How To Get a Car Dealer License

Showing off car to client

The automobile industry is one of the businesses that have kept a strong and steady growth throughout the years. Through economic recessions and boom times, the car manufacturers are still going strong. The Ford assembly lines still continue to churn out vehicles day in and day out. If you want to get some piece of the action on cars and autos, become an authorized car dealer. Just as cars need an automobile license, you need a license to deal, too. Here are the steps that you need get your own car dealer license.

  1. Determine what type of car dealer you are. There are two general categories of car dealers. The first are the wholesale car dealers, and the second are the retail car dealers. Choosing which type of dealer you will be is important since the restrictions on dealing for the wholesalers and the retailers are different. If you choose to be wholesale car dealer, you will have to worry about lesser restrictions when it comes to the requirements needed to operate the business. It takes a large sum of capital, however, to become a wholesale car dealer. For many, this is an investment that is rather risky. If you want to become a retail car dealer, on the other hand, you will have tighter restrictions to meet and more requirements to provide. But, you will not need to become a wholesaler. Wholesalers can only interact with retailers, and not the general public. Direct selling to the public consumers can only be done by the retailers. Remember not to transfer license, whatever happens. Dealer auctions should apply for a different license.
  2. Prep class. Once you have decided on what type of auto dealer you want to become, the next step is to take the preparation test. Depending on the state where you are planning on opening your business, you will need six hours of car dealership preparatory lessons or more. These lessons will end with a 40 question examination that you need to pass. Once you have passed the test, you will need to undergo an on-site inspection. Other requirements that you need to submit are your fingerprints, and photographs.
  3. Zoning. Once you have successfully finished the preparatory class, you will need to work on setting up your shop. Keep in mind that one of the most difficult parts of setting up a shop is the zoning laws that are applied in your area. Car shops cannot be set up just about anywhere. Instead, you will need to talk with your local zoning authorities and must obtain an approval letter from the zoning department. You will also need to submit a DMV bond application.
  4. Complete the shop. Once you have established where you will set up shop, the building itself must be approved by the zoning authorities and other pertinent licensing bodies. The building should have an office, a display area, a business license, locked cabinets, checkbooks, telephones, inside signs, and a dealer book from the DMV. After this, you will be given a temporary car dealer license within 30 days. The permanent license will be provided after four months or less.

Getting your car dealer license will require a bit of time and effort and even has a tax license and tag license. With a well run business set up in a strategic location where the market demands for automobiles are high, however, your efforts will pay off.


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