and whistles website built, goes against the grain with me as I am an old school motor trader, however embrace or die.
New website will have video,live help, up to 50 hi res photos, instant finance quotations against all stock, direct feed into finance companies for proposals, direct info feed to twitter, facebook etc etc...There is a lot of work involved in doing this, I may have to employ a full time web person to do the videos/websites.
So the person at home has come to my super website, looked at the vid, pics, dealership profile, arranged his finance,bought an extended warranty, does he care if he is buying from a high street garge or a tidy industrial unit, or even home premises .... I think if it is proffesional looking most dont care.
You are doing remarkably well for the amount of advertising you do. Not sure if the market is better in NI than here, part of the problem for dealers is too much choice for the consumer.
Summary...get a dogs b
ks website built, dont have the overheads that a showroom brings, you will work 14 hour days but at the end of it you just might earn a living!! Thats the route i forsee. My next major outgoing is likely to be a small unit in an industrial estate for viewings and handovers - but currently its working well either meeting people somewhere mutually convenient, taking the car to them or having them come to my house. Currently with my website, advertising on gumtree each day (free) and 12 slots on www.usedcarsni.com (£75 a month) I'm averaging selling around 25 cars a month. One in three calls leads to a viewing. 80-90% of viewings lead to a sale.
My website cost me £180 all in and is generating the sales i need at the moment - its not currently a limiting factor for business growth for me.
daemon said:
+1
Thats the route i forsee. My next major outgoing is likely to be a small unit in an industrial estate for viewings and handovers - but currently its working well either meeting people somewhere mutually convenient, taking the car to them or having them come to my house. Currently with my website, advertising on gumtree each day (free) and 12 slots on www.usedcarsni.com (£75 a month) I'm averaging selling around 25 cars a month. One in three calls leads to a viewing. 80-90% of viewings lead to a sale.
My website cost me £180 all in and is generating the sales i need at the moment - its not currently a limiting factor for business growth for me.
You're doing pretty well there, I have to say. I'm averaging much less but then its only been up and running for two months and I am trying to be slightly niche. However, I always said if what I personally like doesn't sell then I'll change to more bread and butter stuff.Thats the route i forsee. My next major outgoing is likely to be a small unit in an industrial estate for viewings and handovers - but currently its working well either meeting people somewhere mutually convenient, taking the car to them or having them come to my house. Currently with my website, advertising on gumtree each day (free) and 12 slots on www.usedcarsni.com (£75 a month) I'm averaging selling around 25 cars a month. One in three calls leads to a viewing. 80-90% of viewings lead to a sale.
My website cost me £180 all in and is generating the sales i need at the moment - its not currently a limiting factor for business growth for me.
At the moment I'm earning more from my other (part time) business than I am from cars.
BruceV8 said:
daemon said:
+1
Thats the route i forsee. My next major outgoing is likely to be a small unit in an industrial estate for viewings and handovers - but currently its working well either meeting people somewhere mutually convenient, taking the car to them or having them come to my house. Currently with my website, advertising on gumtree each day (free) and 12 slots on www.usedcarsni.com (£75 a month) I'm averaging selling around 25 cars a month. One in three calls leads to a viewing. 80-90% of viewings lead to a sale.
My website cost me £180 all in and is generating the sales i need at the moment - its not currently a limiting factor for business growth for me.
You're doing pretty well there, I have to say. I'm averaging much less but then its only been up and running for two months and I am trying to be slightly niche. However, I always said if what I personally like doesn't sell then I'll change to more bread and butter stuff.Thats the route i forsee. My next major outgoing is likely to be a small unit in an industrial estate for viewings and handovers - but currently its working well either meeting people somewhere mutually convenient, taking the car to them or having them come to my house. Currently with my website, advertising on gumtree each day (free) and 12 slots on www.usedcarsni.com (£75 a month) I'm averaging selling around 25 cars a month. One in three calls leads to a viewing. 80-90% of viewings lead to a sale.
My website cost me £180 all in and is generating the sales i need at the moment - its not currently a limiting factor for business growth for me.
