business plan sample for car dealership

Car Dealership Business Plan Template

Written by Dave Lavinsky

Car Dealership Business Plan

Over the past 20+ years, we have helped over 4,000 entrepreneurs create business plans to start and grow their car dealerships. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a car dealership business plan template step-by-step so you can create your plan today.

Download our Ultimate Car Dealership Business Plan Template here >

What Is a Car Dealership Business Plan?

A business plan provides a snapshot of your car dealership as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for Your Car Dealership

If you’re looking to start a car dealership or grow your existing car dealership you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your car dealership in order to improve your chances of success. Your car dealership business plan is a living document that should be updated annually as your company grows and changes.

Source of Funding for Car Dealership Businesses

With regards to funding, the main sources of funding for a car dealership are personal savings, bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business.

The second most common form of funding for a car dealership is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan.

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Your business plan should include 10 sections as follows:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of car dealership you are operating and the status; for example, are you a startup, do you have a car dealership that you would like to grow, or are you operating a chain of car dealerships.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the car dealership industry. Discuss the type of car dealership you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

In your company analysis, you will detail the type of car dealership you are operating.

For example, you might operate one of the following types:

• New Car Dealers : this type of car dealership business typically sells both new and used passenger vehicles. Usually, this type of dealership also has a service department and also sells parts.
• Used Car Dealership : this type of car dealership sells used passenger vehicles, including cars, light trucks, sports utility vehicles (SUVs) and passenger vans.
• Online Car Dealership : this type of car dealership retails automobiles online to consumers and businesses and provides services to aid in the purchase of automobiles. Some players offer their customers trade-in, car financing and car selling services.

In addition to explaining the type of car dealership you operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new store openings, etc.
• Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the car dealership business.

While this may seem unnecessary, it serves multiple purposes.

First, researching the car dealership industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards vehicles, it would be helpful to ensure your plan calls for plenty of options.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your car dealership business plan:

• How big is the car dealership business (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your car dealership. You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your car dealership business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: college students, soccer moms, baby boomers, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of car dealership you operate. Clearly baby boomers would want a different atmosphere, pricing and product options, and would respond to different marketing promotions than college students.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most car dealerships primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other car dealerships.

Indirect competitors are other options that customers have to purchase from that aren’t direct competitors. This primarily includes private sellers. You need to mention such competition to show you understand that not everyone in the market for a car shops at a dealership.

With regards to direct competition, you want to detail the other car dealerships with which you compete. Most likely, your direct competitors will be car dealerships located very close to your location.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What types of automobiles do they offer?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to stand outside your competitors’ locations and ask customers as they leave what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide superior products and/or services?
• Will you provide cars that your competitors don’t offer?
• Will you make it easier or faster for customers to acquire your products?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a car dealership business plan, your marketing plan should include the following:

Product : in the product section you should reiterate the type of car dealership that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, in addition to selling new cars, will you offer leasing options?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the inventory you will maintain and the price ranges.

Place : Place refers to the location of your car dealership. Document your location and mention how the location will impact your success. For example, is your car dealership located next to a high-traffic retail area, or on a main thoroughfare, etc. Discuss how your location might provide a steady stream of customers.

Promotions : the final part of your car dealership marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Making your car dealership extra appealing to attract passing customers
• Pay per click advertising
• Advertising in local papers and magazines
• Reaching out to local bloggers and websites
• Social media advertising
• Local radio advertising
• Banner ads at local venues

Building Trust

Building trust between a car dealer and its customers is vital to a successful sales strategy. This should be clear in the business plan, where funders look to see the feasibility of the company once it’s launched. Earning customer trust is important because of the bad reputation, deserved or not, for car salespeople to try to take advantage of customers and because of the high amount of stress which the purchase of a large item like a car causes for buyers.

Below are the best ways to build trust in your customers.

Referrals and Testimonials

Running a dealership with a heavy focus on satisfied customers referring other potential customers can create positive word-of-mouth between contacts who already know and trust each other. An additional element to this is securing testimonial statements (either written or videotaped) from happy customers. This requires having those happy customers in the first place, as customers can sense if the testimonials are canned and will mistrust even further.

Transparency

If auto dealerships were extremely clear about all pricing, fees, and costs of ownership up front, customers might change their opinion of these companies. However, too often there is a great focus on a low sticker price to attract customers who later on feel they’ve been lied to when all of the add-on charges are explained. Can your dealership change this industry practice and make transparency into a competitive advantage?

Taking Your Time

By taking the sales process at a rate that the customer is comfortable with, you recognize that it is a difficult step for customers to walk into the world of the dealer and play on his home turf, so to speak. They will be feeling defensive and a bit thrown off, so tell them that you will take the time to answer any questions they have and to make sure they understand and have considered their options before moving forward.

Operations Plan

While the earlier sections of your car sales business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your car dealership such as serving customers, completing necessary paperwork, keeping the dealership clean, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your 1,000th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch a new location.

Management Team

To demonstrate your car dealership’s ability to succeed as a business, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in the car dealership business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in car dealerships and/or successfully running retail and small businesses.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you serve 20 customers per week or 75? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your car dealership, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt. For example, let’s say a company approached you with a $1,000,000 fleet order, that would cost you $500,000 to fulfill. Well, in most cases, you would have to pay that $500,000 now for inventory, transportation, employee salaries, etc. But let’s say the company didn’t pay you for 180 days. During that 180 day period, you could run out of money.

In developing your Income Statement and Balance Sheets, be sure to include several of the key costs needed in starting or growing a car dealership:

• Location build-out including design fees, construction, etc.
• Cost of equipment like computer hardware and software, etc.
• Cost of maintaining an adequate amount of supplies
• Payroll or salaries paid to staff
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint or location lease.

Car Dealership Business Plan Summary

Putting together a business plan for your car dealership is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the car dealership business, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful car dealership business.

Download Our Car Dealership Business Plan PDF

You can download our car dealership business plan PDF here . This is a business plan template you can use in PDF format.

Car Dealership Business Plan FAQs

What is the easiest way to complete my car dealership business plan.

Where Can I Download a Car Dealership Business Plan PDF?

You can download our car dealership business plan PDF template here . This is a business plan template you can use in PDF format.

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Other Helpful Automotive Business Plan Articles & Templates

Car Dealership Business Plan: Complete Guide

• January 11, 2023

Whether you’re looking to raise funding from private investors or to get a loan from a bank (like a SBA loan) for your car dealership, you will need to prepare a solid business plan.

In this article we go through, step-by-step, all the different sections you need in your car dealership business plan. Use this template to create a complete, clear and solid business plan that get you funded.

1. Executive Summary

The executive summary of a business plan gives a sneak peek of the information about your business plan to lenders and/or investors.

If the information you provide here is not concise, informative, and scannable, potential lenders and investors may lose interest.

Though the executive summary is the first and the most important section, it should normally be the last section you write because it will have the summary of different sections included in the entire business plan below.

Why do you need a business plan for your car dealership?

The purpose of a business plan is to secure funding through one of the following channels:

• Obtain bank financing or secure a loan from other lenders (such as a SBA loan )
• Obtain private investments from investment funds, angel investors, etc.
• Obtain a public or a private grant

How to write an executive summary for your car dealership?

Provide a precise and high-level summary of every section that you have included in the business plan. The information and the data you include in this segment should grab the attention of potential investors and lenders immediately. Also make sure that the executive summary doesn’t exceed 2 pages.

The executive summary usually consists of the 5 main paragraphs:

• Business overview : introduce your car dealership: what is your business model (franchise vs. independent business ; new vs. used car dealership), how many cars will you have in inventory? Are you partnering with any car manufacturer(s)? Where would your store be located? Etc.
• Market overview : briefly analyze the car dealership industry in your area ( market size and growth), your competitors and target customers: average income of your target audience , demographic distribution, customer preferences etc.
• Management & people : introduce the management team and their industry experience. Mention your business partner(s), if any. Also give here an overview of the different teams, roles and their reporting lines
• Financial plan : how much profit and revenue do you expect in the next 5 years? When will you reach the break-even point and start making profits? Also include here a small chart with your key financials (revenue, net profit )
• Funding ask : what loan/investment/grant are you seeking? How much do you need? How long will this last? How will you spend the money?

