Car Dealership Business Plan Template - How to start a Car Dealership Business

Are you interested in starting your own Car Dealership Business?
If you're thinking about starting a car dealership, there are a few things you need to know. First, you'll need to obtain a license from your state's motor vehicle department. Once you have your license, you'll need to find a suitable location for your dealership and build or lease a facility that meets your state's requirements. You'll also need to stock your dealership with vehicles, and you can buy vehicles from other dealerships or auction houses or source vehicles from manufacturers. Once you have your inventory, you'll need to hire sales staff and develop marketing and advertising plans. Starting a car dealership can be complex, but if you do your homework and develop a sound business plan, it can be a very successful venture.
Global Market Size
The global automotive retail market is vast, worth an estimated $1.2 trillion in 2018. But starting a car dealership is not for the faint of heart or wallet. It takes significant resources and knowledge to be successful. You need to know a few key things before starting a car dealership. First, you need to understand the global automotive market. The market is constantly changing, so you must be up-to-date on the latest trends. Second, you need to have a deep understanding of the car business. This includes knowing how to buy and sell cars, as well as how to finance and service them. Third, you need to have a strong marketing strategy. You need to be able to attract customers and build a loyal following. If you're thinking of starting a car dealership, these are a few things you need to keep in mind. You can succeed in this competitive industry with the right resources and knowledge.
Target Market
When starting a car dealership, your target market is critical. You'll want to ensure that you're catering to the right audience and reaching the people who are most likely to buy from you. One of the best ways to determine your target market is to think about who your ideal customer is. What are their demographics? What do they like and dislike? What do they need and want from a car dealership? Once you understand your ideal customer well, you can start to craft your marketing strategy around them. Remember, your target market will be one of the most critical factors in the success of your business, so make sure you take the time to get it right.
Business Model
There are a few different business models that you can use when starting a car dealership. The first option is to be a franchised dealership. You will be an authorized dealer for a specific car brand. The benefits of this option include having access to the manufacturer's marketing and advertising resources and offering customers a wide selection of vehicles. However, the downside is that you will have to pay franchise fees, and you may be limited in the types of cars you can sell. Another business model is to be an independent dealership. This option gives you more flexibility in the types of cars you sell, but it can be more challenging to compete with larger franchised dealerships. You will also need to ensure that you have a good selection of cars in stock, a good location, and knowledgeable staff. Whichever business model you choose, starting a car dealership can be a great way to enter the automotive industry. There are a lot of opportunities for success, but it is essential to do your research and make sure that you are prepared for the challenges you may face.
Competitive Landscape
If you're considering starting a car dealership, you'll need to be aware of the competitive landscape. There are a lot of car dealerships out there, so you'll need to find a way to stand out from the crowd. One way to do this is to focus on a niche market. For example, you could specialize in selling electric cars or cars for people with disabilities. By focusing on a specific type of customer, you'll be able to meet their needs better and compete against other dealerships trying to cater to a broader audience. You'll also need to ensure that your dealership is located in a good location. This means being visible and easily accessible to potential customers. If your dealership is tucked away in a remote location, it will be much harder to attract customers. Finally, you'll need to make sure that your prices are competitive. This doesn't mean you have to be the cheapest dealership, but you'll need to offer value for money. If your prices are too high, you'll find it challenging to attract customers. But if your prices are too low, you might not make enough profit to sustain your business. By keeping these things in mind, you'll be better positioned to compete against other car dealerships in your area.

Legal and Regulatory Requirements

Starting a car dealership involves complying with various legal and regulatory requirements. These may include obtaining a car dealership license, securing the necessary permits, and having the proper insurance coverage. It's important to research and understand the requirements for your specific location and industry to ensure compliance and avoid legal issues.

Location and Facilities

The location and facilities of a car dealership are crucial to its success. The dealership should be in a visible and accessible location, with ample parking for customers. The facility should be well-maintained and provide a comfortable environment for customers to browse and purchase vehicles. A showroom should be attractive and have sufficient space to showcase vehicles.

