NEW BUSINESS HELP - from industrial site

[jayrussell]

Hello al;

I have currently been in the motor trade for the past 9 years (main dealer and independent)

After saving hard and a tiny bit of help off an inheritance I want to start up my own used car business mainly selling online but sometime at the premises which is an industrial warehouse with outside frontage for 10 cars and inside for 25+, the 6 buildings around are all car related repairs, tyres, body shop and valters

I am after help to start with to see what things to include or anyone else's experience in this would be amazing.

I have at the moment costs for

Rent
Rates
Service charge
Advertising
Website
Trade plates
Card machine for payments
Warranty company (warrantywise)

I am awaiting on the motor trade insurance and the insurance for my stock too, any help with who's best? or a rough guess of what others pay

Any help would be amazing

Many thanks a very nervous but excited Guy

[Stephanie Plum]

Congrats

Get yourself a good accountant and a system for keeping your books accurately and easily. Consider how you'll market yourself - are you going for single make, sports, 4WD? etc and looking to make a reputation for yourself or just general cars - how you reach your chosen audience is key. If going the specialist route look for forums and clubs where you can promote yourself and start to build a good solid rep.

A good website with up to the minute seo and stock content will be needed too. With no/limited passing trade you'll need to advertise yourself carefully.

Think about how you'll prep the cars - yourself or with help? A good friend did this very successfully, but it was very hard graft and he had a brilliant name within his chosen marque. Good luck and don't underestimate the hours and work you'll be putting in.

[PurpleMoonlight]

Insurance, trade and public liability.

Employees, and associated costs.

Office equipment.

Garage equipment.

Accountancy costs.

[covmutley]

You probably need planning permission for change of use of the unit to car sales.

The application fee is £385. Allow at least £500-£1000 for someone to do drawings and manage application for you? Give the Council a call yourself first to get their reaction.

[Frimley111R]

do a search on here, there was a thread about this which covered everything you will need

[richardxjr]

Understand VAT totally.

[Chrisgr31]

covmutley said:

You probably need planning permission for change of use of the unit to car sales.

The application fee is £385. Allow at least £500-£1000 for someone to do drawings and manage application for you? Give the Council a call yourself first to get their reaction.

You'll certainly need planning consent and it is unlikely to be easy to obtain.

[ModernAndy]

In order to really get to the bottom of the big costs you need to sit down with a sheet of paper, draw a line down the middle, write "fixed" on one side and "variable" on the other. Fixed costs are costs you'll incur no matter how much you sell (rent, rates, insurance, etc.) and variable costs are costs that occur when something is sold (warranty on a car, cost of a full tank of fuel with every sale if you're that way inclined, etc. If you gave a free bottle of champagne to every buyer then that would mean every sale would cost however much a bottle of that would cost you).

To go a step further, if you can figure out the average revenue from a sale you can deduct the variable costs from that and divide all the fixed costs by that figure to get the number of sales you need to break even.

E.g. Av. Revenue= £100
Fixed costs= £1,000
Variable costs= £40

£100-£40= £60
£1,000/£60= 16.66

Therefore you need to sell 16.66 things to break even.

Sorry if that's preaching to the choir but it's something not a lot of folks do before starting a business.

[richardxjr]

From similar threads on here the most important part of the used car biz seems to be where you are buying from. Presumably as you're not new to this, you've got that bit sorted.

[budfox]

Be nice to people. People buy from people they like.

Within a minute of meeting a car salesman I know whether or not I'd buy a car from them.