You can buy and sell cars from your own home and make extra money every year. In the state I live in you can sell up to 3 cars a year without being considered a used car dealer. Most states have the same rule of thumb.
This means you can start selling used cars up to 3 times a year without going through the pain of getting an auto dealer license. Those that are able should take advantage of this rule and buy and sell cars for an extra side income. Specializing in certain vehicles can help you focus on acquiring inventory and mastering the sale side.
You can buy and sell Classic or Muscle cars as part of a hobby or stick to conventional autos. Finding a niche that is under-served in your area can be a profitable strategy. Examples: When I lived in NJ, a guy sold nothing but 86-87 Buick Grand Nationals. Another lot in town was called "Her First Car". Obviously they specialized in cars that appealed to the Ladies.
No matter what direction you go in as far as inventory the trick will be to squeeze the maximum profit out of each deal. Lets talk about the buy low and sell high process a little further.
The buying low
part of the equation is a good place to start. Why not find used cars
with minor problems and use the vehicles short comings to lower the sale
price and increase the profit. Example: a vehicle for sale
may have an oil leak. Bringing this to the attention of the seller can
reduce the price dramatically depending on where it's leaking from.
This doesn't mean you have to be a mechanic and fix it yourself. The most successful used car dealers I know couldn’t even put air in a tire. The key is to secure outside vendors for the repairs.
When you have the power of volume behind you as in that you will be sending lots of work to the auto repair shop you also have the power to negotiate a volume discount.
You can secure outside vendor's in the three major categories, which are mechanical, body repair and detailing. After you buy and sell cars for a while your relationship will grow strong with these repair centers. And the discounts and favors will happen more often increasing your profit margin even further.
The fact of the matter is that purchasing vehicles with problems can be the most profitable way to buy and sell used cars. Problems scare normal people but dealers are not normal people (my opinion).
Sometimes the seller will see a puddle of coolant under the vehicle and will put up a for sale sign without investigating the problem out of pure laziness. This is when you can give the seller 2 options.
Either they can accept your low price offer (thousands below book value) or they can let you bring the vehicle into your trusted car mechanic. Your personal technician should be able to provide a giant list That includes an estimate of repair to be subtracted from the asking price.
You will be surprised how often your crazy low offer will be accepted. Remember that buying and selling used cars may be risky at times.
You can wind up with a car that needs major repairs instead of minor repairs if your not careful. To minimize this risk form a relationship with a trusted auto repair shop.
You can even strike a deal on the side to have a mechanic available to go directly to the vehicle and perform an on site evaluation. I was approached by a used car dealer to do this. It was a great win win situation for us both. He would research private sale cars and find a couple of low price vehicles. He would set up the appointments and take me to the vehicles.
He would pay me for my time and buy me lunch. I loved to check out cars and trucks for him. This guy was a sharp negotiator he would use everything I found to shave thousands off the asking price.
Sometimes my shop would see the repairs of these vehicles and some times this guy would just throw a detail on the vehicle and flip it as is for giant profits.
This dealer made over 150k a year buying and selling used cars. His car lot was tinny and his inventory was under 25 cars for years. But the way he bought the cars and displayed them on his tiny lot made him steady money. I got to know this anonymous dealer very well. He started out selling his 3 cars a year out in front of his house on a high traffic street.
He was doing so well that he obtained his dealer license and quit his supermarket store manager job and started his own buying and selling car business. Last time we talked he had added 2 more small car lots to his business and was doing well with buy here pay here in house financing.
He liked the small lot approach because the rents where cheep and he could pack small amounts of inventory onto the lots making the business appear larger then it was. His inventory was perfectly diversified. He had a lot of high line cars that wear affordable due to being older units with high miles.
He also specialized in first time buyer cars like Ford probes and Chevy cavaliers. There was something for everyone that came on his lot! His latest buy and sell used car venture was the addition of a buy here pay here lot. He would self finance checked out buyers and make crazy money on the sale of the vehicle and the interest on the car loan itself.
Of course the trick with that is people have to pay or you have to reposes the vehicle. Save yourself a lot of trouble and make sure the title is clean on the target automobile. Getting stuck with a car that's unsellable due to paperwork problems will kill profits.
Give this buy and sell cars page a share or bookmark! Come back to check vehicle identification numbers.
Take a look my main page about this buy and sell cars for a living
subject. This start page is about getting a head start on the process of
making money with cars.
After you buy and sell cars for a while you may want to expand and get your own dealer license. I have provided some free information about this on the next page. Buy and sell cars with a car dealer license.
The homepage will provide more information about me and this automotive website. You can also find out how to get answers to car questions.