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akhtar

Newbie dealer struggling for 2 years

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I have been in motor trade for 2 years on part-time basis. I cannot seem to find right source of stock. i registered with bca auctions. their stock sells at retail price in auction hall then with buying fees and delivery it leaves no margin for profitnat all. I purchased 4 cars from bca on silver card and sold all 4 of them in Losses of £200 to £500. Manheim is also the same . The only Few cars I made profit on were bought from private sellers for which I had to travel 100s of miles. 

I have only been able to cover my losses and expenses in past 2 years. I would realy appreciate anyone could point me in right direction.I want to become full time trader once a right source of stock is found. Hope to hear from genuine traders.

 

 

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There are no magic formula really. The basics are the same for every small trader. You have to have some idea what is likely to sell in your situation and how to market your stock to people likely to be interested. And most importantly you have to know what the likely selling price of the car you are intending to purchase is, what you are likely to spend on making it saleable standard, and then make sure you can buy it at a price which leaves you a sensible margin. If there is no margin walk away. You will waste a lot of shoe leather walking away, if your doing it right.

We are all essentially fishing from the same ponds, some people have the knack for catching fish, others do not. Patience and persistence is key. And once you have caught the fish, it’s no good to you unless you have a ready market to take it to.

I don’t mean to be brutal...I,m sure others will be. If you have not figured it out how to catch some fish in 2 years, then maybe it’s time to put the rod down and find something more suited to your talents.

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Why aren’t you making a profit?

are you paying too much? paying too much in repairs or not waiting long enough?

give us some examples of cars you have bought and sold and I will tell you where you’re going wrong?

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Maybe the main issue is 'part time' if you're committed to it full time then you'll be focused on 'making profit' and running a business and not playing! 

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This business is never part time, Its bloody hard graft, Anyone thinking its easy money for little effort will realise very quickly its not 

 

this is going to be wrong stock profile and paying to much for them and them having them stick around to long and then it becomes a distress sale

 

 

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I dedicated more hours running a small pitch than building 9 houses last year, part time is almost no time your either all in or all out. 

 

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How are you selling them for a loss ?

Unexpected repairs ? Trying to compete with the bottom of the barrel Facebook Marketplace cars?

 

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If your current logic isn't working then you need to sit down evaluate what you have done and where you are going wrong and trying another route.

With regards to buying stock at auction, don't necessarily buy stuff as it is cheap as the reason its cheap is it may have lots of issues, I would rather pay more for a clean tidy car with bags of history and a sensible mileage than get something that's grade 5 with poor history. Its less donkey work when you buy something tidy to begin with.

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I've been doing it for nearly 2 years myself and I understand your pain! I haven't got it all figured out myself yet but here is some advice which may help you.

1) most of my purchases come from Manheim and vary between hall or online. Whichever you choose always research every car you bid on carefully, from length of mot, past mot issues, tyre condition because if you  buy one with low tread that is a decent cost straightaway. If you do go to the auction, walk round the car with the eyes of the buyer, check every panel, exhaust ,interior, everything that you  can. Listen to it starting up ,see if the engine is quiet,ask the driver if the clutch is ok. What you want to be doing is costing every single thing you can that will in your opinion need sorting, and then work retail back taking off fees and refurb costs.

For me i work back from retail taking off around 300 fees, 400-500 profit and 250 refurb .These figures are rough and vary with each car. You then have a max bid amount, don't go over it. I have bought some cars and made 500-750 easy profit and others i have put loads of hours in and either broke even or lost £100 from it. These buying experiences should hopefully steer you onto cars which you think are profitable. But don't overlook any car if profit is in it. Oddball cars seem to do well for me because there is less competition when you are selling them.

2) If you buy private always check EVERY SINGLE THING that you can. Drivetrain-bodywork-suspension on the test drive-tyres-exhaust-all electrics e.t.c e.t.c .

For me privates are worse than the auctions as so many cars have had issues undeclared by the owners. 

If you cannot see a clear profit after taking off every cost, keep your money in your pocket.

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I think the saying goes 1st year expect to make a loss 2nd year expect to break even and 3rd year things should start getting better. Maybe this is your year if you decide to put more time and effort in

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5 hours ago, akhtar said:

I have been in motor trade for 2 years on part-time basis. I cannot seem to find right source of stock. i registered with bca auctions. their stock sells at retail price in auction hall then with buying fees and delivery it leaves no margin for profitnat all. I purchased 4 cars from bca on silver card and sold all 4 of them in Losses of £200 to £500. Manheim is also the same . The only Few cars I made profit on were bought from private sellers for which I had to travel 100s of miles. 

I have only been able to cover my losses and expenses in past 2 years. I would realy appreciate anyone could point me in right direction.I want to become full time trader once a right source of stock is found. Hope to hear from genuine traders.

 

 

Time to move on to something else I reckon after two years of losing money . 

OR 

Put your heart and sole into it and get on with doing the job properly . Harsh but true words you will learn as you go on .

If the going gets tough , the tough get going and work harder , or change course to something you understand more of maybe . 

As said above its not for every one is the car trade , 

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thanks for replies and advice. The cars I purchase are in the range of £1000 to £2500 . Golfs mark4, Vauxhall Astra, Peugeot 308cc, Ford focus. Main cause of loss is too many bidders and  auction fees plus delivery.

