Are you thinking about starting your own car dealership? Selling cars can be a lucrative and rewarding career path, but it is also a tricky business to run quite unlike any other, and it can be highly competitive. There is always demand as people always need to buy automobiles, but they will always take their time and use a reliable dealership. Hence, you need to know how you can attract customers and build a positive reputation for yourself. With this in mind, here are a few tips for starting a car dealership, which will hopefully help you to hit the ground running.
Carry Out Thorough Research
As with any industry, you must carry out market research so that you can learn about the industry and create a detailed business plan. You should not rush through the research stage as this can help you to make smarter business decisions and find ways to succeed, including knowing more about your target customer and what the strengths and weaknesses of your competitors are.
Secure Enough Funding
When starting a car dealership, there will be several expenses to cover, so you need to calculate what your startup costs and then work to secure this funding. There are several good finance options to consider, including:
- Bank loans
- Crowdfunding
- Personal savings
- Angel investors
- Venture capitalists
Choose A Suitable Location
One of the most important decisions that you need to make in the early stages is where to have your dealership. This will have a significant impact on the success of your business as it will need to be somewhere that is easily accessible but also somewhere that will have enough floor space. Keep in mind that you will only be abler to have a certain number of vehicles in the lot at any time, so you need to find somewhere that is large enough and be intelligent when it comes to layout.
Register Business & Create A Strong Brand Identity
Before you can commence a business, you will need to register the company, apply for licenses and permits, and anything else that might be required (this will vary depending on where you are starting the business). As with any business, you will need to create a strong brand identity in the form of a memorable business name and an eye-pleasing logo.
Create A High-Quality Website
While selling cars remains a face-to-face business, it is still essential that you have a high-quality website as people will first look online when looking to buy a used car. This website should be easy-to-use, modern, and valuable, so it is a good idea to have it created by a professional. In terms of content, you should have detailed information about the stock that you currently have, including professional-standard photographs and detailed descriptions – it is also helpful to have the ability to book in a viewing and test drive online. You should also use customer reviews on the website once you start to obtain these.
Provide Online Customer Service
Following this, it is also helpful if you can provide instant, online customer service so that you can answer questions and increase conversions. People will often have questions about an automobile and be cautious in the market, so if you can provide instant support through online chat, then you could gain a competitive advantage and improve your reputation.
Increase Website Visibility with Digital Marketing
You will want the website to be as visible as possible so that you can raise brand awareness, but this is challenging in such a competitive industry. This is why you need to use an experienced digital marketing agency that will be able to increase traffic in both the long and short term.
Promote Business Offline
While it certainly is essential to use digital marketing, you must also make sure that you are promoting the business offline as you will be targeting those that live in the area. More traditional forms of marketing like print adverts, billboards, and radio ads are all highly worthwhile, as well as getting involved with the local community to raise awareness and humanize the brand. You could also look to form strategic alliances with other locals’ businesses, such as a mechanic.
Start Off Small
As a new car dealership, you need to walk before you can run, which means that it is a good idea to start off with a small inventory and then look to increase the number of cars as your reputation grows and there is more money coming into the dealership. Auctions are an excellent place to start as you can find high-quality yet affordable used cars here, and auctions are highly frequent so it should not be too hard to find one in your local area.
Use A Vehicle Transport Expert
Following this, in terms of moving your inventory, you must use a company that you can rely on, such as Acertus. Vehicle transportation can be stressful, complicated, and expensive. Still, with the right company, you can reduce costs by transporting multiple vehicles at once and benefit from their expertise so that cars are moved safely and securely, whether this is from an auction to the dealership or even delivered to your customers’ front door.
Prioritize Customer Service
As previously mentioned, people are cautious and hesitant when shopping in the used car market, which is understandable as it is a significant purchase, and you often hear many negative stories of unreliable dealerships and used car scams. This is why customer service is so crucial in this industry, you need to recruit the right kind of people and make staff training as detailed as possible so that your people know how to build relationships visitors and help them to find what they are looking for.
Starting a used car dealership can be a smart move, but this is not a regular type of business, which is why you need to know how to succeed and hit the ground running. Hopefully, this post will help you to achieve this and quickly build a reputation for your dealership.
Kidal Delonix is a contributor to Mr. Hoffman's blog. The views and opinions are entirely his/her own and may not reflect Mr Hoffman's views.