Inventory Management

Proper inventory management is essential for any successful car dealership. This includes acquiring inventory through purchasing and trade-ins, pricing the inventory competitively, and tracking sales and revenue. Keeping an eye on market trends and customer preferences can help with purchasing decisions and pricing strategies.

Marketing and Advertising

Effective marketing and advertising strategies are crucial for attracting customers and growing your car dealership. Digital marketing strategies such as search engine optimization (SEO) and social media advertising can be highly effective in reaching potential customers. Traditional marketing tactics such as direct mail and community outreach can also be effective. It's important to continuously evaluate and adjust your marketing strategy to stay competitive.

Financing and Funding

Financing and funding are critical to the success of a car dealership. This may include obtaining loans, seeking investors, or applying for grants. It's important to carefully research and evaluate your financing options to ensure you have the necessary resources to start and grow your business.

Human Resources

Hiring, training, and managing employees are essential components of running a successful car dealership. Staffing needs may include salespeople, service technicians, and administrative personnel. It's important to establish clear job descriptions, provide adequate training, and maintain a positive work environment to retain employees and build a strong team.

Technology and Innovation

Technology can play a significant role in improving the operations and customer experience of a car dealership. This may include using digital tools for inventory management, sales, and customer service. Investing in technology can help streamline operations, increase efficiency, and improve customer satisfaction. It's important to stay up-to-date with emerging technologies and industry trends.

Customer Service

Providing excellent customer service is critical for building a strong customer base and maintaining a positive reputation. This may include providing personalized service, offering flexible financing options, and being responsive to customer inquiries and concerns. Building strong customer relationships can lead to repeat business and referrals.

Future Trends

The automotive industry is constantly evolving, and car dealerships must adapt to emerging trends and challenges. This may include electric vehicles, self-driving cars, and changing consumer preferences. Staying informed about future trends can help car dealerships stay competitive and continue to grow in the future.

Resources and Tools

Starting and managing a car dealership requires access to helpful resources and tools. This may include industry associations, trade publications, and software platforms. These resources can provide valuable information and insights to help car dealerships succeed.
Starting your car dealership can be a great way to get into the automotive industry and build your own business. However, you should keep a few things in mind before getting started. First, you'll need a good business plan and a solid understanding of the automotive industry. You'll also need to find the right location for your dealership and ensure you have the necessary licenses and permits. Finally, you'll need to stock your dealership with a good selection of vehicles and hire a qualified sales staff. If you keep all these things in mind, you'll be well on your way to starting a successful car dealership.
Why Write a Business Plan?


A business plan is a critical tool for businesses and startups for a number of reasons:
  • Business Plans can help to articulate and flesh out the business’s goals and objectives. This can be beneficial not only for the business owner, but also for potential investors or partners
  • Business Plans can serve as a roadmap for the business, helping to keep it on track and on target. This is especially important for businesses that are growing and evolving, as it can be easy to get sidetracked without a clear plan in place.
  • Business plans can be a valuable tool for communicating the business’s vision to employees, customers, and other key stakeholders.
  • Business plans are one of the most affordable and straightforward ways of ensuring your business is successful.
  • Business plans allow you to understand your competition better to critically analyze your unique business proposition and differentiate yourself from the market.
  • Business Plans allow you to better understand your customer. Conducting a customer analysis is essential to create better products and services and market more effectively.
  • Business Plans allow you to determine the financial needs of the business leading to a better understanding of how much capital is needed to start the business and how much fundraising is needed.
  • Business Plans allow you to put your business model in words and analyze it further to improve revenues or fill the holes in your strategy.
  • Business plans allow you to attract investors and partners into the business as they can read an explanation about the business.
  • Business plans allow you to position your brand by understanding your company’s role in the marketplace.
  • Business Plans allow you to uncover new opportunities by undergoing the process of brainstorming while drafting your business plan which allows you to see your business in a new light. This allows you to come up with new ideas for products/services, business and marketing strategies.
  • Business Plans allow you to access the growth and success of your business by comparing actual operational results versus the forecasts and assumptions in your business plan. This allows you to update your business plan to a business growth plan and ensure the long-term success and survival of your business.
Business Plan Content


