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Discuss New Guy Looking for Advice in the General Car Biz Talk forum at Car Dealer Forums; Hello everyone, My name is Blake and I come here seeking some opinions, comments and ...
  1. #1
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    Jan 2015
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    Default New Guy Looking for Advice

    Hello everyone,

    My name is Blake and I come here seeking some opinions, comments and general advice for me as I start my own used car dealership in Las Vegas, NV.

    My business partner and myself have 5 years in the business. My experience includes new and used sales, BDC/Internet Director and finance. My business partner has 3 years of experience desking with a large focus on sub-prime deals. We have both worked for large new car franchise dealers so starting our own small strictly used car lot is a new area for us. But it is something that we have a passion for and we are both tired of working for other people. I have formed an LLC for this business.

    I want to start this business off very small and grow as we learn more, I have $10,000 at my disposal with the means to borrow another $10,000 from other means if needed. I plan on using a flooring plan through either AFC or Nextgear for $25,000 to finance my first string of inventory. Through Nextgear and AFC I am looking at a 60-30-30 flooring plan. I want to focus on sub-prime loans and cheap cars and cater to customers with challenge credit or low income. My goal would be to convert into a BHPH lot once we can raise enough capital. Through my experience in finance and my partners experience on the desk we have some good relationships with local sub-prime banks and credit unions for stronger credit.

    I want to start off with 10 cars, that cost me something like this; x3 $700 cars, x4 $1500-2000 cars, x3 $3500-4500 cars. I am looking at finding a good warranty company that would allow me to sell additional coverage on vehicles when I can. My goal is to keep all over-head at a mimimum, ideally 3,000-5,000 a month including rent, utilities, insurance, surety bond and anything else.

    I thought that my experience in the business would of made the learning process easier but I have learned over the past month that I under-estimated the complexity of starting my own. I want to make sure that I have taken everything into account and have at least a understanding of everything I need before I file the paperwork for the license and seriously look at different properties. I feel like I have a good understanding so far but also feel like I am missing some key pieces. I lack experience with the auction scene which is my main concern. Also finding a suitable property in my area of proving difficult.

    I would greatly appreciate any input you guys can give me on the information that I have provided so far. Any suggestions or tips you may have would also be greatly appreciated.

    Thank you in advance


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  2. #2
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    Default

    It's a tricky business. Especially older cars that need to get fixed up. You need to know a lot about cars to be able to know the value of them and calculate your margins, and then you may run into issues when you leave the lot or person's driveway, haha.

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