At the moment I'm earning more from my other (part time) business than I am from cars.
I am fascinated by the profit mechanics of second hand car sales, what type of profit would you typically look to make/put across your cars? I'm taking it that as 25 seems to be quite alot I'd guess anywhere between 500-1000 net profit per car?
daemon said:
+1
Thats the route i forsee. My next major outgoing is likely to be a small unit in an industrial estate for viewings and handovers - but currently its working well either meeting people somewhere mutually convenient, taking the car to them or having them come to my house. Currently with my website, advertising on gumtree each day (free) and 12 slots on www.usedcarsni.com (£75 a month) I'm averaging selling around 25 cars a month. One in three calls leads to a viewing. 80-90% of viewings lead to a sale.
My website cost me £180 all in and is generating the sales i need at the moment - its not currently a limiting factor for business growth for me.
Thats the route i forsee. My next major outgoing is likely to be a small unit in an industrial estate for viewings and handovers - but currently its working well either meeting people somewhere mutually convenient, taking the car to them or having them come to my house. Currently with my website, advertising on gumtree each day (free) and 12 slots on www.usedcarsni.com (£75 a month) I'm averaging selling around 25 cars a month. One in three calls leads to a viewing. 80-90% of viewings lead to a sale.
My website cost me £180 all in and is generating the sales i need at the moment - its not currently a limiting factor for business growth for me.
smokey145 said:
I am fascinated by the profit mechanics of second hand car sales, what type of profit would you typically look to make/put across your cars? I'm taking it that as 25 seems to be quite alot I'd guess anywhere between 500-1000 net profit per car?
On cars of a reasonable price, say, £2K+ then i'd be aiming for around £500 net. However cheaper stuff ie, > £1500, its probably down to maybe £200 ish. I rarely stray much over £3000 as cars at that price tend to be slow for me.smokey145 said:
What is the bonus structure in a main deal (say BMW) for example. I've just potentially bought a £25k car, how much would the salesman earn from that? I am trying to gauge just how "important" this deal is to him.
It will depend on a number of factors.. eg: whether s/he has achieved target for the month (comm rates often incease for performance above target), whether you have bought any add-ons (eg accessories etc) and how much profit has been made. Comm is often expressed as a % of retained profit. I once made the grand sum of 52p commission for selling a brand new Volvo!...
gave it away and didn't manage to upsell anything... no accessories, no finance, no warranties etc etc. Fortunately I learned from that experience.So, as to how important it is to him, if it's the one that takes him to his target and it has a load of profit in it then very, ...or possibly not at all!!
HTH
H6CJF said:
smokey145 said:
What is the bonus structure in a main deal (say BMW) for example. I've just potentially bought a £25k car, how much would the salesman earn from that? I am trying to gauge just how "important" this deal is to him.
It will depend on a number of factors.. eg: whether s/he has achieved target for the month (comm rates often incease for performance above target), whether you have bought any add-ons (eg accessories etc) and how much profit has been made. Comm is often expressed as a % of retained profit. I once made the grand sum of 52p commission for selling a brand new Volvo!... gave it away and didn't manage to upsell anything... no accessories, no finance, no warranties etc etc. Fortunately I learned from that experience.So, as to how important it is to him, if it's the one that takes him to his target and it has a load of profit in it then very, ...or possibly not at all!!
HTH
So they will get a nominal amount for selling (about £30-£40 PU) and then more money for selling extras such as RTI, Paint Protection, Warranty and Finance packages.
Normally it doesn't matter what profit a new car makes to the salesperson. It will be the sales manager/controller/business manager/whatever they're called to make that decision.
We have been known to sell new cars at a £1000 loss in the chassis to hit a target/accelerator at the end of a quarter as selling that one car could mean the company earns £1000's.
You need to be realistic when trying to negotiate on a new car. There isn't a massive margin and you're better being prepared to know what finance option you are taking. If you can buy cash, look at if you get discount for taking the manufacturers finance and then what the options for settling early are, you can save a big chunk of cash this way
Emubiker said:
Out of interest, those of you with your own businesses and websites: Do you gain anything from having an insurance/finance link on your website in direct terms - i.e. every person who registers an interest you gain £x? Or is it more for customer convenience?