Car Dealership Financial Model

Download an expert-built 5-year Excel financial model for your business plan

2. Business Overview

In the business overview section of your car dealership business plan, you should expand on what your company sells, to whom, and how it is structured. A few examples of questions you must answer here are:

• The history behind the project: why did you choose to open a car dealership today?
• Your business model : Are you franchising or is this an independent store? Are you selling new or used vehicles?
• Products & services : What vehicles / brands do you plan to sell? Are you planning to add any additional services (e.g. car repair & checkups, etc.)
• What is the legal structure of your company? Who are the directors / shareholders?

a) History of the Project

Briefly explain how did you come up with the plan to start a car dealership business. What motivated you to get into this business venture? 

Also try to demonstrate to investors your interest and passion for the car industry and car dealership in general.

For example, you might have worked in a car dealership and/or at a car manufacturer sales department in the past, and found immense growth potential for this type of business in your area.

b) Business Model

Explain in this section what business model you chose for your car dealership. Here are a few questions you must answer:

• Will you start an independent dealership, franchise model, chain store, etc.?
• Will you open a brand-specific dealership?
• Would your car dealership deal in new cars, used cars, or both?
• Do you plan to open an online dealership?
• Would you offer service and repairs in your car dealership?

c) Products & Services

Now that we have briefly introduced what your business model is, you must explain in detail what exactly you intend to sell. There are 2 things here:

• Products (cars): what vehicles and brands do you intend to sell? Why did you choose these vehicles / brands?
• Services : if you offer additional services (e.g. car repairs, checkups), explain what they are

In addition to the products and services , you should also include a list of prices for each. Of course, this doesn’t need to be exact. Car prices fluctuate based on various factors. Yet, you must be able to provide a range of prices for each category (e.g. sedan, luxury cars, vans, etc.).

If you specialize in a specific brand, you can provide a list of prices per model in appendix as well.

The prices are important as they will allow investors to tie your product offering with your financial projections later on.

d) Legal Structure

Explain the legal structure of your nursing home in this section. Are you starting a corporation, a limited liability company, or a partnership? Who are the investors? How much equity do they actually own? Is there a board of directors? Do they have prior industry experience?

3. Car Dealership Market Overview

A complete understanding of the car dealership industry is important for the success of your business.

Therefore, you must cover here 3 important areas:

• Status quo : how big is the car dealership industry in your area? How fast is the market growing? What are the trends fuelling this growth (or decline)?
• Competition overview : how many car dealership competitors are there? How do they compare vs. your business? How can you differentiate yourself from them?
• Customer analysis : what are your target customers? What are their customer preferences?

a) Status quo

When looking at the car dealership industry, try to start at the national level (US) and narrow it down to your service area (a city for example). You should answer 2 important questions here:

How big is the car dealership industry in your area?

How fast is the car dealership industry growing in your area, how big is the car dealership industry in the us.

The auto parts and car dealership industry in the US is huge: it was worth $1.18 trillion in 2021 as per the National Automobile Dealers Association . As per the same report, there were 16,676 light vehicles car dealerships in the US in 2021 which generate an average revenue of $71 million.

Sales are divided between new (52%) and used vehicles (37%) as well as services and parts (11%).

After the US, assess the size of the car wash industry in your city or area. Focus on the zone where you plan to offer your services.

Naturally, you might not be able to get the data for your specific city or region. Instead, you can estimate the size of your market, for more information on how to do it, read our article on how to estimate TAM, SAM and SOM for your startup .

Luckily, NADA publishes statistics per state so you can narrow it down easily. For your city instead, you will need to do work out some estimates. To give you an example, let’s assume you plan to operate in an area where there are already 30 car dealership businesses (in a 25 miles radius for example).

Assuming our business is based in Connecticut, we can use the state’s average annual turnover of $49,661 : we can reasonably assume that the car dealership industry is worth $1.5 million in your area . In other words, there are over 35,100 light vehicles (new and used) being sold in your area each year (assuming the average retail price of $43,000).

Now that we know your area’s market size, let’s look at growth instead.

Fortunately, you can use NADA’s number again as they publish annual reports. Just use your state’s market size growth, and explain the growth (or decline). This can be due to average car prices, or volume.

b) Competition overview

You should discuss both your direct and indirect competition in your business plan. Other car dealerships in the region will be your immediate competitors. Internet auctions, individual dealers, etc., will be your indirect competitors. 

In this section, you should also discuss the essential components of the business models of your main competitors. Your research should be focused on their clientele, the kinds of cars they offer, and their strengths and weaknesses .

A thorough competitive analysis is crucial as it may allow you to discover and address a customer need or preference that none of your rivals is addressing today.

Here are some of the questions that you must answer in this section:

• How many competitors are there in the area where you want to open your car dealership?
• Are they franchises or independent stores?
• Do they partner with specific car manufacturers?
• What type of cars do they offer (luxury, economy, used, new, etc.)?
• What is the average price range of the cars they sell?
• How many employees do they have?
• Do they offer services and repairs?
• Do your competitors offer buyback on the cars sold by them previously to the client?
• What type of offers and discounts do they offer to attract customers?
• How many cars / vehicles do they sell on average per month?

c) Customer analysis

Now that we have a good idea of the car dealership industry in your area as well as competition, now is time to focus on your target audience: customers.

Knowing your customer is extremely important before you get into any business. This is all the more relevant for car dealership where customer preferences and tastes are very different.

For example, if you are planning to get into a luxury car dealership business, you should look into:

• The estimated population of high-income people in your area
• Types of luxury cars that are in demand (hatchback, sedan, SUV, etc.)
• Shopping preference of your target customers (online or offline)
• How frequently do they buy (or exchange) new cars?
• Is their buying decision influenced by offers or discounts?
• What features do your target customers want in their new luxury cars?
• What type of additional services do they expect from their dealers?

4. Sales & Marketing Strategy

This is the section of your business plan where you outline your customer acquisition strategy. Try to answer the following questions:

• What are the different marketing strategies you will use?
• What are your Unique Selling Points (USPs)? In other words, how do you differentiate from your competitors?
• How do you intend to track the success of your marketing strategy ?
• What is your CAC or customer acquisition cost?
• What is your marketing budget?

What marketing channels do car dealerships use?

A few marketing channels that car dealership businesses typically use are:

• Signage, billboards
• PPC ads, Facebook ads, etc.
• Print media
• Loyalty programs
• Online local listing (Google Business)
• Content marketing (share content like vehicle maintenance tips, safe driving tips, etc.) on platforms like blogs, social media, etc.
• Word of mouth, recommendations

You must have a fair and nearly accurate estimate of your marketing budget. Therefore, make sure to budget for marketing accordingly in your financial projections.

What are your Unique Selling Propositions (USPs)?

In other words, how do you differentiate yourself vs. competitors? This is very important as you might need to win customers from competitors.

A few examples of USPs are:

• Products: you may be the exclusive distributor or a car make in your area for example
• Services : you may offer repairs and regular checkups for your customers
• Location : you store is closer to a busy road and/or to where your customers live

Your USPs will depend on your business model, competitor analysis, and target audience. Whatever your USPs are, it should appeal to your potential customers and attract them.

5. Management & People

You must address 2 things here:

• The management team and their experience/track record
• The organizational structure: the different team members and who reports to whom

Small businesses often fail because of managerial weaknesses. Thus, having a strong management team is vital. Highlight the experience and education of senior managers that you intend to hire to oversee your car dealership.

Describe their duties, responsibilities, and roles. Also, highlight their previous experience and explain how they succeeded in their previous roles.

Organization Structure

Even if you haven’t already hired a VP of sales, sales managers, support staff and any other relevant staff members, you must provide a chart of the organizational structure outlining the different teams, roles and their reporting lines.

6. Financial Plan

The financial plan is perhaps, with the executive summary, the most important section of any business plan.

Indeed, a solid financial plan tells lenders that your business is viable and can repay the loan you need from them. If you’re looking to raise equity from private investors, a solid financial plan will prove them your car dealership is an attractive investment.

There should be 3 sections to your financial plan section:

• Your historical financials (only if you already operate the business and have financial accounts to show)
• The startup costs of your project (if you plan to start a new car dealership, or purchase new inventory, expand your store, etc.)
• The 5-year financial projections

a) Historical Financials (if any)

In the scenario where you already have some historical financials (a few quarters or a few years), include them. A summary of your financial statements in the form of charts e.g. revenue, gross profit and net profit is enough, save the rest for the appendix.

