Many individuals in the Chicago area (and elsewhere) supplement their income (or jumpstart a new career) by purchasing automobiles at auctions and reselling them for a profit. If you have ever wondered how to get started or how exactly that process works then read on for more helpful information!
Before discussing the ins and outs of Chicago car auctions and how to become a successful Chicago car dealer lets consider some facts about the automobile industry as a whole. Car dealers are the link between automobile manufacturers and the U.S. consumer. The industry is sharply divided between two segmentsnew car dealers (sometimes called franchised dealers) and independent dealers (also known as used car dealers). New car dealers (usually franchised) primarily sell and lease new cars, sport utility vehicles (SUVs), and passenger and cargo vans dealers sell manufactured by a particular companywhich may include several brands. Conversely, used car dealers sell a variety of vehicles that have been previously owned or formerly rented and leased.
There are many benefits to a career as a car dealer. According to the U.S. Bureau of Labor Statistics average weekly earnings are substantially higher than in other retail industries. Moreover, the National Automobile Dealers Association (founded in 1917) reported in their NADA 2007 Industry Analysis that the average dealership employed 54 persons and had an annual payroll of $2,594,000. This represents almost 14 percent of the nation's total retail trade payroll at a total of $53.9 billion for all dealerships. And if that isn't enough, total dealership employment been consistent and is now at 1,114,500. In 2008, car dealers provided about 1.2 million wage and salary jobs, the majority of which were in new car dealerships.
However due to consolidation within the industry at large (brought about by many factors, chiefly the demands of automobile manufacturers) most of the growth in the automobile industry will be in the independent dealer sector. For individuals in the Chicago area interested in becoming an independent car dealer this spells opportunity!
Recent research shows that independent car dealers comprise the largest retail industry in the United States of America, outnumbering new car dealers at a ratio of three to one. There are many step-by-step guides you may follow that will walk you through the minutiae of starting a used car dealership from scratch. Keep in mind that you want to follow all federal and Illinois laws regulating your new business. You will be subject to Illinois consumer protection laws, Federal Trade Commission oversight, and any additional applicable State of Illinois or federal laws and regulations. One example is the FTCs Used Car Rulea measure implemented to protect consumers which covers all used car dealers in the nation. The Rule requires all used car dealers post a one page Buyers Guide in every car that ensures consumers get written information about any warranty protection available if there is a problem with the car after purchase. Most requirements for new and used motor vehicle dealers are similar. But one difference is that used motor vehicle dealers are required to issue extra paperwork in various situations, such as disclosing the rebuilt status of a vehicle. The statutes specifically covering used vehicle dealers are located under Sec. 5-102 of the state code
Once you are aware and in compliance with all applicable laws how do you get up and running? First, you will need a physical location from which to operate your fledgling car dealership and you must make sure the location is zoned for a car dealership if necessary. Obtain additional information from your local county or city government offices. Auto dealers are required to carry a valid car dealer license at all times. Car sales conducted by non-licensed dealers are considered unlawful and are subject to turnover in a court of law. You will also need to get familiar with the local car auctions, some of which will not be open to the general public. As a dealer you will be able to attend these auctions and look for good deals on used cars.