Believe it or not some of the finance companies involved in the "new breed" of websites are currently trying to charge us for the direct links to them lol....I would have thought a referral fee for each deal proposal taken was in order to ourselves. There is a small fee for each insurance policy taken out through the link though. At 22 (the same age as me) are you sure your ready to leave a wage paying job ? Ive been in the motor trade for 6 years straight out of school not in a major plc but in an independent dealership and have learned so much more by being dropped in at the deepend. IMO at a plc you are trained as a salesman to be a robot you have to ask your sales manager for everything and if you think on your feet and it doesnt turn out right your in the s*** and may get fired ! 1 years experience and you want to start your own business ? Not trying to put a downer on you but you didnt even know what BCA was !
Most dealer websites look the same because there built by someone at autotrader and link straight there.
Most dealer websites look the same because there built by someone at autotrader and link straight there.
Edited by n_const on Monday 7th November 11:50
n_const said:
At 22 (the same age as me) are you sure your ready to leave a wage paying job ? Ive been in the motor trade for 6 years straight out of school not in a major plc but in an independent dealership and have learned so much more by being dropped in at the deepend. IMO at a plc you are trained as a salesman to be a robot you have to ask your sales manager for everything and if you think on your feet and it doesnt turn out right your in the s*** and may get fired ! 1 years experience and you want to start your own business ? Not trying to put a downer on you but you didnt even know what BCA was !
Most dealer websites look the same because there built by someone at autotrader and link straight there.
Its the salesman part that I am after though, I have always worked for myself in various businesses since I was 16 (bar a short period as a waiter and 2 nights a week doing Tesco night shifts), the "steady wage" is something that is new to me, and to be honest, even doing as well as I am so far within the dealership, not as much as I know I can make for myself. So yes, my own business is the way forward, sepecially before I become a "robot". Up here I have never heard of anyone calling it BCA, we (and other dealers that I know of use "Central car auctions" and it is just reffered to as such.Most dealer websites look the same because there built by someone at autotrader and link straight there.
Edited by n_const on Monday 7th November 11:50
Oh no, the tax inspectors are out again.
If you're going to get a full on dealership with finance facilities etc then by all means register a company (limited is a mixed blessing when starting out, as PAYE ties up useful capital, though it is more tax efficient in the long run, as I understand it) then obtain premises, planning permission, licences, trade plates etc etc.
Before you do any of that though, I would test yourself out - how good are you at buying and selling cars? Test it out as a hobby business before committing yourself to it.
Do get motor trade insurance - when I did it (5-6 years ago) it was cheap and hugely convenient. If you have this trade plates are actually quite easy to obtain and can be useful, though a friend with a trailer is usually better.
Do also get an account with Experian or similar so you can do HPI checks by SMS instantly for a pennies, rather than paying big money for one as a retail customer.
Then go out and buy a car to sell. Start off one at a time, otherwise you will multiply your beginners mistakes.
Auctions are one route, with a lot of attendant risks. Most cars are there for a good reason, and will have already been passed over by other dealers. Go there to learn how to look at cars, there are some real pros at these places, talk to them, see if you can spot what they spot.
There are of course also some real low life at certain car auctions, and it's worth knowing that they are in the same business and will happily sell you a death trap or stolen car swearing it's the best thing in the world.
Private ads can turn up some bargains, or a "wanted" ad can throw up things from people who are too lazy to advertise.
I did quite well from a few rural main dealers who got charged a fortune for collection by the auctions, and were happy to sell me a their part exchanges at very reasonable prices. The problem is they sometimes give you lemons that take ages to sell as a sort of implicit condition of giving you their good stuff. These are relationships worth cultivating though as they are your oil wells.
A fresh MOT, a good clean and a well written advert can quite easily add 20% to the value of many of these cars, but there's a bit of a knack to picking the ones that sell quickly. Skoda Fabia diesels were great as taxi drivers would snap them up within hours. Certain hot hatches have a cultish following and good examples (NOT crashed, bent, or badly modified ones) can sell like hot cakes.