If you don’t have any, don’t worry, most new businesses don’t have any historical financials and that’s ok. If so, jump to Startup Costs instead.

b) Startup Costs

Before we expand on 5-year financial projections in the following section, it’s always best practice to start with listing the startup costs of your project. For a car dealership, startup costs are all the expenses you incur before you open your shop and starting making sales. These expenses typically are:

• The lease deposit for the commercial space you rent (if you don’t buy it)
• The design and renovation of the existing facilities
• The inventory costs (the initial stock of vehicles you must buy to sell them at opening)

For example, let’s assume you want to buy 30 light vehicles as a start for inventory, and you take on a loan where you need to put down 15% upfront. Now, assuming these vehicles each cost $50,000 on average, this means you must put down $300,000 yourself. This comes in addition with any other startup cost mentioned above (lease deposit, renovation costs, etc.).

c) 5-Year Financial Projections

In addition to startup costs, you will now need to build a solid 5-year financial model as part of your business plan for your car dealership .

Your financial projections should be built using a spreadsheet (e.g. Excel or Google Sheets) and presented in the form of tables and charts in your business plan.

As usual, keep it concise here and save details (for example detailed financial statements, financial metrics, key assumptions used for the projections) for the appendix instead.

Your financial projections should answer at least the following questions:

• How much revenue do you expect to generate over the next 5 years?
• When do you expect to break even?
• How much cash will you burn until you get there?
• What’s the impact of a change in pricing (say 20%) on your margins?
• What is your average customer acquisition cost?

You should include here your 3 financial statements (income statement, balance sheet and cash flow statement). This means you must forecast:

• The number of vehicles you sell over time ;
• Your expected revenue ;
• Operating costs to run the business ;
• Any other cash flow items (e.g. capex, debt repayment, etc.).

When projecting your revenue, make sure to sensitize pricing and the number of customers as a small change in these assumptions will have a big impact on your revenues.

7. Funding Ask

This is the last section of the business plan of your car dealership. Now that we have explained what type of vehicles your company sells to whom and at what price, but also what’s your marketing strategy, where you go and how you get there, this section must answer the following questions:

• How much funding do you need?
• What financial instrument(s) do you need: is this equity or debt, or even a free-money public grant?
• How long will this funding last?
• Where else does the money come from? If you apply for a SBA loan for example, where does the other part of the investment come from (your own capital, private investors?)

If you raise debt:

• What percentage of the total funding the loan represents?
• What is the corresponding Debt Service Coverage Ratio ?

If you raise equity

• What percentage ownership are you selling as part of this funding round?
• What is the corresponding valuation of your business?

Use of Funds

Any business plan should include a clear use of funds section. This is where you explain how the money will be spent.

Will you spend most of the loan / investment to acquire the cost for the inventory (the vehicles)? Or will it cover mostly the cost of buying the land and building the store?

Those are very important questions you should be able to answer in the blink of an eye. Don’t worry, this should come straight from your financial projections. If you’ve built solid projections like in our car dealership financial model template , you won’t have any issues answering these questions.

For the use of funds, we recommend using a pie chart like the one we have in our financial model template where we outline the main expenses categories as shown below.

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Business Plan Template for Car Dealerships

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Thinking of starting or expanding your car dealership business? You're going to need a solid plan to drive your success. Luckily, ClickUp has the perfect solution for you - our Business Plan Template for Car Dealerships!

With this template, you can:

• Craft a comprehensive business strategy that covers all aspects of your dealership, from marketing to operations.
• Create accurate financial projections to impress investors and secure the funding you need to grow.
• Conduct in-depth market analysis to identify your target audience and stay ahead of the competition.
• Develop operational plans to streamline your processes and maximize efficiency.

Don't let your dreams of running a successful car dealership stay parked. Get started with ClickUp's Business Plan Template for Car Dealerships today and accelerate your path to success!

Business Plan Template for Car Dealerships Benefits

When using the Business Plan Template for Car Dealerships, you can expect the following benefits:

• Streamline the process of creating a comprehensive business plan for your car dealership
• Clearly outline your mission, vision, and goals to attract investors and secure funding
• Conduct a thorough analysis of your target market and competition to identify opportunities for growth
• Develop detailed financial projections and budgets to ensure the financial viability of your dealership
• Create a roadmap for the operational aspects of your business, including sales strategies, inventory management, and customer service protocols
• Stay organized and focused on your dealership's growth and success with a structured and professional business plan.

Main Elements of Car Dealerships Business Plan Template

ClickUp's Business Plan Template for Car Dealerships provides a comprehensive framework to help car dealership owners and entrepreneurs create a winning business plan. Here are the main elements of this template:

• Custom Statuses: Track the progress of different sections of your business plan with statuses like Complete, In Progress, Needs Revision, and To Do.
• Custom Fields: Add important details to your plan using custom fields like Reference, Approved, and Section, allowing you to organize and categorize your information.
• Custom Views: Access different perspectives of your business plan, including Topics, Status, Timeline, Business Plan, and Getting Started Guide, to ensure that every aspect of your dealership's strategy is thoroughly covered.
• Financial Projections: Utilize ClickUp's built-in reporting and analytics features to create and analyze financial projections, providing a clear picture of your dealership's financial performance and potential.
• Collaboration Tools: Collaborate with your team, assign tasks, and set due dates to ensure everyone is working together towards your dealership's success.
• Integration: Seamlessly integrate with other tools and software, such as accounting software, CRM systems, and marketing platforms, to streamline your dealership's operations and improve efficiency.

With ClickUp's Business Plan Template for Car Dealerships, you'll have all the tools you need to create a comprehensive and effective business plan that will set your dealership up for success.

How To Use Business Plan Template for Car Dealerships

If you're a car dealership owner looking to create a comprehensive business plan, the Business Plan Template in ClickUp can help you get started. Follow these steps to ensure you cover all the essential elements for a successful car dealership business plan:

1. Analyze the market and competition

Begin by conducting thorough market research to understand the current trends and customer preferences in the automotive industry. Identify the target market segment for your dealership and analyze your competitors to determine your unique selling proposition (USP).

Use the Goals feature in ClickUp to set objectives for market research and competitor analysis.

2. Define your business goals and objectives

Clearly define your short-term and long-term business goals. These may include sales targets, customer satisfaction goals, expansion plans, or specific objectives related to inventory management or customer retention. Establishing clear goals will help guide your decision-making and keep your dealership on track.

Utilize the Board view in ClickUp to visualize and track your business goals and objectives.

3. Develop a marketing and sales strategy

Create a comprehensive marketing and sales strategy that outlines how you will attract customers, promote your dealership, and increase sales. This may include digital marketing tactics, traditional advertising methods, partnerships with local businesses, or special promotions and events.

Use the Automations feature in ClickUp to set up automated marketing campaigns and track their performance.

4. Create a financial plan

Develop a detailed financial plan that includes projected revenue, expenses, and profitability. This should encompass various aspects such as inventory costs, employee salaries, marketing expenses, and overhead costs. Additionally, consider incorporating financial projections for the next 3-5 years to demonstrate the long-term sustainability of your dealership.

Use the Table view in ClickUp to organize and analyze financial data, including revenue projections, expense tracking, and profitability calculations.

By following these steps and utilizing the Business Plan Template in ClickUp, you can create a comprehensive and well-structured business plan for your car dealership. Remember to regularly review and update your plan to adapt to changes in the market and ensure the continued success of your dealership.

Get Started with ClickUp’s Business Plan Template for Car Dealerships

Car dealership owners and entrepreneurs can use the Business Plan Template for Car Dealerships to create a comprehensive plan that outlines their strategies and financial projections.

To get started, hit “Add Template” to sign up for ClickUp and add the template to your Workspace. Make sure you designate which Space or location in your Workspace you’d like this template applied.

Next, invite relevant members or guests to your Workspace to start collaborating.

Now you can take advantage of the full potential of this template to create a successful business plan:

• Use the Topics View to organize your plan into different sections such as Executive Summary, Market Analysis, Financial Projections, and more
• The Status View will help you track the progress of each section, with statuses like Complete, In Progress, Needs Revision, and To Do
• The Timeline View will allow you to set deadlines and milestones for each section of your business plan
• Use the Business Plan View to get a bird's-eye view of your entire plan and easily navigate between sections
• The Getting Started Guide View will provide you with step-by-step instructions on how to use the template and create a compelling business plan
• Customize the template by adding custom fields like Reference, Approved, and Section to provide additional information and track important details
• Update statuses and custom fields as you work on your plan to keep team members informed of progress
• Monitor and analyze your business plan to ensure it aligns with your goals and objectives
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Here is a free business plan sample for a car dealership business.

Have you been toying with the idea of opening a car dealership but feel overwhelmed by the thought of planning it out?

Look no further, as we're about to guide you through a comprehensive business plan tailored for the automotive sales industry.