Many people struggle with drafting a business plan and it is necessary to ensure all important sections are present in a business plan:
  1. Executive Summary
  2. Company Overview
  3. Industry Analysis
  4. Consumer Analysis
  5. Competitor Analysis & Advantages
  6. Marketing Strategies & Plan
  7. Plan of Action
  8. Management Team

The financial forecast template is an extensive Microsoft Excel sheet with Sheets on Required Start-up Capital, Salary & Wage Plans, 5-year Income Statement, 5-year Cash-Flow Statement, 5-Year Balance Sheet, 5-Year Financial Highlights and other accounting statements that would cost in excess of £1000 if obtained by an accountant.

The financial forecast template is an extensive Microsoft Excel sheet with Sheets on Required Start-up Capital, Salary & Wage Plans, 5-year Income Statement, 5-year Cash-Flow Statement, 5-Year Balance Sheet, 5-Year Financial Highlights and other accounting statements that would cost in excess of £1000 if obtained by an accountant.

Instructions for the Business Plan Template

To complete your perfect Car Dealership company business plan, fill out the form below and download our Car Dealership business plan template. The template is a word document that can be edited to include information about your Car Dealership business. The document contains instructions to complete the business plan and will go over all sections of the plan. Instructions are given in the document in red font and some tips are also included in blue font. The free template includes all sections excluding the financial forecast. If you need any additional help with drafting your business plan from our business plan template, please set up a complimentary 30-minute consultation with one of our consultants.

Ongoing Business Planning


With the growth of your business, your initial goals and plan is bound to change. To ensure the continued growth and success of your business, it is necessary to periodically update your business plan. Your business plan will convert to a business growth plan with versions that are updated every quarter/year. Avvale Consulting recommends that you update your business plan every few months and practice this as a process. Your business is also more likely to grow if you access your performance regularly against your business plans and reassess targets for business growth plans.


Want a Bespoke Business Plan for your Car Dealership Business?
Our Expertise


Avvale Consulting has extensive experience working with companies in many sectors including the Car Dealership industry. You can avail a free 30-minute business consultation to ask any questions you have about starting your Car Dealership business. We would also be happy to create a bespoke Car Dealership business plan for your Car Dealership business including a 5-year financial forecast to ensure the success of your Car Dealership business and raise capital from investors to start your Car Dealership business. This will include high-value consulting hours with our consultants and multiple value-added products such as investor lists and Angel Investor introductions.


About Us


Avvale Consulting is a leading startup business consulting firm based in London, United Kingdom. Our consultants have years of experience working with startups and have worked with over 300 startups from all around the world. Our team has thousands of business plans, pitch decks and other investment documents for startups leading to over $100 Million raised from various sources. Our business plan templates are the combination of years of startup fundraising and operational experience and can be easily completed by a business owner regardless of their business stage or expertise. So, whether you are a budding entrepreneur or a veteran businessman, download our business plan template and get started on your business growth journey today.
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Car Dealership Business Plan Template FAQs

What is a business plan for a/an Car Dealership business?

A business plan for a Car Dealership business is a comprehensive document that outlines the goals, strategies, and financial projections for starting or expanding a car dealership. It serves as a roadmap for the business, providing a clear direction and outlining the steps necessary to achieve success.

The business plan typically includes information about the target market, competitive analysis, marketing strategies, operational plans, and financial forecasts. It also includes details about the management team, organizational structure, and any unique selling propositions or competitive advantages of the dealership.

A well-written business plan for a Car Dealership business helps entrepreneurs secure funding from investors or lenders, attract potential partners or key employees, and guide decision-making throughout the startup or expansion process. It provides a blueprint for the business owner to follow and helps ensure that all aspects of the dealership are thoroughly considered and planned for.

How to customize the business plan template for a Car Dealership business?

