Capital investments – from 45,000 rubles.
► Recovery period: 1-3 months (1 transaction).
Many business ideas have something for motorists…
As a matter of fact, the car resale business is best suited to people who have a professional attitude towards them, or at least self-taught hobbyists.
However, in addition to sincere interest, the resale of a car requires special skills, the talent of the seller and a qualitative analysis of prices in the automotive market.
Stages of the project for the resale of cars
There are several steps to resell a car.
The essence of the matter is simple: buy, order and sell to a new client or just mediation.
Approximate car resale scheme:
- business registration;
- analysis of the market supply of prices for cars;
- buying a car;
- prepare the car for sale;
- placement on trading floors.
Paperwork for business
The first thing you need to decide is how you are going to work: legally or without registration.
At the initial trial stage, you do not need to register a business; you can test a niche, evaluate interest in a business.
However, over time, as you gradually expand your business, you will need a car dealership and appropriate premises.
Therefore, you will surely come to the conclusion that you cannot do without official registration (IP, LLC or JSC.
The most profitable taxation system is simplified, with individual entrepreneurship (IP).
To process documents for a company, it is enough to submit an application with a passport to the nearest tax office.
The procedure itself is extremely simple and you can easily cope with it.
Analysis of the car resale market
The next step should be to analyze the market: what cars are in demand and at what price they are sold.
First of all, now there is a demand for inexpensive foreign cars.
Foreign cars of the last years of production require large financial investments, not only when buying, but also when repairing, if necessary.
Good demand for domestic cars.
In any case, it is worth focusing on prices so as not to overpay!
People who are in this business are advised to start with a domestic manufacturer.
Our VAZ, GAZ and UAZ can be bought for less money (from 30,000 rubles).
Therefore, your investment will be minimal.
At the same time, these cars are in demand, and you can earn from 10,000 to 25,000 rubles on their resale.
A foreign car can be resold at a higher price, but the investment in buying a car will also be higher.
When you get comfortable in this business, you will be able to deal with imported cars.
Your profit on them can reach up to 100,000 rubles.
Buying a car for resale
This is perhaps the most crucial step in the case.
Here you will need special professional knowledge to determine the technical condition of the car, to identify its hidden flaws.
The price of a car is affected by:
- year of issue,
- mileage,
- equipment,
- technical condition,
- condition of the body and interior,
- season of the year at the time of sale.
A profitable purchase for you is a minimum investment and a maximum profit.
Sometimes it makes sense to buy a car with minor flaws.
But the nature of these failures must be properly assessed.
That risk is not buying a car that will require a lot of investment, or not falling in love with a merchant who sells “firewood”.
Car pawnshop as a business: a detailed action plan
Where to look for cars for resale?
You need to look for cars on thematic sales sites, in newspapers, in car markets.
You can advertise your own car purchases.
When you find a suitable option, contact the seller immediately.
There are many people who do this kind of thing.
Hence, a cheap car is sold during the day.
Make an appointment and inspect the car in person.
The most valuable are cars without repainting the body or with a decent factory coating.
Firstly, if body painting is required, then it takes a lot of time, because the process is laborious.
Secondly, this is one of the most expensive types of auto repair.
Therefore, carefully inspect the body in good light for flaws, rust and dents.
If the car is repainted, this fact can hide the repair and straightening of the body after an accident.
This means that there may be other hidden shortcomings: at best, they will be compensated, at worst – disguised.
Documentary support for the resale of cars
Next, you need to familiarize yourself with the documents for the car – a registration certificate or a general power of attorney, if any.
It is better to buy a car only if the seller has a registration certificate.
It is advisable to find out in the traffic police about the presence of fines, whether there is an arrest on the car, whether it is listed as stolen.
Then you decide how to formalize the transaction: as a purchase and sale or by general power of attorney.
By general power of attorney, the actual owner of the car can revoke it.
Then you will be left without money and without a car. This is how scammers usually work.
Or, if there is an arrest, the car is taken to the ticket area at the first traffic police post.
