starting a car dealership

[smokey145]

Coxy, your website looks very good. Well done, big achievements at 26.

[AJS-]

smokey145 said:

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?

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 started off while I was still working in London, pretty full on, didn't get out until around 7 most evenings, so the car dealing was very much a part time affair.

Then I got out of London and did cars sort of full time for a few months. I say "sort of" because I wasn't doing anything else, and went off on the odd jaunt around Europe inbetween times. Funded partly by cars but mostly by what I'd saved from working.

Then I decided I wanted to go to Australia so I took temp work when I could get it and carried on with the cars inbetween and around this.

Like any business it can and should be fairly time consuming, but doing one or two cars a month is quite compatiable with a demanding full time job in my experience.

The difficulty wouldn't be selling the cars so much as buying them, main dealers want to off load their PXs during the week and auctions are mostly geared to full time traders too.

For that volume of cars though there would be plenty in the local free ads or other bargains. Just look out for badly writted ads, lazy sellers etc, as this can easily be worth a few hundred pounds on a £2000 car. Run a wanted ad, and keep an eye out for unloved cars on driveways - it always amazes me how many otherwise cautious and prudent people leave a couple of thousand pounds sat outside rotting away because they never get round to selling it!

[BrassMonkey]

Looks like some guys that started doing it part time alongside their full time jobs are doing really well!

A few questions; did you initially just register as a sole trader and gradually as you have been turning over more money, incorporated the company? (I know the limit for a sole trader is £70k or something). And what is your main source of cars? (I know it sounds like I'm trying to steal your business but I'm not!)

[V8mate]

BrassMonkey said:

Looks like some guys that started doing it part time alongside their full time jobs are doing really well!

A few questions; did you initially just register as a sole trader and gradually as you have been turning over more money, incorporated the company? (I know the limit for a sole trader is £70k or something). And what is your main source of cars? (I know it sounds like I'm trying to steal your business but I'm not!)

There's no limit to the turnover of a sole trader.

I think you may be confsing it with the £73k turnover limit for registering for VAT.

[BrassMonkey]

V8mate said:

There's no limit to the turnover of a sole trader.

I think you may be confsing it with the £73k turnover limit for registering for VAT.

Yes I think your right, my mistake.

Another thing I have thought of; if you are selling part-time as a dealer it means if there is something wrong with the car in the first x amount of days you have to put it right. How have you part-time dealers coped with this? If someone returns a £1000 car you sold them with a problem and the problem costs £500 to fix. Do you just have to suck it up and fork out the £500 to get it fixed. How does this work?

[V8mate]

BrassMonkey said:

Another thing I have thought of; if you are selling part-time as a dealer it means if there is something wrong with the car in the first x amount of days you have to put it right.

Blimey. You're a real gem for misleading advice.

[BrassMonkey]

V8mate said:

Blimey. You're a real gem for misleading advice.

I am making this up as I go along so correct me if I'm wrong but I thought if you buy a car from a dealer and a fault occurs (eg. buy an RX8 and the engine loses compression 1 week later) you have some comeback whereas if you buy it privately you have no comeback.

[coxy1]

Yes if a car breaks within a week regardless of cost then its to fix! If margins are good you would be unlucky to lose out, but you may get a bad egg in 10, its just part of being a trader. Iv had 3 problems in the 2 years, but im exceptionally anal about what i buy and the car has to be perfect before it goes out.

Start it as a part time thing see how it pans, i made good money doing it along side my fulltime job so any money earned was put back in. It did mean i was working well over 12 hours a day 7 days a week. Bit more relaxed now but the hours are unsociable and sometimes i have to drop what im doing to meet a customer. You need a lot of cash before thinking of premises. If any of you want to discuss in more length or need any help, my number is on my website, or email address.

[smokey145]

smokey145 said:

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

coxy, frank question? ^

[singlecoil]

smokey145 said:

smokey145 said:

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

coxy, frank question? ^

Frank question maybe, but not really the sort of thing to be discussed on a public forum (or even in private come to that), asking people how much they earn isn't really the done thing.

[V8mate]

coxy1 said:

Yes if a car breaks within a week regardless of cost then its to fix!

Really?

Punter buys car. Decides to change the oil after two days; doesn't screw sump plug back in properly. Oil leaks out, engine seizes. Down to the dealer to fix?

[BrassMonkey]

coxy1 said:

Yes if a car breaks within a week regardless of cost then its to fix! If margins are good you would be unlucky to lose out, but you may get a bad egg in 10, its just part of being a trader. Iv had 3 problems in the 2 years, but im exceptionally anal about what i buy and the car has to be perfect before it goes out.

Start it as a part time thing see how it pans, i made good money doing it along side my fulltime job so any money earned was put back in. It did mean i was working well over 12 hours a day 7 days a week. Bit more relaxed now but the hours are unsociable and sometimes i have to drop what im doing to meet a customer. You need a lot of cash before thinking of premises. If any of you want to discuss in more length or need any help, my number is on my website, or email address.

Thanks Coxy, you've been a great help. I may drop you a line for some further information. Now to get traders insurance, am under 25 so the quotes im getting are expensive!

