Could you really open your own car dealership?
If and have a passion for the automotive industry and dream of owning your own business, opening a car dealership could be the perfect plan. There’s always a steady demand for good quality cars, new and used, which provides an excellent environment for a new business to thrive.
The first step is to decide on the type of dealership you’d ideally like to have. Are you interested in selling cars that are new or used, or do you want to carry both? The advantage of used cars is that the initial investment is not as large as with new vehicles, but this benefit is offset by the fact that the profit potential is much greater on new cars vs. used.
Once you’ve settled on the type of dealership you want to open, you’ll need to assemble a comprehensive business plan. Details in your plan should include items such as the brand or brands of cars you plan to sell, business equipment costs, employee salaries, and advertising budget. You’ll also need to secure your dealer’s license, comprehensive insurance coverage, and bonding to protect against contract defaults.
The work will be worth it
As you create your business plan, think about the number of employees you’ll need as well as the kind of experience they should have. And choose the location carefully. Ideally, the site you choose for your car lot should be on a well-traveled street or located at a busy intersection. You’d be surprised at the number of people who will make an unplanned stop when a car catches their eye.
The list of tasks that have to be completed before you open your own car dealership may sound overwhelming but solidifying a detailed business plan is one of the best ways to ensure success. If you’re not currently familiar with how to sell cars, it’s important to take the time to learn good sales techniques that will resonate with the buyers. Satisfied customers are more likely to recommend your dealership to friends and relatives.
On the legal side of things, educate yourself on industry specific topics such as lemon laws, warranty requirements, and the Consumer Rights and Safety laws. With regard to the financials, you’ll need to have a good system in place for managing inventory and managing revenue.
As exciting as owning your own dealership may seem, there are many practical matters that need to be attended to both before and after you’ve started the business. Partnering with an accounting company for car dealerships, like GYL, can help you stay on track financially and legally.
Our CPA’s have expert knowledge in the industry’s software, taxation, financial statement filing, and accounting requirements. We can help you keep your business running smoothly, while maximizing profitability. Call or go online today to find out more about how the folks at GYL can help you realize your dream of owning a car dealership.