Be sure to pass a test for compliance with the VIN number of the body, engine with the registration certificate.
There are craftsmen who digest the frame itself with the VIN number.
Therefore, you yourself will not always be able to cope with this problem.
You also need to know for each car brand where to look for this number.
Tire business plan: a detailed guide from scratch
Preparing a car for sale
The most important thing to do is to put the car in order so that it looks attractive.
As they say, “comb your hair and make up your lips.”
Don’t overdo it!
The sale of the car must be at a reasonable price.
The buyer should not have a question: why part with such a “doll”?
Although such questions are still being asked.
People don’t like dealers.
I prefer to buy a car from the owner.
This is another argument in favor of registering the car itself, and not issuing a general power of attorney.
And it is better to answer questions like this: I urgently need money.
The car may need a facelift.
There are options that require more serious troubleshooting.
But if you know how to do it yourself, it remains to calculate the profitability of repairs – the ratio of investments in repairs and purchases, with the profit that you want to receive.
Be sure to clean the car, wash, polish.
Update floor mats and covers as needed.
Correction of minor problems.
After that, you can put the car up for sale.
Take pictures of the car from different angles.
High-quality images are the key to quick calls from buyers.
Place advertisements for the sale of cars on popular sites on the Internet, let’s advertise in newspapers.
Don’t forget the car market.
There are 4 ways to resell a car:
“The most important thing when thinking about a new idea is not to get bogged down in complexity. Any fool can do something difficult. It’s much harder to do something simple.”
Richard Branson
- Buy, wash, powder, sell (15% profit).
- Buy, repair, clean, polish, sell (30% profit).
- Buy, promote, fix, sell.This modality is associated with the acquisition of a vehicle in another region of the country or even abroad.
- Find, take a commission, sell.In this case, an agreement is concluded with the owner of the car, according to which he leaves the car to you on the territory of the exhibition, and you undertake to sell it.At the same time, you set your margin, commission.If the car is not for sale, the owner takes it, but pays you the amount of “overexposure” days.
We analyze the financial part of the resale of cars
Let’s calculate the minimum costs for buying a car and preparing it for sale according to the “buy, wash, spray, sell” scheme.
| Cost type | Quantity (rub.) |
|---|---|
| car cost | from 30 000 |
| Paperwork | up to 3000 |
| “Cosmetics” before resale: local painting, polishing, covers, rugs. | 6500 + 5400 + 1100 = 12000 |
| Total: | 45 000 rub. |
The resale price will depend on the year of manufacture.
Our calculations include the price of a car from the 1980s and 1990s.
Such cars in good condition are sold for 60-70 thousand rubles.
Those your profit will be 15-25 thousand rubles.
Business Profitability
In order for the car resale business to generate a stable income, you need to buy several cars.
They are sold at different times.
You can sell a car in one day.
And it happens that the “shooting option” stalls for 2-3 months.
I will also add time to bring the car in order.
But, on average, the car “leaves” in a month.
The most successful season for car sales falls on the period from spring to October-November.
In cold weather, SUVs sell better.
A sports car in the warm season will be bought faster.
How to bring the car resale business to a high level of profitability, see the video:
The main risks of business in the resale of cars
A few words about trading risks:
- The biggest risk that is difficult for the average person to predict is the economic crisis and fluctuations in the dollar.That is, the car after the purchase can become cheaper.
- You may encounter scammers who sell a car with fake documents, etc.
- The car may break down after purchase.Then you have to invest in repairs additional funds, and this is not always profitable.
- In the same way, the buyer can cancel the purchase at the last moment before the conclusion of the transaction.To avoid this option, you must write an agreement with detailed obligations.
Lastly, a couple of tips…
Reselling a car as a business goes well with commitments such as car service or parts dismantling.
If you own an auto repair shop, it will be easier for you to expand your business by reselling cars.
You can choose machines that need repair if you have the space, tools and skills.
When dismantling cars for parts, the “hanging” version can be sold in parts in order to at least go to zero.
In any case, good luck with a profitable purchase and the speedy sale of a car will not hurt you.
