Start a used car business or not?

Tiddlywinks

Regarding sourcing stock... most garages do have a "banger man" that buys the trade-ins that are too old or tatty for their forecourts. The reality now though is that dealers are keeping older stock than they used to as times are hard and Joe Public's willingness to spend money is dwindling. The cars they do sell on will not have been serviced and you will have to consider that the previous owner might be trading it in because there is a fault they haven't made the dealer aware of. How will you ensure, as a trader, that you make the car roadworthy and reliable before selling it on?

Similarly, with auctions - why do seller usually choose to send cars to the rooms? Yes, some just can't be bothered to put the work in themselves but others will be using it as the easiest way to get rid of a problem as auctions tend to be "sold as seen" and the description usually carries a warning that buyers need to make their own mechanical checks.

I think you need to sit down and work out what you need to "earn" net each month in order to live and then work backwards. How many cars will you need to sell to achieve this figure? Remember that you will need to take into account tax (corporate or personal depending on your entity status), trade insurance and VAT (it won't take too many sales to get over the limit) plus planning for a rainy day, illness and pension.

You also need to be clear as to your target market - cheap and cheerful and sell loads or more selective with less sales. The more expensive you go, the higher the customers' expectations for facilities such as warranties, finance packages and accessible premises to allow independent vehicle checks etc.

You need to think long and hard before you spend your money - you need to have looked at the sector, competition, legal requirements and have a pen portrait of your target customer.

Good luck.