To customize the business plan template for a Car Dealership business, follow these steps:

1. Open the business plan template: Start by purchasing or downloading a Car Dealership business plan template. Save the template to your computer and open it in a word processing or spreadsheet program.

2. Customize the cover page: Modify the cover page to include your Car Dealership business name, logo, and contact information. This will provide a professional and branded appearance.

3. Update the executive summary: Edit the executive summary section to reflect the unique aspects of your Car Dealership business. Include a brief overview of your company's mission, vision, and goals.

4. Describe your business: Provide detailed information about your Car Dealership business, including its legal structure, location, and ownership. Explain the services you will offer, such as selling new or used cars, financing options, and additional services like maintenance or repairs.

5. Conduct market research: Research and analyze the market for Car Dealerships in your area. Customize the market analysis section by including data on competitors, target customers, market trends, and potential growth opportunities.

6. Develop a sales and marketing strategy: Outline your Car Dealership's sales and marketing strategy. Define your target audience, pricing strategy, promotional activities, and advertising channels. Tailor this section to align with your specific business goals.

7. Create financial projections: Customize the financial projections section by inputting your Car Dealership's estimated revenue, expenses, and profitability. Adjust the numbers based

What financial information should be included in a Car Dealership business plan?

In a Car Dealership business plan, it is important to include a comprehensive set of financial information. This information should provide a clear overview of the financial feasibility and potential profitability of your car dealership venture. Here are some key financial components that should be included:

1. Start-up Costs: Outline the initial investments required to launch your car dealership, such as purchasing or leasing the dealership space, acquiring inventory, obtaining necessary licenses and permits, hiring staff, marketing expenses, and any other significant expenses.

2. Sales Projection: Provide a detailed sales forecast that estimates the number of vehicles you expect to sell monthly or annually. This should include both new and used vehicles, broken down by make, model, and price range. Consider market trends, competition, and historical sales data to develop realistic projections.

3. Pricing Strategy: Explain your pricing strategy for both new and used vehicles. Outline the profit margins you aim to achieve, taking into account the costs associated with acquiring and preparing vehicles for sale, dealership expenses, and any financing options you may offer.

4. Operating Expenses: Detail your monthly and annual operating expenses, including rent or mortgage payments, utilities, insurance, payroll, advertising, maintenance and repairs, administrative costs, and other overhead expenses. Be as specific as possible to accurately reflect the financial requirements of running your car dealership.

5. Financing Needs: Determine your financing needs and outline how you plan to fund your car dealership. This can include personal savings, loans, investments, or partnerships. Specify the amount of

Are there industry-specific considerations in the Car Dealership business plan template?

Yes, there are industry-specific considerations included in the Car Dealership business plan template. The template will cover topics such as market analysis, competitive analysis, target market, sales and marketing strategies, and financial projections specific to the car dealership industry. It will also include sections on inventory management, customer relationship management, and supplier relationships, which are crucial aspects of running a successful car dealership. Additionally, the template may include information on licensing and regulatory requirements that are specific to the automotive industry.

How to conduct market research for a Car Dealership business plan?

To conduct market research for a Car Dealership business plan, follow these steps:

1. Identify your target market: Determine the types of customers you want to attract, such as individuals looking for new or used cars, specific brands, price ranges, or demographics.

2. Analyze the competition: Research and analyze other car dealerships in your area. Look into their inventory, pricing, advertising strategies, customer reviews, and customer service. Identify their strengths and weaknesses to find opportunities for differentiation.

3. Understand customer preferences: Use surveys, focus groups, or online research to gather insights on customer preferences, including preferred car models, features, pricing, financing options, and customer service expectations.

4. Study market trends: Keep up with the latest trends in the automotive industry, such as electric vehicles, autonomous driving, or online car sales. Understand how these trends may impact your business and adjust your plans accordingly.

5. Evaluate market size and growth potential: Determine the size of the market you plan to target and assess its growth potential. Consider factors like population growth, disposable income levels, and local economic conditions to gauge the demand for cars in your area.