Any unseen problems can quickly eat into your margins, so if you can't do work yourself it's useful to know someone who can at reasonable rates as garages will charge you a fortune. I could do mechanical stuff but I was (still am) useless at bodywork, so I tended to avoid anything with scratches, bumps or rust, but did have a friend who was good with it when the need arose.
Don't try and hide the fact you're selling the car for a profit - most people are more interested in whether or not they're buying a decent car than any ulterior motives you may have, and most of the negativity surrounding traders selling from the door is usually because they try to hide it. Sometimes for no good reason at all.
I dealt mostly with cars between about £1000 and £3000, and it could be a profitable little hobby business, and could sometimes make a trading profit of £1000 a week.
Of course don't break the law, fiddle your taxes or defraud anyone, but equally don't go sinking thousands of pounds and months of effort into something that you could later find you're not good at.
I ultimately decided against it as a long term career, because there were other things I wanted to do with my life, and although I made a reasonable profit it wasn't going as well as I wanted, largely because I really wasn't all that good at it. The problem being that I actually like cars, and was a sucker for things that wouldn't sell quickly enough.
If you're going to get a full on dealership with finance facilities etc then by all means register a company (limited is a mixed blessing when starting out, as PAYE ties up useful capital, though it is more tax efficient in the long run, as I understand it) then obtain premises, planning permission, licences, trade plates etc etc.
Before you do any of that though, I would test yourself out - how good are you at buying and selling cars? Test it out as a hobby business before committing yourself to it.
Do get motor trade insurance - when I did it (5-6 years ago) it was cheap and hugely convenient. If you have this trade plates are actually quite easy to obtain and can be useful, though a friend with a trailer is usually better.
Do also get an account with Experian or similar so you can do HPI checks by SMS instantly for a pennies, rather than paying big money for one as a retail customer.
Then go out and buy a car to sell. Start off one at a time, otherwise you will multiply your beginners mistakes.
Auctions are one route, with a lot of attendant risks. Most cars are there for a good reason, and will have already been passed over by other dealers. Go there to learn how to look at cars, there are some real pros at these places, talk to them, see if you can spot what they spot.
There are of course also some real low life at certain car auctions, and it's worth knowing that they are in the same business and will happily sell you a death trap or stolen car swearing it's the best thing in the world.
Private ads can turn up some bargains, or a "wanted" ad can throw up things from people who are too lazy to advertise.
I did quite well from a few rural main dealers who got charged a fortune for collection by the auctions, and were happy to sell me a their part exchanges at very reasonable prices. The problem is they sometimes give you lemons that take ages to sell as a sort of implicit condition of giving you their good stuff. These are relationships worth cultivating though as they are your oil wells.
A fresh MOT, a good clean and a well written advert can quite easily add 20% to the value of many of these cars, but there's a bit of a knack to picking the ones that sell quickly. Skoda Fabia diesels were great as taxi drivers would snap them up within hours. Certain hot hatches have a cultish following and good examples (NOT crashed, bent, or badly modified ones) can sell like hot cakes.
Any unseen problems can quickly eat into your margins, so if you can't do work yourself it's useful to know someone who can at reasonable rates as garages will charge you a fortune. I could do mechanical stuff but I was (still am) useless at bodywork, so I tended to avoid anything with scratches, bumps or rust, but did have a friend who was good with it when the need arose.
Don't try and hide the fact you're selling the car for a profit - most people are more interested in whether or not they're buying a decent car than any ulterior motives you may have, and most of the negativity surrounding traders selling from the door is usually because they try to hide it. Sometimes for no good reason at all.
I dealt mostly with cars between about £1000 and £3000, and it could be a profitable little hobby business, and could sometimes make a trading profit of £1000 a week.
Of course don't break the law, fiddle your taxes or defraud anyone, but equally don't go sinking thousands of pounds and months of effort into something that you could later find you're not good at.
