If you love vehicles, like to think and talk to people about them, and are looking for a new business idea, you may want to consider starting your own automotive dealership franchise. Starting an automotive dealership franchise is a big step, but if you take it one step at a time, it is something that you can easily achieve. 

Figure Out How Much Startup Capital You Need

You can't just start a car dealership out of thin air; this isn't an online side-hustle. This is a serious business idea that will require some startup capital to get started. How much startup capital you need depends on how much inventory you want to start with and a few other factors. 

For example, if you are planning on starting a brand-name franchise, you will pay more for your inventory than if you are starting with second-hand vehicles of various makes and models. Some other startup costs you need to consider include: 

• Rent for the parking lot, garage, business office, and service center
• Inventory to get started
• Office equipment 
• Bonding and licensing
• Franchise fee
• Employees 

You need to have enough capital to cover all of the above expenses. For ongoing expenses like rent and employees, you will want to have enough capital to cover these things for three to six months before you start depending on bringing in money from your dealership. 

The Type of Dealership

Next, you will need to figure out what type of dealership you want to start. There are different types of dealership types you can start, depending on the type of cars you want to sell.

• Used: With a used dealership, you can sell all types of used vehicles. They can be a few years old or a decade old.
• New: With a new dealership, you will only sell the latest vehicles in the latest models. 
• Independent: If you start an independent dealership, you will not have any contracts with major auto manufacturers. This will allow you to sell whatever brands you want.
• Franchise: If you start a franchise, you will enter into a legal agreement with a specific automaker and get a license to sell their vehicles. You will not be selling other brands outside of your contract.

With types of dealerships, you generally need to decide between franchise and independent, new and old. You can have a franchise that sells old vehicles or new vehicles. Or you can be an independent dealership and sell either new or old vehicles. 

If you want to start a dealership, you need to figure out the type of dealership you want to start and how much capital you need to get started. Then, you need to obtain the financing, property, inventory, and licensing to start. 

For more information about how to start an automotive dealership, contact a local company.