Do you have passion for cars?
Are you eager to earn your bread and butter with used car sale in Japan?
Do you like enjoy driving different cars from your inventory every day?
Do you like to take an opportunity to try yourself among Fortune 500 multimillionaire business?
Creating your own auto dealership may just be the next best step that you make after reading this article!
This article will highlight the few steps needed to start up an auto dealership. In the start you need to do a lot of working to cope with the challenges of your city, landlords, and the DMV. Then you need to learn the business process like managing inventories, financing, marketing, customer support, and last but not the least selling your cars to convert them into cash.
Starting your own used car dealership business
Learning and understanding the Business Model of Used Auto Dealership
The first thing required for any business is money. Let’s have a look how and how much money can be made through used car dealership business and what are some risks or drawbacks of this business. Reading this article will let you know if this business model is right for you at this time or not.
In Japan used cars sale, purchase business has enough potential to propel you to become a multimillionaire if you do right things in a right manner.
Used car dealership Business model
There are 4 main methods of making money through used car dealership business
- Selling Used Car to the dealers
- Selling Used Car to the end buyers
- Broker Used Car to get commission
- Providing services of auctions participating.
Below is the table that summarizes how much money you can expect to make on each sale as a Japanese used car dealer or seller.
- Selling Used car to end buyers: $500-$2,000 on each sale
- Selling Used Car to other dealers: $300-$700 on each sale
- Brokering Used Car: $250-$500 on each sale
- Auction services: $150 – $450 on each sale
As you can see the great potential in each way of business now get ready to explore how each business model does work.
Japanese used cars sale to End Buyers
The buyers visit the car lot or browse the online portals that many Japanese used car dealer have with complete stock listing. Then they negotiate with the sales staff and as they get done with the deal they finally pay you to purchase that car. This kind of transaction is sometimes called retail used car dealership.
Beside this kind of retail used car dealership there are other ways that allow you to put your Japanese cars for sale (http://www.sbtjapan.com/) in retail setting. These are the small yards, location or office location where you are actually permitted to sell a used car if you pass all the legal requirements. The best example of this is a auto repair shop, who can fix up these car direct to their customers.
Reasons of Higher Profit Margins through retail used car dealership
- A dealer may have had a used car that is in high demand
- A dealer may have bought the used car at a below wholesale price
- A dealer may have had to do very little repairs or the cost of repairing too little.
- The customer you are dealing with is a no haggle type of guy that bought the used car at its full retail price
- A dealer may putting Japanese used cars for sale that is a higher end car and may allow him to charge a premium price
- A dealer may have great service allowing him to charge a premium at his dealership
- A used car dealer may have a great plan for financing that will allow him to charge a premium at his dealership
Reasons of Lower Profit Margins Through Used Car Dealership
- A used car dealer may have had a car that is in poor demand or has been in inventory for a long time period.
- A dealer may have bought the car at above wholesale price
- A dealer may have had to do a lot of repairs or the repairs cost a lot to do
- The customer was very demanding, negotiating the purchase price down to below average levels.
- Your dealership may beating based on price thereby lowering the margin of the profit per car
One or the combination of above factors will affect the profit margin you will make in the Japanese used car dealership business.
Japanese used cars sale to other dealers
Another great way to make money is by Japanese used cars sale to other dealers. Most of the time dealers obtain used cars from auctions and sell it back to other dealers for a good profit. Normally and average profit margin is about $500 in this kind of business. But since there is less efforts and hassle involved in this kind of business, there are many dealers who are extremely successful in this kind of market.
In this type of business model you purchase a used car on behalf of other people who don’t have enough time. You serve as the middleman for other dealers and end buyers against a commission or a fee. Broker fees can be collected from either dealer or the end customer or from both. As a broker you should look to get $250 to $500 per transaction of used car.
It is just like the brokering used cars but the only difference is that you take the fees to let other dealers and end customers to participate and buy cars from auction houses.
So all these are the 4 basic business models for a used car dealership business and as I said it is not very difficult to make your first million dollars by doing used car sale business. At $1000 or $2000 profit per car, you will need to sell 500 to 1000 cars to become a millionaire. Breaking this into daily target, you have to sell only 3 cars a day.
Selling cars through used car dealership is indeed a business where a person with adequate amount of smarts, hard work, and passion can definitely become a millionaire in a year or two. I have seen many Japanese used car dealer who are now running their businesses in multiple companies. In Japan used cars sale through auction is very common so you can find the best point in Japan to start an effective cars inventory from Japan. You can even see many online websites that are offering used cars at very cheap prices. So if you think you can match above facts then you are the right person for this business.