What are the requirements for opening a used car dealership?
3 Answers
Opening a used car dealership requires obtaining a business license. Application location: You can directly go to the local Administration for Industry and Commerce to apply. Required materials: ID card: The ID card of the founder of the used car trading company; Organization code certificate: Enterprises need to obtain an organization code certificate; Relevant certificates: Personal driver's license, motor vehicle registration certificate, proof of origin or unified invoice for the used car, compulsory traffic insurance, and additional purchase tax certificate. Other requirements: It is also necessary to ensure that the used cars being sold have no traffic violations, no mortgages, are within the valid period of annual inspection, and that the vehicle appearance matches the picture on the driver's license.
I've been in the used car industry for many years. To open a used car dealership, the first thing you need is sufficient capital. You not only have to prepare funds for purchasing vehicles but also consider fixed expenses like venue rent and staff salaries. When choosing a storefront, opt for a location with convenient transportation, preferably near main roads or around car markets, so customers can easily come to view cars. Business registration procedures must be complete, especially the licenses related to used car transactions—this is absolutely not something to be careless about. In terms of staffing, you must at least have a technician who understands vehicle inspection and experienced salespeople. I've learned this the hard way—I once bought a car that had been in an accident without realizing it. With the internet being so advanced nowadays, you also need someone skilled in short video operations, otherwise customer acquisition costs will be too high. A repair workshop and equipment are also essential—doing simple refurbishments yourself saves money. The most critical aspect is still the vehicle sourcing channels—either knowing fleet owners or having fixed partnerships with car dealers.
Recently helped a friend open a used car dealership, with several key requirements. Money is the top priority - startup capital needs to be at least 500,000 RMB, with vehicle acquisition costs taking the largest share. Choosing a location at the urban-rural fringe is most cost-effective, with a 200+ square meter display area being ideal. For licenses, besides the business license, don't forget the used car dealership registration. Keep the staff lean - three people are sufficient, but a certified appraiser is mandatory. For equipment, basic tools like vehicle lifts and diagnostic computers must be available. Acquisition channels are crucial - I recommend starting with auction houses and 4S trade-in vehicles for lower risk. Nowadays customers love short videos, so dedicated livestreaming and online displays are essential - our three weekly livestreams have been quite effective.
