Motor Trade Finance

M

Michaeld

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31
Hi,
Currently looking into setting up a car sales company and am just wondering does anyone know what way the finance works or what rates or basically any general information.

This is only preliminary stages and would like to find out abit about it before I go any further.

Cheers in advance
 
Can anyone shed some light on this?
Tried googleing it and nothing, any info greatly appreciated.
 
I dont understand your question.

Are you asking how you should go about financing your new car sales business? If so I suggest you engage a good accountant.

Perhaps you are asking how car purchace finance works?

aj
 
Apologies ajapale,

Yes, Im asking how you should go about financing a new car sales business, is their any website etc. that would give me a bit iof information about the above.
 
Michaeld, Do you mean to say you are looking for a business loan ?
In that case theres plenty of banks around but I d think it would help if you put together a business plan and also put some of your own money into the deal and werent relying solely on a loan to finance everything.
 
Hi Sign, i would be putting up alot of my own money, i was just wondering if there is a different type of finance for the motor trade? like developers finance for construction. and i was wondering how it works?
 
Hi Michaeld, How does developers finance for construction work ?
 
Look for an accountant with experience in the motor trade. To be honest if you have to ask these questions you are a long way from being able to run the business side of the business.
 
@ Purple - im looking at set it up in approx. 18 months time, so I want to build up as much knowlege as i can about the business side of it hebnce questions like this.

All I wanted to know was there types of finance avalible specific to the motor trade and how they work.
 
Hi Michaeld

If you enter agreement with a specific manufacturer, they will give you a certain amount of funding towards brand awareness, promotion etc.

The premises you deal from, will most likely be somewhere a bank can offer finance on, although the Bank will also want you to put some of your own funding into the property.

Financing the motor stock you put into your business will probably come from a mix of a few sources - some distributors / manufacturers give particularly attractive credit terms, when dealers take on their brand. Banks (particularly those will strong motor finance arms) offer stock financing options to go alongside any deal you may get from a distributor ... finally, you'll again need some of your own funds to assist with carrying stock, spares etc.

If you are intending to install a car / truck wash as part of the project, you can obtain bank finance for this, generally over a 5-year period.

Commercial Insurance premiums can usually be financed over 12 months also, which may help with start up costs.

Hope this is of some help to you.

Cheers

G>
 
I know from a friend in the business that lending companies give incentives to garages to who pass on customers to them for financing the vehicles they purchase, quite a siginificant amount. If you want contact info pm me and I will put you in contact. All the best, optimistic
 
Hi Micheal,

Forget the financing for a minute,

You should find youself a good dealer in the UK or up north. Ideally you should think about going to auctions in the UK. Get a loan for about 30k from cred union or bank. Buy 3 x Toyota Corrolla's (98 - 04, very good selling car. After VRT is paid, you should clear about €6 - 8k. Pay off loan Do this twice and there you go 16k to start your car sales business.....repeat process.

I have 3 friend that started the exact same way, all 3 now have car transporter lorries! and are turning over profits of about 8-10k a week. One of them works from home out of a garden shed. Started off selling 1-2 cars a week, now selling about 6. Everyone of them a Toyota Corolla....

I think he still even gets his dole money on a Thursday.....
 
BOC_ARDEE said:
Hi Micheal,

Forget the financing for a minute,

You should find youself a good dealer in the UK or up north. Ideally you should think about going to auctions in the UK. Get a loan for about 30k from cred union or bank. Buy 3 x Toyota Corrolla's (98 - 04, very good selling car. After VRT is paid, you should clear about €6 - 8k. Pay off loan Do this twice and there you go 16k to start your car sales business.....repeat process.

I have 3 friend that started the exact same way, all 3 now have car transporter lorries! and are turning over profits of about 8-10k a week. One of them works from home out of a garden shed. Started off selling 1-2 cars a week, now selling about 6. Everyone of them a Toyota Corolla....

I think he still even gets his dole money on a Thursday.....
Click to expand...

Why arent you doing this then if its so easy?
 
Michaeld, I would go and talk to a bank about the different ways of doing this, take in as much info as possible and then if you are unclear about something then ask a specific question other wise this thread could go on forever. There's to many in's and out's.

BOC ARDEE, you should just stop right there and say no more. It's clear all you have is second or third hand info. It's worth nothing. If the 3 lads above are doing as you say and not registered as a business there registering around 350+ cars a year in there name (each). They would be in jail by now for all sorts of fraud. Take a look at carzone etc, there a wash with corolla's, so in order to be selling them you would have to be selling them cheaper that cheap to move them on. Cars might be cheaper in England etc but the VRT sorts out most of that, so the profit your talking about isnt real.

The money you pay each year for your franchise is small as to the money invested in training and equipment and showrooms. Dealerships are million euro businessess now a days. Fact is if you dont have that sort of money you wont surrive.
 
Well at the start it would be an independent car sales selling the likes of corrollas , a range of diesels and light commercials.

@Optimistic- thanks , i may be looking for that contact in the near future.

@BOC AREE - I sold 7 corollas lat summer and ended up making very good money off them, buts very hard going to get a good contact and source good cars, alot of auction cars are very tired and wont command very good money so theres a bit of work in sourcing the stuff.

@Mr2 - I wouldnt agrre with if you dont have franchaise/dealership that you wont survive. I know a lot of people around the country that are independents are making a very lucrative living off it. Obviously it would be the most ideal thing but at least ill be abour 25 when this comes together so time will be on my side to attract brands in the future.

Thanks to evety one that posted so far, keep it coming im learning all the time.
 
First things first, You'll need to learn to spell.

You're going to be very small from the way your talking, even poss part time. Your prob looking at these other lads around the country and think small and easy but you have to look closer.

Site, stock, Insurance, computer, phone, advertising, are for starters.
Showroom, workshop, valeting, all would be next.

Best thing to do is get a business plan and work out cost's of everything.
Electricity, internet access, everything. I really think your going to get a shock.
 
@ Mr2 - thanks for the advice, the above thread was written in great haste and I didnt read over it to ensure no spelling mistakes. My Apologies.

Next on the agenda will be to cost everything and put together a detailed business plan.
I intend to start small possibly 5 or 6 cars part time and then grow as the business does. I already sell cars on a part time basis (actually sold one last night) so its really just the next step from that.
 
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