I understand for BCA Gold members it is possible to simply buy cars from catalogue before it goes into auction. Would you all suggest thats beneficial ? Also please give advice is dealerauction.com a genuine site ? 

only reason I have done part time is because of shortage of right stock supplier. Once I find right source I am willing to give it my all.

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6 minutes ago, akhtar said:

thanks for replies and advice. The cars I purchase are in the range of £1000 to £2500 . Golfs mark4, Vauxhall Astra, Peugeot 308cc, Ford focus. Main cause of loss is too many bidders and  auction fees plus delivery.

 

No it isn't. It really, really isn't. 

 

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Most of us have many considerable years in this business and we would all say we are still learning / adapting........................  you dont sound to me as though you have been through any formal franchise / PLC type of car sales employment......................  if thats the case and this is new to you from the first 2 years you have been struggling then this is why you are struggling, I considered when i went on  my own that i had 20 years of doing this exact same thing for an employer and i was about to do exactly same thing but for my self, Was not so daunting, This business is hard cruel and ever changing, I think its just the case you have not had your apprenticeship done in someone eases business, and you are having to learn it from scratch without the benefit of having "trained" at a dealership

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5 hours ago, akhtar said:

I have been in motor trade for 2 years on part-time basis. I cannot seem to find right source of stock. i registered with bca auctions. their stock sells at retail price in auction hall then with buying fees and delivery it leaves no margin for profitnat all. I purchased 4 cars from bca on silver card and sold all 4 of them in Losses of £200 to £500. Manheim is also the same . The only Few cars I made profit on were bought from private sellers for which I had to travel 100s of miles. 

I have only been able to cover my losses and expenses in past 2 years. I would realy appreciate anyone could point me in right direction.I want to become full time trader once a right source of stock is found. Hope to hear from genuine traders.

Something always turns up. For years it always seems I'm at the block and the cars I want are always last. Then you get some trader paying 800 over book. The fees do seem to have rocketed though above inflation. 

When I first started I think on a 1000 pound car I paid about 35 max on top. 

You have to be commited and go to all different auctions. I find bca expensive. Try a smaller independent auction. Auctions do not sell cars at cheap prices. I love it when I overhear a private punter telling his mates or wife how a 5 grand car will be theirs for about 2 grand. Then watching their faces when the hammer goes down. 

 

 

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your main cause of loss is paying too much too start with, not the other factors mentioned.

be more open minded on brands, if you don't like certain brands other customers sure will.

the cars you mention are saleable but you are not really likely to earn anything from them in the price range you mention-  if buying from auction.

you need to understand what the market is wanting / buying, and you simply need to be able to value cars better.

you need a rethink, also, being part time gives no excuse or reason to be incurring certain costs (valeting) or paying others (delivery), find time to either go to auction yourself, (leave buying online to the more experienced), or explore finding stock elsewhere, ideally locally.

as others have said, with respect it might be that after 2 years trying this job might not be for you.

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24 minutes ago, Rory RSC said:

No it isn't. It really, really isn't. 

 

Exactly this,

To be fair it’s nobody’s fault but yours for paying to much for cars. Do your reasearch on the cars you are loooking to buy before you get to the auction and have a fixed amount you are willing to pay. You know how much your fees are so do the maths.

I understand it’s easy to get caught out with unexpected costs but you are in control of the intitial purchase price....

Anyway, best of luck and listen to the guys on here...

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it would appear you are buying the wrong stock at the wrong price then having it delivered

this is all wrong

i assume? you get someone else to do mechanical work and valeting too?

see so many people who do this job half hearted and then give up and a few years later come to me to buy a car,you can tell them a mile off as first thing they do is gun a cold engine,not had one for yonks and hasd one this very week,tried chipping me but i refused him,rather sell to a sensible person

so akhtar reappraise your buying decisions work out how much you can add betterment to your product and do as much yourself as you can,get some trade plates and drive the cars back and view other stock whilst at the auction,its easy buying any stock, selling is the important part

 

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is it possible to find cars at good price from bca catalgue with buy it now option after becoming gold member ?

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1 hour ago, Tony911 said:

I think the saying goes 1st year expect to make a loss 2nd year expect to break even and 3rd year things should start getting better. Maybe this is your year if you decide to put more time and effort in

That goes for most businesses, which is a good reason to start part time to have some cash still coming in whilst you are losing (or should that be learning :) ).

 

if it’s any consolation we’ve been through a similar learning curve. 

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So it's the part timers that are causing the stupid prices at auction , Jack it in and concentrate on your proper job :)

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25 minutes ago, akhtar said:

is it possible to find cars at good price from bca catalgue with buy it now option after becoming gold member ?

not really, the logic of a buy it now is you have the car pre-sold, then you have to realise buy it now's might have issues or the vendor wanted too much and it has not sold previously.

forget becoming a gold member, if you cant make it work on silver your not going to make it work on gold, reduced gold card fee's are not going to launch you into profit.

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5 hours ago, Rory RSC said:

It's not for everyone. Business isn't for everyone. 

This

1 hour ago, Rory RSC said:

No it isn't. It really, really isn't. 

 

And this 

5 hours ago, umesh said:

Maybe the main issue is 'part time' if you're committed to it full time then you'll be focused on 'making profit' and running a business and not playing! 

I have to disagree Umesh. 

I, probably like a lot of others started part time. 

Why wouldn't you? 

You have the income security of your job whilst you get set up and start the ball rolling. 

2 years is a very long time, I did it for 6 months until I believed I was as ready as could be to jump into it full time. 

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