As any seasoned entrepreneur will tell you, a robust business plan is crucial to navigating the road to success. It serves as a roadmap, helping you to establish clear objectives, strategies, and financial projections for your venture.

To shift your planning into high gear without any detours, you can utilize our car dealership business plan template. And if you need an expert pit stop, our team is on standby to review and fine-tune your plan at no cost.

How to draft a great business plan for your car dealership business?

A good business plan for a car dealership must be tailored to the unique aspects of automotive sales and service.

To start, a comprehensive market overview is crucial. This should include current industry statistics and emerging trends, as illustrated in our car dealership business plan template .

Your business plan should articulate your vision clearly. Define your target market (such as families, luxury buyers, or commercial enterprises) and your dealership's unique value proposition (such as specializing in electric vehicles, offering exceptional after-sales service, or providing a wide range of financing options).

Market analysis is a key component. This requires a thorough understanding of local competitors, automotive industry trends, and consumer buying habits.

For a car dealership, it's important to detail the range of vehicles and services you plan to offer. Describe your inventory - new cars, used cars, commercial vehicles - and how these cater to the preferences and needs of your target customers.

The operational plan is critical. It should outline the location of your dealership, the showroom layout, vehicle procurement strategies, and the sales process.

As a car dealership, you must emphasize the quality of your vehicles, customer service excellence, and adherence to automotive industry standards and regulations.

Address your marketing and sales strategy next. How will you draw in and keep customers? Consider advertising tactics, customer loyalty programs, and cross-selling opportunities (such as selling car accessories or offering maintenance packages).

Implementing digital strategies, like maintaining an updated website and active social media profiles, is also vital in the modern marketplace.

The financial plan is another crucial element. This includes the initial investment, sales projections, operational expenses, and the point at which you will break even.

In a car dealership, understanding the profit margins for different types of vehicles and services is essential, so meticulous planning and a firm grasp of your financials are necessary. For assistance, refer to our financial forecast for a car dealership .

Compared to other business plans, a car dealership's plan must pay special attention to inventory management, manufacturer relationships, compliance with automotive regulations, and the cyclical nature of car sales.

A well-crafted business plan will not only help you clarify your strategies and vision but also attract investors or secure loans.

Lenders and investors are looking for a solid market analysis, realistic financial projections, and a clear understanding of the day-to-day operations of a car dealership.

By presenting a detailed and substantiated plan, you show your credibility and dedication to the success of your dealership.

To achieve these goals while saving time, you can complete our car dealership business plan template .

A free example of business plan for a car dealership business

Here, we will provide a concise and illustrative example of a business plan for a specific project.

This example aims to provide an overview of the essential components of a business plan. It is important to note that this version is only a summary. As it stands, this business plan is not sufficiently developed to support a profitability strategy or convince a bank to provide financing.

To be effective, the business plan should be significantly more detailed, including up-to-date market data, more persuasive arguments, a thorough market study, a three-year action plan, as well as detailed financial tables such as a projected income statement, projected balance sheet, cash flow budget, and break-even analysis.

All these elements have been thoroughly included by our experts in the business plan template they have designed for a car dealership .

Here, we will follow the same structure as in our business plan template.

Market Opportunity

Market data and figures.

The automotive retail industry is a significant component of the global economy.

As of recent data, the global automotive dealership market is valued at several hundred billion dollars, with projections indicating steady growth. This is fueled by increasing vehicle sales, both new and pre-owned, and the expansion of automotive services.

In the United States alone, there are over 18,000 franchised car dealerships, generating a combined annual revenue of over 1 trillion dollars. This underscores the critical role car dealerships play in the American economy and the automotive industry at large.

These figures highlight the robust nature of the car dealership market and its substantial contribution to economic activity.

The automotive industry is witnessing several key trends that are shaping the future of car dealerships.

Electric vehicles (EVs) are gaining momentum, with more consumers seeking environmentally friendly transportation options. This shift is driving dealerships to diversify their inventory to include a range of EVs and hybrids.

Connectivity and autonomous driving technologies are advancing, leading to an increased demand for vehicles equipped with the latest tech features.

Online car buying platforms are transforming the traditional car purchasing experience, offering more convenience and transparency to consumers. This trend is compelling dealerships to enhance their digital presence and offer virtual showrooms and online financing options.

Subscription services and flexible ownership models are also emerging, providing alternatives to traditional car ownership and leasing.

Amidst these trends, consumer expectations for exceptional service and personalized experiences remain high, pushing dealerships to prioritize customer satisfaction and loyalty programs.

These trends are indicative of the dynamic nature of the car dealership industry and the need for businesses to adapt to the evolving preferences of modern consumers.

Success Factors

Several factors contribute to the success of a car dealership.

First and foremost, a diverse and high-quality vehicle inventory that meets consumer demands is essential. Dealerships that offer a wide range of models, including the latest releases and certified pre-owned vehicles, are more likely to attract a broad customer base.

Innovative marketing strategies and a strong online presence are also critical in a digital age where many consumers begin their car buying journey online.

The location of the dealership plays a significant role in its visibility and accessibility to potential customers.

Exceptional customer service, from the initial inquiry to post-sale support, is vital for building trust and encouraging repeat business.

Lastly, efficient operations management, competitive pricing, and the ability to adapt to industry trends, such as the rise of electric vehicles and digital sales platforms, are key to a dealership's long-term viability and profitability.

The Project

Project presentation.

Our car dealership project is designed to cater to the evolving needs of modern consumers who are seeking reliable, eco-friendly, and technologically advanced vehicles. Strategically located in an area with high vehicular traffic and easy accessibility, our dealership will offer a diverse range of vehicles, including electric and hybrid models, family cars, and luxury vehicles, all from reputable manufacturers.

We will prioritize exceptional customer service, a transparent buying process, and a comprehensive after-sales support system to ensure a seamless and satisfying ownership experience.

Our dealership is set to become a trusted destination for car buyers who value sustainability, innovation, and quality in their automotive choices, thereby contributing to a greener and more technologically connected community.

Value Proposition

The value proposition of our car dealership is centered on providing a diverse selection of high-quality vehicles that cater to the environmental consciousness and lifestyle needs of our customers.

Our commitment to sustainability, customer satisfaction, and technological innovation positions us as a forward-thinking dealership that not only sells cars but also contributes to a cleaner environment and enhances the driving experience with the latest automotive advancements.

We are dedicated to fostering long-term relationships with our customers by offering a trustworthy, informative, and hassle-free car buying journey, and aim to educate our customers about the benefits of eco-friendly and smart vehicle choices.

Our dealership is determined to be a cornerstone in the community, offering a sustainable and advanced automotive solution that aligns with the values and aspirations of our customers.

Project Owner

The project owner is an automotive industry professional with a passion for cars and a deep understanding of the modern consumer's expectations.

With a background in automotive sales and a keen interest in environmental sustainability, he is driven to establish a car dealership that stands out for its commitment to offering eco-friendly and technologically advanced vehicles.

With a vision of innovation and customer-centric service, he is dedicated to providing a selection of cars that not only meet the practical demands of daily life but also contribute to the reduction of carbon footprints and the promotion of green technology.

His dedication to excellence and his enthusiasm for the automotive industry make him the driving force behind this project, aiming to revolutionize the car buying experience and support the community's transition to more sustainable transportation options.

The Market Study

Market segments.

The market segments for this car dealership are divided into several categories.

First, there are individuals looking for reliable and affordable transportation, who prioritize functionality and value in their vehicle purchases.

Next, there are car enthusiasts and luxury buyers who seek the latest models, high performance, or premium features in their vehicles.

The market also includes families in need of spacious and safe vehicles for daily commuting and long-distance travel.

Finally, businesses and professionals requiring fleet vehicles or company cars form another significant segment, emphasizing durability and cost-effectiveness.

SWOT Analysis

A SWOT analysis of this car dealership project reveals several aspects.

Strengths include a wide selection of vehicles, strong relationships with manufacturers, a knowledgeable sales team, and a reputation for excellent customer service.

Weaknesses could include the high costs associated with maintaining an extensive inventory and the challenge of adapting to rapidly changing automotive technology.

Opportunities lie in the growing demand for electric and hybrid vehicles, the potential to offer competitive financing options, and the ability to expand services such as maintenance and repairs.

Finally, threats could include economic downturns affecting consumer spending, increased competition from other dealerships and online car sellers, and regulatory changes impacting the automotive industry.

Competitor Analysis

Competitor analysis in the car dealership sector reveals a diverse and competitive landscape.