I ultimately decided against it as a long term career, because there were other things I wanted to do with my life, and although I made a reasonable profit it wasn't going as well as I wanted, largely because I really wasn't all that good at it. The problem being that I actually like cars, and was a sucker for things that wouldn't sell quickly enough.
AJS- said:
Oh no, the tax inspectors are out again.
If you're going to get a full on dealership with finance facilities etc then by all means register a company (limited is a mixed blessing when starting out, as PAYE ties up useful capital, though it is more tax efficient in the long run, as I understand it) then obtain premises, planning permission, licences, trade plates etc etc.
Before you do any of that though, I would test yourself out - how good are you at buying and selling cars? Test it out as a hobby business before committing yourself to it.
Do get motor trade insurance - when I did it (5-6 years ago) it was cheap and hugely convenient. If you have this trade plates are actually quite easy to obtain and can be useful, though a friend with a trailer is usually better.
Do also get an account with Experian or similar so you can do HPI checks by SMS instantly for a pennies, rather than paying big money for one as a retail customer.
Then go out and buy a car to sell. Start off one at a time, otherwise you will multiply your beginners mistakes.
Auctions are one route, with a lot of attendant risks. Most cars are there for a good reason, and will have already been passed over by other dealers. Go there to learn how to look at cars, there are some real pros at these places, talk to them, see if you can spot what they spot.
There are of course also some real low life at certain car auctions, and it's worth knowing that they are in the same business and will happily sell you a death trap or stolen car swearing it's the best thing in the world.
Private ads can turn up some bargains, or a "wanted" ad can throw up things from people who are too lazy to advertise.
I did quite well from a few rural main dealers who got charged a fortune for collection by the auctions, and were happy to sell me a their part exchanges at very reasonable prices. The problem is they sometimes give you lemons that take ages to sell as a sort of implicit condition of giving you their good stuff. These are relationships worth cultivating though as they are your oil wells.
A fresh MOT, a good clean and a well written advert can quite easily add 20% to the value of many of these cars, but there's a bit of a knack to picking the ones that sell quickly. Skoda Fabia diesels were great as taxi drivers would snap them up within hours. Certain hot hatches have a cultish following and good examples (NOT crashed, bent, or badly modified ones) can sell like hot cakes.
Any unseen problems can quickly eat into your margins, so if you can't do work yourself it's useful to know someone who can at reasonable rates as garages will charge you a fortune. I could do mechanical stuff but I was (still am) useless at bodywork, so I tended to avoid anything with scratches, bumps or rust, but did have a friend who was good with it when the need arose.
Don't try and hide the fact you're selling the car for a profit - most people are more interested in whether or not they're buying a decent car than any ulterior motives you may have, and most of the negativity surrounding traders selling from the door is usually because they try to hide it. Sometimes for no good reason at all.
I dealt mostly with cars between about £1000 and £3000, and it could be a profitable little hobby business, and could sometimes make a trading profit of £1000 a week.
Of course don't break the law, fiddle your taxes or defraud anyone, but equally don't go sinking thousands of pounds and months of effort into something that you could later find you're not good at.
I ultimately decided against it as a long term career, because there were other things I wanted to do with my life, and although I made a reasonable profit it wasn't going as well as I wanted, largely because I really wasn't all that good at it. The problem being that I actually like cars, and was a sucker for things that wouldn't sell quickly enough.
this is a very interesting and informative post. can i ask, how full on is your job? i ask because i would like to sell some cars "on the side" but i have a pretty demanding day job. i like the idea of buying cars between say £1k & £3k in value, maybe turn one over a month and should be looking to make 25% net minimum? If you're going to get a full on dealership with finance facilities etc then by all means register a company (limited is a mixed blessing when starting out, as PAYE ties up useful capital, though it is more tax efficient in the long run, as I understand it) then obtain premises, planning permission, licences, trade plates etc etc.
Before you do any of that though, I would test yourself out - how good are you at buying and selling cars? Test it out as a hobby business before committing yourself to it.
Do get motor trade insurance - when I did it (5-6 years ago) it was cheap and hugely convenient. If you have this trade plates are actually quite easy to obtain and can be useful, though a friend with a trailer is usually better.
