Rob350z Posted August 4, 2011 Share Posted August 4, 2011 Well im thinking about taking a chance with my savings and opening my own business... I know my cars and so far Ive only made a loss on 2 of the 11 cars Ive owned in the past so Im thinking a car trader is the way forward... Buy cars around the 5-6k give them a service and a good valet and sell them on... Now my questions are: Is it a good business to get into??? Can you make a living of it??? What exactly do you need to make a start??? Trade plates, insurance, trailer and tow car??? Ive done a bit of weddesign before so I can wip up a webite no problem... Do I have to register the business and the name and if so where??? Is it worth getting a forecourt??? or better to just keep them at home? Where do you get the cars from??? I know the usual spots like auctions, ebay, autotrader and pistonheads but what about the less known places ??? any police auctions, dealer PX clearouts, trade only auctions??? Do i have to provide warranty for the cars or can i use AS-IS basis??? Will that keep me covered if things go wrong??? Is it better to provide warranty??? What sort of profits should I be expecting ??? Ive got a million things going through my head at the moment and cand stop thinking about it.... Any help or advice positive or negative is gratefully received, Im about to risk a good 10 years of savings so Id like to have all things covered. Thank you Quote Link to comment Share on other sites More sharing options...
Ekona Posted August 4, 2011 Share Posted August 4, 2011 I'll list the obvious stuff as it comes into my head: 1. You can make a living from anything if you're a good businessman. Car sales is no different. 2. Insurance, insurance, insurance. Public liability as well as the obvious insurance for the cars. 3. Yes, register it with Companies House. Depending on turnover you may need to be VAT registered as well. 4. It's illegal to sell cars from home, your local council will have a field day with that. You will need premises of some kind. 5. Anywhere and everywhere. Every car you see is a possible purchase, but you've listed everything obvious. Part-exchanges will probably be a good part of your business I suspect. 6. Read the SOGA and SOGASA, your legal obligations are in there. In short though, a minimum of 3 months warranty will need to be supplied from either you directly or via a warranty company. 7. How long is a piece of string? Too many variables, but on each car I'd be looking for a minimum of 20-30% profit bearing in mind all the overheads you'll need to pay for. No offence meant, but judging from your questions you're in no way ready for this at all. It's one thing to see the odd car for a bit of extra cash, but another thing to start a brand-new business from scratch which I'm assuming you have no experience of. I wish you luck, but you really need to do a serious amount more research yet. Quote Link to comment Share on other sites More sharing options...
MidnightRacer Posted August 4, 2011 Share Posted August 4, 2011 Pretty much as above! if I was you I'd try it out in your spare time with 1 or 2 cars before ploughing head long into it all guns blazing! from the car traders I've spoken to all started small buying a cheap car and selling it on, then buying another. Specialising in one brand might also go in your favour. I would say on a 5 grand car you want £1000 markup at least to make it worthwhile. Quote Link to comment Share on other sites More sharing options...
EH 370z Posted August 4, 2011 Share Posted August 4, 2011 Aggreed. Start small, "Door step" a couple from home to see how you get on. The last thing you want to do is blow a fortune on many expensive cars. Remember, these things nearly always go down in price! The trick is, buy the car right and spin it as quickly as possible so you dont have any gaps in your bank balance!! Sounds obvious but you would be supprised how many "Professionals" get this bit wrong Quote Link to comment Share on other sites More sharing options...
geoff-r Posted August 4, 2011 Share Posted August 4, 2011 Just one question, have you worked in the car trade before? Connections are important! I don't know if this has changed much but a mate gets a great deal of his cars from dealers,they're part-ex's and that's based on working up a reputation as a trader. I think for VAT purposes you register once you have a turnover of £60k, someone please correct me if I'm wrong. My advice would be to get a few low budget motors first, see how it goes, start small and make your way up. Ploughing your savings into a business you seem fairly new to will not return you a bigger profit. Learn the trade then invest. Quote Link to comment Share on other sites More sharing options...
MidnightRacer Posted August 4, 2011 Share Posted August 4, 2011 You are right. connections are 99% of the motor trade. selling a car is easy, making money is the hard part! Quote Link to comment Share on other sites More sharing options...
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