Among direct competitors are other local dealerships, national chains, and online platforms that offer vehicle sales and leasing options.

These players compete on price, vehicle selection, financing options, and customer service quality.

Potential competitive advantages include exclusive dealership agreements with manufacturers, a strong online presence, exceptional after-sales support, and a loyal customer base.

Understanding competitors' strengths and weaknesses is crucial for carving out a unique position in the market and ensuring customer loyalty.

Competitive Advantages

Our car dealership stands out due to our commitment to providing a diverse range of high-quality vehicles that cater to various customer needs and preferences.

We offer competitive pricing, flexible financing options, and a customer-centric approach that ensures a seamless buying experience.

Additionally, our after-sales services, including maintenance, repairs, and parts, help us maintain strong relationships with our customers, fostering trust and repeat business.

We pride ourselves on our knowledgeable staff who are passionate about cars and dedicated to helping customers find the perfect vehicle for their lifestyle and budget.

You can also read our articles about: - how to start a car dealership business: a complete guide - the customer segments of a car dealership business - the competition study for a car dealership business

The Strategy

Development plan.

Our three-year development plan for the car dealership is designed to establish us as a leader in the automotive sales industry.

In the first year, we will concentrate on building a robust inventory of quality vehicles and creating a strong local presence through exceptional customer service and community engagement.

The second year will focus on expanding our reach by establishing additional showrooms in key locations and enhancing our online sales platform to cater to a wider audience.

By the third year, we aim to diversify our offerings to include electric and hybrid vehicles, as well as providing financial services such as leasing and car loans. We will also seek strategic partnerships with automotive service providers to offer a comprehensive customer experience.

Throughout this period, we will remain dedicated to customer satisfaction, transparency in transactions, and staying ahead of industry trends to serve our clients better and secure our market position.

Business Model Canvas

The Business Model Canvas for our car dealership focuses on a diverse customer segment that includes first-time buyers, families, professionals, and car enthusiasts.

Our value proposition is centered around providing a wide range of high-quality vehicles, competitive pricing, and a superior customer buying experience.

We will facilitate sales through our physical dealership locations and a user-friendly online platform, utilizing key resources such as our knowledgeable sales team and our partnerships with reputable car manufacturers.

Key activities include vehicle procurement, sales consultations, and after-sales support.

Our revenue streams will be generated from vehicle sales, financing options, and after-sales services, while our costs will be primarily associated with inventory acquisition, facility maintenance, and marketing initiatives.

Access a complete and editable real Business Model Canvas in our business plan template .

Marketing Strategy

Our marketing strategy is built on brand recognition and customer loyalty.

We plan to engage potential customers by showcasing the reliability and variety of our vehicle inventory. We will host test drive events, participate in local and regional auto shows, and maintain an active online presence with virtual tours and detailed vehicle information.

We will also establish partnerships with local businesses and organizations to expand our network and referral base.

Utilizing social media, targeted advertising, and influencer partnerships, we aim to reach a wider audience and establish our dealership as a trusted name in the automotive industry.

Risk Policy

The risk policy for our car dealership is focused on mitigating risks associated with inventory management, market fluctuations, and customer satisfaction.

We will implement a dynamic inventory management system to align with market demand and avoid overstocking. We will also keep abreast of industry trends to adapt to changes in consumer preferences, particularly with the shift towards sustainable vehicles.

To ensure customer satisfaction, we will provide comprehensive training to our staff and implement a feedback system to promptly address any concerns.

Additionally, we will maintain a conservative financial strategy to safeguard against economic downturns and have comprehensive insurance policies to cover potential liabilities.

Why Our Project is Viable

We are committed to launching a car dealership that meets the evolving needs of modern consumers.

With a focus on quality, customer service, and adaptability to market trends, we are poised to carve out a significant share in the competitive automotive market.

We are enthusiastic about the opportunity to serve our community and look forward to the growth and success of our dealership.

Open to strategic adjustments and innovation, we are confident in the viability and future prosperity of our car dealership.

You can also read our articles about: - the Business Model Canvas of a car dealership business - the marketing strategy for a car dealership business

The Financial Plan

Of course, the text presented below is far from sufficient to serve as a solid and credible financial analysis for a bank or potential investor. They expect specific numbers, financial statements, and charts demonstrating the profitability of your project.

All these elements are available in our business plan template for a car dealership and our financial plan for a car dealership .

Initial expenses for our car dealership include acquiring a suitable showroom location, purchasing an initial inventory of vehicles, obtaining the necessary licenses and insurance, investing in high-quality maintenance equipment, and developing a robust IT system for inventory and sales management. Additionally, we will incur costs related to branding, creating an online presence, and launching targeted marketing campaigns to attract potential customers.

Our revenue assumptions are based on a comprehensive analysis of the local market demand for vehicles, taking into account factors such as population growth, economic trends, and consumer preferences for specific car models and features.

We anticipate a steady increase in vehicle sales, starting with a conservative approach and expanding as our dealership gains recognition and trust within the community.

The projected income statement outlines expected revenues from vehicle sales and services, cost of goods sold (purchase price of inventory, parts, and supplies), and operating expenses (facility lease, marketing, salaries, utilities, etc.).

This results in a forecasted net profit that is essential for assessing the long-term profitability of our car dealership.

The projected balance sheet reflects assets specific to our business, such as vehicle inventory, showroom fixtures, and liabilities including loans and anticipated operational expenses.

It provides a snapshot of the overall financial health of our car dealership at the end of each accounting period.

Our projected cash flow statement details the inflows and outflows of cash, enabling us to predict our financial needs at any given time. This will assist us in managing our finances effectively and preventing cash flow issues.

The projected financing plan identifies the specific sources of funding we intend to utilize to cover our startup and operational expenses.

The working capital requirement for our car dealership will be meticulously managed to ensure we have the necessary funds to support daily operations, including vehicle procurement, inventory management, and employee wages.

The break-even point for our dealership is the level of sales required to cover all our costs, including initial investments, and to begin generating a profit.

It will signal the point at which our business becomes financially sustainable.

Performance indicators we will monitor include the gross profit margin on vehicle sales, the inventory turnover rate to evaluate the efficiency of our stock management, and the return on investment to gauge the profitability of the capital invested in our dealership.

These metrics will aid us in assessing the financial performance and overall success of our car dealership.

If you want to know more about the financial analysis of this type of activity, please read our article about the financial plan for a car dealership business .

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Car Dealership Business Plan Template [Updated 2024]

Car Dealership Business Plan

If you want to start a new car dealership or expand your current dealership, you need a business plan.

The following car dealership business plan template gives you the key elements to include in a winning business plan. In addition to this template, a successful business plan will include market research to support your business concept, help you better understand the car dealership industry, market trends, car prices and your target customers. It will also help you craft a smart marketing plan and a strong financial plan.

You can download our Car Dealership Business Plan Template (including a full, customizable financial model) to your computer here.

Sample Business Plan For New Car Dealerships

Below are links to each of the key sections of a sample business plan that can be used for all types of car dealerships including a luxury car dealership, an online car dealership, new car dealers, and used car dealerships.

• Executive Summary – The executive summary provides an overview of your business opportunity and summarizes the business plan.
• Company Overview – The company analysis includes information about your business concept, the types of vehicles you plan to sell, car repair and maintenance services and legal structure.
• Industry Analysis – The industry analysis includes market research that supports your business and provides insights into market trends and the automotive industry.
• Customer Analysis – The customer analysis provides an overview of your target market and the purchasing habits of these potential customers.
• Competitive Analysis – The competitive analysis should identify your direct and indirect competitors and highlight your competitive advantage.
• Marketing Plan – The marketing plan includes your marketing strategy, pricing strategy and how you will build brand awareness utilizing social media platforms and other forms of digital marketing.
• Operations Plan – The Operations Plan includes information on your dealership’s day-to-day operations including inventory management and auto sales, and processes in the service department to maintain customer satisfaction.
• Management Team – The management team section includes a profile of the business owner and business management, their experience and company responsibilities.
• Financial Plan – The financial plan includes financial projections, a cash flow statement, profit and loss statement, and balance sheet.

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Car Dealership Business Plan Home I. Executive Summary II. Company Overview III. Industry Analysis IV. Customer Analysis V. Competitive Analysis VI. Marketing Plan VII. Operations Plan VIII. Management Team IX. Financial Plan

Used Car Dealership Business Plan Template

Written by Dave Lavinsky

Used Car Dealership Business Plan

You’ve come to the right place to create your Used Car Dealership business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Used Car Dealerships.

