Opening an independent dealership with repair shop

M Leindekar

Hello all and thank you for accepting me! I've been reading this forum for quite a while and I'm glad there are so many people in here willing to share experiences and help each other, I'll do my best to contribute whenever I can. In the past I have worked in retail and mid level managing and owned a small business but not related to cars. When I was younger I sold a few and found myself enjoying it and quite comfortable doing it. I'm very computer savvy, detail oriented, methodic and a DIY guy, I'm not a mechanic, just a car enthusiast but I know how to perform the basic stuff and what to look when buying a unit. That being said I have around 150 grand in savings to start something. I know many of you will be laughing at this point and I know that's not too much but I plan to start small, very small (not more than 5 or 7 cars and a bay to perform repairs and grow from there), the cars will be bought, not floored. If needed I'm willing not to get a salary for the first year. My plan is to sell cars no older than 12 years and with less than 130.000 miles, mostly small, mid size and SUV's. No luxury cars or trucks for now. I plan to hire a full time mechanic, a salesperson, a receptionist/clerk and a detailer. The city where I live has a pop of 35.000 that ascends to 80.000 more in surrounding areas (no big cities around). I already have a business plan in place and a monthly cash flow for the first 12 months. All expenses included I'll have an overhead of $18000/ month for both the dealership and the shop ($2000 of that is listed as a monthly cushion under "other expenses"). I've been looking to all the aspects I can think of from getting a lawyer, accountant, licensing, bond, insurance, dms, crm, on site marketing strategies, auctions, etc, etc, etc and reading A LOT. The thing is, I've been VERY conservative and pessimistic when doing the projections and still I see good numbers. 

I know that just this description is a very vague picture of the whole thing, but what steps do you think I should follow? I'm committing suicide here? I'm missing something obvious? What's your advice? How did YOU started? Your opinions will be GREATLY appreciated!

Chris K Leslie

How exciting to be starting something like this. 

A good friend of mine has been going through the same thing and just signed the lease on his building last week. 

being ok with not having everything at 100% before you start is probably the hardest part to get over.

Just keep in mind that it's easier to add things down the road. It's always harder to remove them. 

Congratulations on taking the initiative to start your own business! How exciting! Have you thought about a marketing plan and what you're going to do to get the word out on your dealership?

Matteo Batelli

Congratulations. You mention  that no more than 5-7 cars. Your monthly expense is around 18,000$ the inventory size is little less for the expense, I guess. If you are going to make more revenue with the repair shop, thats even much for the month,.

Thomas F. Jung

My advice having run a very successful independent shop is to specialize.  Be better than anyone else in whatever you specialize in -  may that be a make, hybrids, trucks...  Good luck.

Joe Henry

M., I put myself through college doing what you are doing but that was the mid 1970s (I'm an old old dog, lol). But today's workforce is not your father's workforce. My present business is recruiting and staffing dealerships and shops. Finding a mechanic/Tech in a sparsley populated area is hard. Also we have many new auto repair franchises contact us when they first start and despite the rosy picture that the franchisor paints (and being an ex-independent repair shop owner myself), I advise them to do as much of the work as they can themselves and not hire until they absolutely needed. Also, are you doing BHPH? If not, finding finance for customers will also be something to get done before you pull the trigger. My dad did BHPH for decades until the day he died. He use to say "Son, some people say it is not what you sell the car for, it is what you buy it for. That's hogwash son, it is all about selling the same car over and over." Hope this helps!!! - Joe Henry    

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