TouringLow

Does anyone think its a bad time to profit from a used car selling business? I don't mean a dealership lot, but just buying used cars at auctions and selling them as a private seller.



Just curious and hoping for some first-hand insights in the business.

doopstr

I knew someone's dad that always has one or two cars in his driveway for sale. He's been doing it for over 20 years. Must make decent money. He lives on a fairly busy street so the cars get good exposure.

banelba

Could be a good business if you get the cars at a very good deal and have a good network. You do not want to have cars for a longtime without selling them. I'm talking about the turn ratio. And sometimes, you'll have some small work that need t o be done to the cars. So if you are a mechanic or know a good cheap one, if would also help.
Just believe in yourself and be determine, treat your custumers right and you'll get there.

Zippee

In some places if you buy and sell more than a few cars a year you have to get a dealers license. That means business taxes, insurance, permits and all that happy stuff.

Do your research before you jump in and get a bite in the ass.

TzarChasm

Absolutely correct. And in some places the limit is pretty low, I believe here it's 2 cars a year.

Are you planning to buy the cars outright, or are you planing on financing them and hoping to sell them before you take a loss?

TouringLow

I'm in ca so if anyone knows about the laws regarding ca it would be great.

I'm looking to purchase on my own funds and sell.


Thanks for all the comments and tips. Greatly appreciated

MR1

check california dmv website.

should be plenty of information there starting with you need an address where you can legally display the cars. Aforum is no place to obtain legal information.

TouringLow

what is bad about a slower turn over ratio other than the fact you arent making profit during the moment? does it look bad for the seller?

i believe it is 3 cars a year for california, but i plan to sell much more, so either way i plan to get a used sales license as well as a business license. anyone know if any insurance or liability is involved? i only plan to keep the cars on my resident property and not open a lot or anything like that.

thanks for all the help so far for those that contributed.

juniorbean

iTrader: (5)

I know with NY the limit was 2 or 3 cars per year, then you had to get a dealer's license. With the laws California has, I would guess it's the same if not lower, meaning you'll need to get a dealer's license. The CA DMV site should help you along. The Secretary of State website for CA should also have info/requirements for different businesses.

For any business like that you will need at least liability insurance. I do not know if you need special insurance beyond that for stuff like test drives, etc. You likely do... but I do not have any experience with that so I wouldn't even guess.

I would also check with your local town and county ordinances. You may not be able to leave unregistered cars on your property for more then a day or two... meaning you'd either need a garage or a lot.

I'd recommend PMing the member (and mega-mod) Shoofin here on AZ. He owns his own car dealership and I believe it's only pre-owned vehicles. Even though he's in NJ... he will be able to help you with most of the questions you may have.

Good luck!

burtonblue75

Just make sure you get some "As is" "no warrenty" slips made up at kinkos! Lots of tees to cross and eyes to dot! Good luck!

nsnrider

iTrader: (2)

I wouldn't recomend starting a used car business at this time given the state of our economy. Buyers just don't want to spend their cash nowadays and the banks and pretty tight about who they give out auto loans to, so unless you are willing to in-house finance you vehicles, the turn around time will likely be long, unless of course you give crazy discounts and live on a VERY busy area with lots of potential buyers. Then again, the more discounts you give, the less profit for you....

I run a small repair shop and sell used cars, been duing it since january 2000 and can tell you that this year has been the most unpredictable and slowest yet, hopefully it changes soon.

Whatever you choose to do, good luck

vas25tl

Our law is 6 or 7 a year, we can turn over. I personally do not recommend starting a car business right now. You could very quickly see yourself in a situation in which there is no way out. The market is so volatile right now that it's impossible to foresee what is going to happen. I worked for a small family dealership for about 4 years where I know the good times and the bad; which is why I am not there anymore..

If you do get into it, just remember, a LOT more people can afford cheaper cars - you will appeal to a broader audience with a $3K accord than a $15K BMW.
----The only problem is, these $3K accords are very difficult to find in good shape at the auction, they are even more expensive there than on the street at times.

I still work with cars (I am involved in service marketing for American Honda) and I honestly don't see the market turning around any time soon.

GL with any decision you make.