Below is a template to help you create each section of your Used Car Dealership business plan.

Executive Summary

Business overview.

Reliable Motors is a used car dealership located in Portland, Oregon. We specialize in offering a wide selection of high-quality used vehicles to customers in our local area. With a focus on exceptional customer service and competitive pricing, we aim to become the preferred choice for individuals looking to purchase reliable pre-owned vehicles.

Reliable Motors is run by Otto Masterson. Otto has 12 years of experience in vehicle sales and dealership operations. His customer-centric approach, and strong understanding of the local market will ensure that our firm is successful.

Product Offering

Reliable Motors offers a diverse inventory of used cars, trucks, SUVs, and vans from various makes and models. Our selection includes vehicles that are carefully inspected, tested, and certified to meet our stringent quality standards. We also provide vehicle history reports and offer extended warranties for added peace of mind. Our knowledgeable sales team is committed to assisting customers in finding the right vehicle that suits their needs and budget.

Customer Focus

Our primary target market includes individuals and families in Portland, Oregon who are looking to purchase a reliable used vehicle. We will cater to customers with various budgets, offering a range of price points to accommodate different financial situations. Additionally, we will also establish partnerships with local businesses, such as car rental companies and auto repair shops, to provide them with fleet vehicles and maintenance services.

Management Team

Reliable Motors’ most valuable asset is the expertise and experience of its founder, Otto Masterson. Otto has been in automotive sales for the past 20 years. Throughout his career, he has developed a strong base of repeat customers, many of whom have stated that they will buy their next car from Reliable Motors once the company is established and running. Otto’s customer-centric approach, and strong understanding of the local market will ensure that our firm is successful.

Success Factors

Reliable Motors will achieve success by offering the following competitive advantages:

• Quality Inventory: We will ensure our inventory consists of well-maintained and reliable used vehicles that meet our strict quality standards.
• Competitive Pricing: We will offer competitive prices to attract customers and provide value for their money. Our pricing strategy will consider market trends, vehicle condition, and fair market value.
• Exceptional Customer Service: We will prioritize customer satisfaction by providing a personalized and hassle-free buying experience. Our knowledgeable and friendly sales team will assist customers in finding the right vehicle that meets their needs and budget.
• Transparent Processes: We will establish trust by providing accurate vehicle information, pricing details, and facilitating open communication.
• Strong Industry Partnerships: We will collaborate with reputable suppliers, finance institutions, and service providers to enhance our offerings and provide additional benefits to customers.

Financial Highlights

Reliable Motors is seeking $1,000,000 in funding to establish and grow the business. The funds will be allocated as follows:

• Inventory acquisition: $800,000
• Renovation and setup of the dealership facility: $100,000
• Marketing and advertising expenses: $50,000
• Working capital: $50,000

The projected financials indicate steady revenue growth and profitability within the first three years of operation

Company Overview

Who is reliable motors.

  Reliable Motors is run by Otto Masterson, a 12 year veteran in vehicle sales and dealership operations. After working for several dealerships around town, he surveyed his most loyal customers to see if they would be willing to switch to his new dealership once it is established. Most of his customers responded enthusiastically, which motivated Otto to finally launch his business.

Reliable Motors History

Once he canvassed his loyal customer base and located a potential location, Otto Masterson incorporated Reliable Motors as an S-Corporation in April 2023.

The business is currently being run out of Otto’s home office, but once the purchase of the dealership location is finalized, all operations will be run from there.

Since incorporation, Reliable Motors has achieved the following milestones:

• Found a location and made an offer of purchase
• Developed the company’s name, logo, and website
• Hired an architect to design the lot, the service area, and the office building
• Determined equipment and fixture requirements
• Began recruiting key employees

Reliable Motors Services

Reliable Motors will provide the following services to its customers:

• Vehicle Sales: offer an inventory of used cars, trucks, SUVs, and vans, catering to various customer preferences and budgets.
• Financing Assistance: assistance with financing options through partnerships with local banks and financial institutions.
• Trade-ins: Customers will have the option to trade in their current vehicles, allowing them to apply the value toward their purchase at Reliable Motors.

Industry Analysis

The used car industry is experiencing steady growth, driven by factors such as rising new car prices, improved vehicle reliability, and a growing preference for cost-effective transportation options.

The used car industry is expected to grow over the next several years. According to a recent report by IBISWorld, the used car dealerships industry is expected to grow at a CAGR of 1.2% from now until 2028. This growth is due to increasing environmental consciousness, which has caused many consumers to avoid purchasing new automobiles. This increase in demand and industry growth ensures that Reliable Motors will achieve success.

This industry presents a significant opportunity for Reliable Motors to cater to customers seeking quality used cars at competitive prices.

Customer Analysis

Demographic profile of target market.

Reliable Motors primarily targets individuals in the Portland area who are in the market for a reliable and affordable pre-owned vehicle. By understanding our customers’ needs and providing a personalized buying experience, we aim to build long-lasting customer relationships.

Customer Segmentation

Reliable Motors will primarily target the following customer profiles:

• First-time car buyers
• Professionals
• Individuals

Competitive Analysis

Direct and indirect competitors.

Reliable Motors faces competition from both direct and indirect competitors in the used car dealership industry. Direct competitors include other local dealerships offering similar vehicle options. Indirect competitors include online marketplaces and private sellers.

AutoWheels is a used car dealership that carries a large variety of used cars, trucks, SUVs, and vans. Their line of car brands include Chevrolet, Dodge, Ford, Jeep, and Toyota. AutoWheels’ focus is offering clean, newer model used cars with affordable monthly payments. The dealership offers flexible financing approval for buyers with any credit score or financial situation.

AutoWheels partners with Portland Precision Auto Care for its automotive maintenance and repair needs. This partnership enables AutoWheels to offer services that include Car and Truck care, Electronic Services, Electrical Services, General Services, Heating and Cooling Services, Engine & Transmission, Miscellaneous Services, Transmission Services, Undercar Services, and Brakes.

James Rivers Automotive Outlet

Located in Portland’s Sellwood-Moreland neighborhood, James Rivers Automotive Outlet is a member of the James Rivers Family-Owned and Operated group of dealers in Portland. The dealership carries a large inventory of new, certified pre-owned, and pre-owned line of cars, trucks, SUVs, and vans. Their line of vehicles are in all price ranges and body types. James Rivers Automotive Outlet also offers trade-in evaluations at their other franchised stores – James Rivers Honda, Acura, and Toyota. The dealership also offers affordable financing options.

Eastside Used Cars

Established in 2011, Eastside Used Cars is a family-owned used car dealership. The dealership is fully internet based and all sales are by appointment only, in one of two locations: Sandy and Gresham. The dealership claims to have the best prices in the market, offering wholesale prices to the public. Customers may also expect to receive top dollar for their trade-ins.

The dealership currently offers an inventory of 175 vehicles, ranging in price from $6,990 to $60,800. It offers a variety of finance options for consumers with all levels of credit, but outside financing is welcomed.

Competitive Advantage

Reliable Motors holds the following advantages over the competition:

• Rigorous Vehicle Inspection : Each vehicle in our inventory undergoes a thorough inspection to ensure its mechanical and cosmetic condition, providing customers with peace of mind.
• Customer-Centric Approach : We prioritize customer satisfaction by offering personalized assistance, transparent pricing, and a hassle-free buying experience.
• Extensive Inventory : Our diverse inventory caters to various customer preferences and budgets, ensuring a wide range of options to choose from.

Marketing Plan

Brand & value proposition.

Reliable Motors will offer a unique value proposition to its clientele:

• Client-focused automotive sales, where the customer is treated fairly, with transparent pricing and a variety of financing options
• Service built on long-term relationships
• Top-quality automotive repair and maintenance, at competitive prices

Promotions Strategy

The promotions strategy for Reliable Motors is as follows:

Reliable Motors understands that the best promotion comes from satisfied customers. The Company will encourage its customers to refer other businesses by providing economic or financial incentives for every new customer produced. This strategy will increase in effectiveness after the business has already been established.

Social Media

Reliable Motors will invest heavily in a social media advertising campaign. The company will create social media accounts and invest in ads on all social media platforms. It will use targeted marketing to appeal to the target demographics.

Website/SEO Marketing

Reliable Motors will invest heavily in developing a professional website that showcases current inventory, and provides valuation tools for potential trade-ins. It will also invest heavily in SEO so that the firm’s website will appear at the top of search engine results.