[smokey145]

singlecoil said:

smokey145 said:

smokey145 said:

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

coxy, frank question? ^

Frank question maybe, but not really the sort of thing to be discussed on a public forum (or even in private come to that), asking people how much they earn isn't really the done thing.

i agree it is crass, being nosey.

[100hourweek]

I only check pistonheads every month or so and theres always a thread in here about someone starting a car dealership lol.

i have a pretty sucsessfull car sales garage in Glasgow (in my opinion atleast), i sell a minimum of 60 cars a month retail and trade around 20 units a month aswell.

I started with 3 cars 4 years ago, I now own a 6000 sq foot MOT station aswell as 2 car sales yard and have 120 cars in stock roughly at any one time.

Its not easy but there is money to be made if done properly. Id say i put around 100 hours in a week for work, I barely sleep and when i do im sure i dream about being at the auctions.

Im just looking at opening my third sales yard and always do a list of whats required so i will give you a run down of the things i couldnt live without

An understanding girlfriend
Rent of a yard
Autotrader bill £850 a week
Ebay motors bill
Glasses guide
Trade insurance
trade plates
Buisness insurance
Magazine advert
staff (i have 4 and i need them, i couldnt do it without my 2 right hand men who basicly orginise my life for me)
2 x mot stations to use
2 x paint shops to use
2 x auto electricians to use
2x repair garages to use
A diesel specialist
a good scrap yard your friendly with
Merchant services
Your own transporter
CCTV Equipment
Overflow space - as someone said for me to have 120 cars ready to retail i need another 30 getting prepper and 20 sitting in hand over zone i also have a dead zone for cars i want to forget about haha )
Credit consumers license for finance
Used car dealers license
trade acounts with bca, manheim, central, sma , interstty and good trade sources for cars, Its easier to sell well prices cars justnow than it is to buy them.
A good accountant.
a good selection of tools
A snap on booster pack, nothing else cuts it for me.
Your own diagnostic and battery recharging equipement
A complaints procedure
a warranty company who will actually pay out.
Friends to help you
A decent internet provider as autotrader dealer edit needs it.
A firm but fair attitude, the public with try take the piss out of you at any opertunity


thats just the basics i can think of there will be tons more, Good luck with it.

Edited by 100hourweek on Friday 21st February 22:49

[100hourweek]

I only check pistonheads every month or so and theres always a thread in here about someone starting a car dealership lol.

i have a pretty sucsessfull car sales garage in Glasgow (in my opinion atleast), i sell a minimum of 60 cars a month retail and trade around 20 units a month aswell.

I started with 3 cars 4 years ago, I now own a 6000 sq foot MOT station aswell as 2 car sales yard and have 120 cars in stock roughly at any one time.

Its not easy but there is money to be made if done properly. Id say i put around 100 hours in a week for work, I barely sleep and when i do im sure i dream about being at the auctions.

Im just looking at opening my third sales yard and always do a list of whats required so i will give you a run down of the things i couldnt live without

An understanding girlfriend
Rent of a yard
Autotrader bill £850 a week
Ebay motors bill
Glasses guide
Trade insurance
trade plates
Buisness insurance
Magazine advert
staff (i have 4 and i need them, i couldnt do it without my 2 right hand men who basicly orginise my life for me)
2 x mot stations to use
2 x paint shops to use
2 x auto electricians to use
2x repair garages to use
A diesel specialist
a good scrap yard your friendly with
Merchant services
Your own transporter
CCTV Equipment
Overflow space - as someone said for me to have 120 cars ready to retail i need another 30 getting prepper and 20 sitting in hand over zone i also have a dead zone for cars i want to forget about haha )
Credit consumers license for finance
Used car dealers license
trade acounts with bca, manheim, central, sma , interstty and good trade sources for cars, Its easier to sell well prices cars justnow than it is to buy them.
A good accountant.
a good selection of tools
A snap on booster pack, nothing else cuts it for me.
Your own diagnostic and battery recharging equipement
A complaints procedure
a warranty company who will actually pay out.
Friends to help you
A decent internet provider as autotrader dealer edit needs it.
A firm but fair attitude, the public with try take the piss out of you at any opertunity


thats just the basics i can think of there will be tons more, Good luck with it.

Edited by 100hourweek on Friday 21st February 22:50

[IrrElephant]

100hourweek, that's awesome. Wish I had had the intuition to do it a few years ago when I first got into the trade. Well done.

[coxy1]

In answer to your question, not as much as 100hourweeks! 4 people to shift 60 units a month is some achievement! Link to your site?

[100hourweek]

We used to do 60 units a month with 3 workers but it became too much for us.

Edited by 100hourweek on Monday 22 October 16:42

[coxy1]

Thanks for that. We have gone down 2 very different routes, so interesting for people to see the differences.

[doosht]

Sorry to crash the thread but i have a related question. How do you get on with the log book when buying a car? What i mean is that its usually a couple of weeks before the log book comes back but what if you want it sold in the meantime?
Also, as a trader does it still mean there is now 1 more keeper on the logbook?