Vehicles are an essential part of households, as well as businesses. Depending on the purchasing power, one may choose to own a new brand vehicle, buy a used one or simply lease it. Automobile dealers address this particular need of consumers. A vehicle dealership refers to a business that sells new and used vehicles, vehicle parts and equipment on a retail basis. The vehicle dealer primarily has a dealership contract with the automobile manufacturers and usually employs sales executives to execute the sale process. These dealers additionally offer repair and maintenance services, services of trained automotive technicians and assists in financing.
Vehicle dealers like Seattle Dodge truck dealers is a great choice for those who reside in that area and are looking for good deals. There are several options that one can choose from a vehicle dealer including new and pre-owned Ram trucks, Jeep, Dodge, Chrysler and other brands of cars, trucks, and vans.
Format of Dealership
A new car dealership generally has an association with a minimal number of automobile manufacturers, wherein a used car dealer has an association with multiple auto-manufacturers. Certain new car dealers may deal with numerous brands of the same manufacturer whereas in other cases, a single dealer may be the owner of various dealerships of several automobile manufacturers.
Additional services provided by car dealers:
- Apart from the regular warranty coverage, clients may want to cover their vehicles against any mechanical failures in the future. Service contracts are similar to the ones offered by vehicle manufacturers. There are three kinds of service contracts. The first type of service contract is provided directly by manufacturers through dealers. Here, dealers can submit their claim to manufacturers once they give the services. In the second type, dealers purchase insurance policies in wholesale which are administered by third-party. In the third type, one can directly purchase service contracts from automobile insurance companies.
- Insurance for the protection of loan against total loss of vehicle in the event of theft or accident and coverage for the loan in case of death of the borrower within the contract term. A great example of this type of insurance is one sure insurance.
- Accessories and maintenance agreements.
- Vehicles leased to customers with weaker financial backgrounds for about a year to 3 years.
Tips for opening up a car dealership business:
- The first question is to decide whether you want to deal in new vehicles or pre-used ones. Deciding on the format of the dealership is essential as it is indicative of the size of the initial investment required to start the business.
- The second tip is to wisely decide on the business plan including the sources of financing, dealership format, cost of the setup, employee remuneration, advertising, and promotion budget, etc.
- The third tip is obtaining a dealership license that allows selling unlimited car annually. Car dealership also requires a surety bond to protect from contract defaults and comprehensive coverage of insurance against general as well as specific liabilities.
- Next tip is to decide on the right location smartly. It plays a significant role in your visibility, drawing traffic, and dealing with competition.
- Last but not the deal, the most important tip is to adhere to the law of the land. Law requires you to disclose your business activities completely.