Operations Plan

The following will be the operations plan for Reliable Motors. Operation Functions:

• Otto Masterson is the Owner of Reliable Motors. In addition to providing inventory management and sales, he will also manage the general operations of the business.
• Otto Masterson is joined by a full-time administrative assistant, Mandy Bobo, who will take charge of the administrative tasks for the company. She will also be available to answer incoming calls and make service appointments.
• As the company builds its customer base, Otto will hire more sales professionals to grow our business further.

Milestones:

Reliable Motors will have the following milestones completed in the next six months.

• 6/2023 Finalize location purchase
• 7/2023 Design and build out Reliable Motors
• 8/2023 Hire and train initial staff
• 9/2023 Kickoff of promotional campaign
• 10/2023 Launch Reliable Motors
• 11/2023 Reach break-even

Reliable Motors’s most valuable asset is the expertise and experience of its founder, Otto Masterson. Otto has been in automotive sales for the past 20 years. Throughout his career, he has developed a loyal customer base, many of whom have stated that they will switch to Reliable Motors when it comes time to purchase a new vehicle. Otto’s customer-centric approach, and strong understanding of the local market will ensure that our dealership is successful.

Though he has never run his own business, Otto Masterson worked his way up from automotive sales associate to sales manager, where he gained an in-depth knowledge of the operations (e.g., running day-to-day operations) and the business (e.g., staffing, marketing, etc.) sides of the industry. He also already has a starting customer base that he served while working for other auto dealerships. He will hire several other employees who can help him run the aspects of the business that he is unfamiliar with.

Financial Plan

Key revenue & costs.

Reliable Motors’s revenues will from vehicle sales, with additional income generated through financing options and after-sales services. Key costs include

The notable cost drivers for the company will include inventory acquisition, overhead expenses, marketing expenses, personnel costs, and facility maintenance.

Funding Requirements and Use of Funds

Key assumptions.

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and pay off the startup business loan.

• Number of clients:
• Year 1: 400
• Year 2: 500
• Year 3: 750
• Year 4: 1000
• Year 5: 1250

Financial Projections

Income statement, balance sheet, cash flow statement, used car dealership business plan faqs, what is a used car dealership business plan.

A used car dealership business plan is a plan to start and/or grow your used car dealership business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your Used Car Dealership business plan using our Used Car Dealership Business Plan Template here .

What are the Main Types of Used Car Dealership Businesses? 

There are a number of different kinds of used car dealership businesses , some examples include: Franchised dealership, Independent dealerships, and “Bad Credit” dealerships.

How Do You Get Funding for Your Used Car Dealership Business Plan?

Used Car Dealership businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start a Used Car Dealership Business?

Starting a used car dealership business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Used Car Dealership Business Plan - The first step in starting a business is to create a detailed used car dealership business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast. 

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your used car dealership business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your used car dealership business is in compliance with local laws.

3. Register Your Used Car Dealership Business - Once you have chosen a legal structure, the next step is to register your used car dealership business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.

4. Identify Financing Options - It’s likely that you’ll need some capital to start your used car dealership business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.

7. Acquire Necessary Used Car Dealership Equipment & Supplies - In order to start your used car dealership business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your used car dealership business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful used car dealership business:

• How to Start a Used Car Business

Where Can I Get a Used Car Dealership Business Plan PDF?

You can download our free used car dealership business plan template PDF here . This is a sample used car dealership business plan template you can use in PDF format.

Don't bother with copy and paste.

Get this complete sample business plan as a free text document.

Used Auto Sales Business Plan

Start your own used auto sales business plan

Integrity Auto Sales

Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">, auto sales & parts.

There is a need in Lane County for a large selection of quality used cars, and Integrity Auto Sales will sell these top-quality used vehicles at a competitive price. The owner and sales manager have over 30 years of combined experience in new and used auto sales. We will continue to develop our excellent working relationship with local dealers and auctions to bring the savings to the customer.

We will create a purchasing environment that caters to the customer’s needs. We are selling a professional service and an experience in car buying that will bring customers back again, as well as referring friends and family. We estimate an optimistic gross margin over the industry average. We will be successful because of the excellent team we have assembled and the drive and determination of the owners.

Almost everyone needs a car to get from point A to B. Many families have two or more cars. Due to the recent success of the new car market, there is a large inventory of used cars available for re-sale. New car sales have enjoyed the largest single month gain in October up 24%.

Competition

Used car dealers are notorious for unethical sales practices. Customers are inherently cautious and untrusting as a result. The more we can provide a high-quality sales experience, the more successful we will be. Our salesmen will provide a friendly and personal experience for the buyer. We will follow up and ensure customer satisfaction. We will rely on these customers for an excellent reference to other car buyers. This company will build an excellent working relationship with our suppliers and customers.

Integrity Auto Sales provides a unique car buying experience to the customers in the Willamette Valley. One that focuses on customer satisfaction first. We understand that vehicle purchasing is a necessary, but sometimes unpleasant experience. Our goal is to provide the customer with an enjoyable, honest service by satisfying individual customers practical transportation needs with a quality product.

We also believe it is important to have quality vehicles at a low cost, and will back each vehicle with a 30 day limited warranty. Our company will make a profit by generating sales. It will provide job satisfaction and fair compensation to its employees, and a fair return to its owners. Hard work and performance is rewarded through bonuses and commissions. Job satisfaction is very important for employees and owners, we will create a work environment that is enjoyable and profitable for all.

Expectations

• Growth will be moderate to good, cash flows steady with several months of loss in the beginning
• Marketing will remain below 10% of sales. 
• The company will invest residual profits (10%) into financial markets and approximately 50% into company expansion for the first year.

Financial Highlights by Year

Financing needed.

We need $130,000 funding to start. That includes a $100,000 loan. Jonathan will invest $20,000 and Don will invest $10,000. 

Opportunity

Problem & solution, problem worth solving, our solution, target market, market size & segments.

Almost everyone needs a car to get from point A to B. Many families have two or more cars. Due to the recent success of the new car market, there is a large inventory of used cars available for re-sale. New car sales have enjoyed the largest single month gain in October 2001, up 24%.

4.1 Market Segmentation

Our market segmentation will consist of four basic segments; students, retired, families, and singles.

Current Alternatives

Our closest, similar competitors are AA Auto Sales, Big Apple Car Sales, Frank’s Auto Place, Guaranty, R & L Motors, and Sierra Truck, all on Hwy 99 between Eugene and Junction City.

• The primary competitors will be those in and around Junction City. Guaranty is a large, well-established dealer, with approximately 75% of the local market share. Guaranty has a large operation with a well-trained sales staff. Our sales manager is a former Guaranty sales manager, who understands the competition’s operations very well.
• Frank’s Auto Place offers a limited selection, and appears to be unorganized. Frank’s does not offer any competitive marketing and primarily focuses on the $1-2,000 vehicle.

Our Advantages

Keys to success.

To succeed in this business we must:

• Put together a team of experienced professionals.
• Secure an excellent high-traffic location.
• Establish a network of suppliers, in order to buy and sell products that are of the highest reliability and quality, at a competitive price.
• Ensure customer satisfaction by encouraging the two most important values, honor and integrity.
• Create high morale by rewarding employee success with monetary compensation.

Marketing & Sales

Marketing plan.

Our marketing strategy will focus on four segments. Those segments are described in the following subtopics. We will implement a strategy that treats customers as a community. This means our marketing resources will be centered around advertising both sales promotions (events) and personal sales (customer service, friendly atmosphere).

• The marketing budget will not exceed $6,000 per year.
• 100% customer satisfaction, measured through repeat customers, referrals and surveys.
• To achieve a respectable profit margin within the first three-years.
• To achieve a healthy net profit by year two.

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The  retired  group will focus on practicality. Cost may be less important than quality and features. This group wants comfortable, nicely equipped vehicles at a reasonable price. They will want a vehicle that will last for years.

Families  will focus on safe, practical vehicles. Something that will last for years, can fetch groceries, carry the kids, and perform long trips. Many will be on a budget, and price may be a big factor. They will shop around and educate themselves on vehicles, shopping for a specific make or model.

The last group is the  singles . They are similar to the students in that they want flashly cool cars, but may be a working professional who can afford to pay more for a higher-quality vehicle.

Sales compensation is based on a percent of profits. We will invest adequate time and resources into training each member of the sales team and into good customer relations. Salesmen will be paid a portion of their salary based on commission. Good performance is rewarded with increased commission and bonuses. However integrity will not be sacrificed for sales. Customer satisfaction will continue to be a top priority. All potential sales will be attended to in a timely fashion and long-term salesperson-customer relationships will take precedence over sales closure.