Do also get an account with Experian or similar so you can do HPI checks by SMS instantly for a pennies, rather than paying big money for one as a retail customer.
Then go out and buy a car to sell. Start off one at a time, otherwise you will multiply your beginners mistakes.
Auctions are one route, with a lot of attendant risks. Most cars are there for a good reason, and will have already been passed over by other dealers. Go there to learn how to look at cars, there are some real pros at these places, talk to them, see if you can spot what they spot.
There are of course also some real low life at certain car auctions, and it's worth knowing that they are in the same business and will happily sell you a death trap or stolen car swearing it's the best thing in the world.
Private ads can turn up some bargains, or a "wanted" ad can throw up things from people who are too lazy to advertise.
I did quite well from a few rural main dealers who got charged a fortune for collection by the auctions, and were happy to sell me a their part exchanges at very reasonable prices. The problem is they sometimes give you lemons that take ages to sell as a sort of implicit condition of giving you their good stuff. These are relationships worth cultivating though as they are your oil wells.
A fresh MOT, a good clean and a well written advert can quite easily add 20% to the value of many of these cars, but there's a bit of a knack to picking the ones that sell quickly. Skoda Fabia diesels were great as taxi drivers would snap them up within hours. Certain hot hatches have a cultish following and good examples (NOT crashed, bent, or badly modified ones) can sell like hot cakes.
Any unseen problems can quickly eat into your margins, so if you can't do work yourself it's useful to know someone who can at reasonable rates as garages will charge you a fortune. I could do mechanical stuff but I was (still am) useless at bodywork, so I tended to avoid anything with scratches, bumps or rust, but did have a friend who was good with it when the need arose.
Don't try and hide the fact you're selling the car for a profit - most people are more interested in whether or not they're buying a decent car than any ulterior motives you may have, and most of the negativity surrounding traders selling from the door is usually because they try to hide it. Sometimes for no good reason at all.
I dealt mostly with cars between about £1000 and £3000, and it could be a profitable little hobby business, and could sometimes make a trading profit of £1000 a week.
Of course don't break the law, fiddle your taxes or defraud anyone, but equally don't go sinking thousands of pounds and months of effort into something that you could later find you're not good at.
I ultimately decided against it as a long term career, because there were other things I wanted to do with my life, and although I made a reasonable profit it wasn't going as well as I wanted, largely because I really wasn't all that good at it. The problem being that I actually like cars, and was a sucker for things that wouldn't sell quickly enough.
i would like to know a little bit more about how you juggled your real job and this side hobby polease, very interesting,
anyone else doing the same?
thanks
I'm looking to sell a few cars from home and from what I can gather from this thread the only thing I will need is a traders insurance policy as this will insure me on any car up to the agreed limit. When getting quotes, most policies had the option of adding "demonstration cover", is this an option that covers customers when test driving your cars?
Yes demonstration covers you for test drives, make sure its fully comp though. I started trading cars, and never worked in anything motor trade before, was all self taught. Been at it 2 years, started with just 1 car and kept putting my money back in. I worked fulltime and did so until i had about 6 cars. Then i was made redundant. Till this time i worked from home, so moved to a small unit. I still work completely on my own. Has its downsides, but i love it. Now at 26, im getting a few cars iv always wanted. My website if you want to browse is www.automotive-cars.co.uk
I'm going to ask a Frank question, and I'd understand if you weren't to answer, but what would you consider to be a good year, salary/profit wise, 30-40k? 40-70k? More?
coxy1 said:
Yes demonstration covers you for test drives, make sure its fully comp though. I started trading cars, and never worked in anything motor trade before, was all self taught. Been at it 2 years, started with just 1 car and kept putting my money back in. I worked fulltime and did so until i had about 6 cars. Then i was made redundant. Till this time i worked from home, so moved to a small unit. I still work completely on my own. Has its downsides, but i love it. Now at 26, im getting a few cars iv always wanted. My website if you want to browse is www.automotive-cars.co.uk
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