How To Make Money Buying And Selling Used Cars Part 4

In the first section of this short series on how to make money buying and selling used cars, we looked at what personal traits someone wishing to be successful in this business would have to have. In the second part we looked at the best sites to locate such a business; in the third we looked at sourcing our supply – our vehicles and in this section, we will look at valuing that stock.

Whether you obtain your cars or trucks from auctions or from private individuals, you will have to be able to work out their worth correctly, so, how do you work out the worth of used cars or trucks? The easiest way to know a vehicle’s average market, trade-in or wholesale worth is to subscribe to a car dealers’ used car guide. Most western countries have one, but in the USA the most popular one is called the National Automobile Dealers’ Used Car Guide or N.A.D.A.

NADA not only issues monthly guides to used cars, it also publishes monthly guides on older or classic cars, smaller boats, larger boats, SUV’s, mobile homes, RV’s, snow mobiles and motorcycles. Look them up on the Internet and join their subscription list for the kinds of vehicles that you are interested in.

These used vehicle guides normally include foreign or imported cars nd trucks as well and are a consensus of sales and auctions over the entire country, therefore a little local intelligence is essential as well as your region may function at slightly above or slightly below the national average, which could present you with additional opportunities for (wholesale) sales by transporting cars into or out of your district.

Sometimes or in some areas, a permit is necessary to run a used car business. This is nothing more than tax by another name usually, so simply requires you to pay a fee. In other regions, it may be a way of weeding out dishonest traders and may require an test of same kind, so it is worth checking your district’s requirements before you start trading.

Some regions have laxer laws than others on buying and selling second-hand cars, allowing ‘occasional sales’. ‘Occasional sales of motor vehicles’ is usually intended to be no more than five sales in a twelve month period.

When you are starting out you can make use of this allowance, if your region allows it, to keep your operating costs down to a minimum in the costly early days of setting up your business, but once you see yourself exceeding this maximum quantity you should submit an application for a license straight away to avoid incurring any penalties. These penalties can be harsh ranging from a fine to disbarment from trading, so be very careful.

You will also have to learn how to collect taxes from your sales and your wages to yourself and to your employees. You will also need to learn how to hand these monies over to the right authorities on time, although your accountant or book-keeper can help you there.

Owen Jones, the writer of this article writes on different topics, but is now involved with entry door locks. If you would like to know more, please go to our website at Escort 8500.