Locations & Facilities

• The company office is located at 12345 HWY 99, Junction City, OR 97666.
• The office is approximately 1,000 square feet and has ample space for the first three years of growth.
• The 20,000 square foot lot and building is leased from the principal owner.

Integrity Auto Sales sells top-quality used vehicles at a competitive price. Integrity buys pre-inspected vehicles wholesale from well known local car dealers, and auto auctions. Integrity continually maintains a diverse stock of vehicles, providing the widest selection for individual needs.

Vehicles are purchased weekly, to add to the current stock on hand. Each vehicle is thoroughly inspected by an ASE mechanic with over 25 years of experience. Only vehicles that pass this critical 26 point inspection are sold on-site.

Integrity Auto Sales sells all types of used vehicles, from sports cars to RVs. We cater to each customer individually, to satisfy their own practical needs.  We buy only the best used vehicles at or below wholesale in order to bring the savings to the customers. Each vehicle is thoroughly inspected by an ASE mechanic with over 25 years of experience. We also offer an auto finding service to customers. If we do not have the vehicle they want in stock, we will find one for them.

Milestones & Metrics

Milestones table, key metrics.

Our key metrics are: 

• # of facebook posts and pageviews 
• # of tweets and retweets
• # of reps that meet and excel their quotas. 
• cogs of our most popular cars
• website page views and shares 
• Follow our customers figure out their favorite cars and features 

Ownership & Structure

Integrity Auto Sales is a privately held corporation. It will be registered as a Subchapter S, with ownership 60%-Jonathan Dinsmore, 40%-Don Mazzioti.

Management Team

Integrity will start with four initial employees. The owner will manage over all operations and the sales manager will manage all buying and selling of inventory. A records clerk and lot attendant will also be hired initially.

Once the gross margin and cash flow will support it, we will hire an additional salesman and lot attendants (tentatively four to six months).

Personnel Table

Financial plan investor-ready personnel plan .">, key assumptions.

We will accept credit cards and trade-ins of any value. Credit cards will have a negative affect on cash flow in that we may not be paid for several days. Trade-ins will also impact cash flow in that they are an asset and have no real value until sold. We will have to limit the number of credit transactions, and only take in quality trades at a wholesale price to facilitate turning a quick profit. The personnel burden is very low because benefits are not paid to part-timers. And the short-term interest rate is extraordinarily low because of current market rates.

We also assume conservative earnings from selling loans and extended warranties will be made.

The other assumption is that current market conditions will remain for the next two to three years. Low rates will have a positive impact on sales and lending for the short term.

Our cash forecast is extremely unrealistic at the far end of the forecast. We leave it like that knowing that we will revise over time. We call it a cushion, and reassurance, not an accurate forecast. 

Revenue by Month

Expenses by month, net profit (or loss) by year, use of funds.

Almost 90% of start-up costs will go to assets. Start-up costs will be financed through a combination of owner’s investment, short-term loans (VA business loan), and long-term borrowing. The start-up chart shows the distribution of financing.

Other miscellaneous expenses include:

• Legal fees for business establishment (ownership, and no sell agreement).
• Stationary, office supplies.
• Marketing/advertising fees.
• Initial consultation to establish records with an accountant.
• Rent for lot and office.
• Establish a Web page for advertising.
• Expensed equipment (two computers, two desk, Fax/copier, phone lines, and office furniture).
• One month initial start-up investment in vehicles.

Sources of Funds

We will be needing $130,000 to start. $100,000 will be a long term business loan. Jonathan will give $20,000 and Don will give $10,000. 

Projected Profit & Loss

Projected balance sheet, projected cash flow statement.

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I’m a Car Salesperson: Here Are 6 Ways To Save Money at the Dealership

A fter a couple years of car dealers being able to successfully sell vehicles on their lots well above sticker price because of low inventory and lack of competition, the tide has turned. As of March 2023, inventory is back up and dealer incentive and savings programs have returned too. That means there are opportunities to get a good deal on a vehicle.

Be Aware: 10 New Cars To Avoid Buying in 2024

Try This: How To Get $340 Per Year in Cash Back on Gas and Other Things You Already Buy

To get some insider tips, GOBankingRates turned to the advice of a 24-year veteran in the car sales industry, Mike Davenport, owner of Mike’s Car Store . Davenport has been on social media since 2010, teaching people how to negotiate car deals and wade through red tape.

Before you start car shopping, check out these six ways to save money at the dealership , courtesy of Davenport.

Sponsored: Owe the IRS $10K or more? Schedule a FREE consultation to see if you qualify for tax relief.

Plan To Buy Local

Davenport said that you should start by finding a vehicle at a local dealership that you’re interested in buying. Next, look at other dealerships up to 100 or so miles from your area and find three to five more vehicles of the same make and model with the same equipment.

He said to save the data you gather on each of those vehicles, so you can use it as a negotiating tool at your local dealership. 

Get the Salesperson Interested in Landing Your Business

Next, according to Davenport, you should have a conversation with a salesperson or the sales manager at the local dealership that has the vehicle you want. He said you should say to the salesperson, “I want to keep my business local — do you want me to keep my business local?” Davenport said the reason for this question is to get a “yes.” 

“They’re always going to say yes,” he said. “That’s when you say ‘awesome,’ and you reiterate that you’re going to do all of your vehicle service needs […] at the dealership.”

Read Next: 4 Sneaky Car Dealership Scams That Will Be Illegal in 2024

Davenport said that’s also the time to bring up the other dealers you researched that have comparable vehicles. He said to say, “Listen, I did look at a couple [of] other vehicles, and I like them just as much as I like yours, but you’re local to me. Do you want me to keep my business local?”

He said that he knows you will be repeating yourself, but it’s very good to get the salesperson or sales manager saying ‘yes’ over and over and over again. He said that dealerships are unwilling to lose potential buyers because they know you’ll probably never come back once you walk away. 

Never Tell a Dealership You’re Paying Cash

Davenport said you should never tell the salesperson that you’re paying cash for the vehicle you want to buy because it will lessen your chances of getting the best deal possible. Dealers might reduce the purchase price of the car if they think they can make up the difference in financing. But if you say you are paying cash — or even going through your bank for financing — that option is unavailable to them.

If you have been pre-approved for financing through your bank, and you want to disclose that fact, you can tell the salesperson that you might be interested in financing through the dealer, Davenport said. That will leave the dealer with the hope that it can make some money through financing, and it might be willing to discount the purchase price of the car to get your business. 

Trade In Your Vehicle

Davenport recommends getting trade-in offers from several different dealerships, which can help you negotiate the best price for your trade-in vehicle. However, he cautioned that you should avoid trading in your car at dealers that have no interest in the make and model. For example, he said,  if you have a Toyota Corolla, don’t expect to get the best value for your trade-in at a Lexus dealership because it will likely give you the lowest amount possible and resell it at an auction to recoup what it paid for it. 

 He also said to consider listing your vehicle on Facebook Marketplace for the highest trade-in value or the lowest private party offer and see if any dealerships contact you to earn your business.

Negotiate Each Part of the Deal Separately

Davenport said to get the best deal, you have to negotiate each thing separately.”You do not interlace them,” he said. “You stay focused like a laser beam […], and when you’re happy with the price of the car, you move on to the trade. When you’re happy with the trade, you move on to financing — and after that is when you know you’ve got a great deal.”

Hire a Car-Buying Advocate

If you don’t feel you’re up to the task of negotiating each part of the deal separately, Davenport said a car-buying advocate will do all the legwork for you, including locating the car you want and negotiating the best deal. The only thing you’ll have to do, he said, is sign the papers. 

You will have to pay a fee to a car-buying advocate. One service, Car Buyer’s Advocate, charges $500 plus $100 for each trade to negotiate the best deal. However, some services charge between $1,000-$2,000 or $100-$200 per hour.

Car Buyer’s Advocate states that people can lose $2,000-$10,000 when buying a car on their own, so a fee of $500 (or even a little more) might be well worth it. The company states that the average savings on a new car when using its service is 18% under MSRP. And the average savings on a used car is 25% under retail.

If you decide to hire a service to help you negotiate the best deal on a vehicle, make sure it’s a car-buying advocate. Car-buying advocates charge a fee and offer services that work in your best interest. Car-buying services, however, are typically in cahoots with car dealerships and receive payments for generating leads. These services are not interested in helping you negotiate the best deal possible.  

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This article originally appeared on GOBankingRates.com : I’m a Car Salesperson: Here Are 6 Ways To Save Money at the Dealership

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