6. Assess customer buying behavior: Understand how customers make purchasing decisions. Consider factors like the importance of brand reputation, price sensitivity, financing options, and the role of online research. This will help you tailor your marketing and sales strategies accordingly.

7. Research legal and regulatory requirements: Familiarize yourself with the legal and regulatory requirements for operating a car

What are the common challenges when creating a business plan for a Car Dealership business?

Creating a business plan for a Car Dealership business can come with its own set of challenges. Some common challenges that you may encounter include:

1. Market Analysis: Conducting thorough research and analysis of the automotive industry, including current market trends, competition, and customer preferences, can be time-consuming and complex.

2. Financial Projections: Estimating accurate financial projections, including sales forecasts, expenses, and profitability, can be challenging as it requires a deep understanding of the industry and the specific dealership's operations.

3. Inventory Management: Determining the optimal inventory levels, sourcing reliable suppliers, and managing the costs associated with maintaining a diverse range of vehicles can be a challenge.

4. Financing Options: Identifying and securing appropriate financing options for purchasing inventory, equipment, and the dealership premises can be a complex task, especially considering the capital-intensive nature of the business.

5. Marketing and Advertising: Developing effective marketing and advertising strategies to attract customers and increase sales requires careful planning and a thorough understanding of the target market.

6. Staffing and Training: Hiring and retaining skilled employees, including salespeople, mechanics, and administrative staff, can be a challenge due to the specialized nature of the automotive industry and the need for ongoing training.

7. Compliance and Regulations: Complying with various federal, state, and local regulations, including licensing, permits, and environmental standards, can be complex and time-consuming.

8. Competitive Advantage: Differentiating your dealership from competitors and offering unique value propositions can be a

How often should I update my Car Dealership business plan?

We recommend reviewing and updating your Car Dealership business plan at least once a year. However, it is important to note that business plans should be living documents that adapt to changes in the market, industry, and your own business goals. Therefore, if you experience significant changes or milestones such as entering new markets, introducing new products or services, or facing challenges, it may be necessary to update your business plan more frequently. Regularly revisiting and updating your business plan ensures that it remains relevant, reflects your current strategies, and helps you stay on track towards achieving your business objectives.

Can I use the business plan template for seeking funding for a Car Dealership business?

Yes, you can definitely use the business plan template for seeking funding for a Car Dealership business. The business plan is an essential document that provides a comprehensive overview of your business, including its goals, strategies, and financial projections. It demonstrates to potential investors or lenders that you have a solid understanding of the industry, a well-thought-out plan for success, and the ability to generate profits. By using a business plan template specifically designed for a Car Dealership business, you can effectively present your unique value proposition and convince investors of the viability and profitability of your venture.

What legal considerations are there in a Car Dealership business plan?

When creating a Car Dealership business plan, it is crucial to consider various legal aspects to ensure compliance with applicable laws and regulations. Here are some key legal considerations:

1. Business structure: Determine the most suitable legal structure for your Car Dealership, such as a sole proprietorship, partnership, limited liability company (LLC), or corporation. Each structure has different legal implications in terms of liability, taxation, and ownership.

2. Licensing and permits: Research and obtain all necessary licenses and permits required to operate a Car Dealership in your jurisdiction. This may include a dealer license, salesperson license, or a motor vehicle dealer bond.

3. Compliance with consumer protection laws: Familiarize yourself with consumer protection laws that govern car sales, such as truth in advertising, fair pricing, warranty requirements, and disclosure of vehicle history (e.g., accidents, damages, recalls). Ensure your business plan outlines how you will comply with these laws.

4. Contracts and agreements: Develop standard contracts and agreements to govern your transactions with customers, suppliers, and employees. Include terms and conditions, sales agreements, consignment agreements, and employment contracts to protect your business interests and mitigate legal risks.

5. Intellectual property: Consider trademarking your dealership's name, logo, or slogan to protect your brand identity. Conduct a thorough search to ensure your chosen branding elements do not infringe upon existing trademarks or copyrights.

6. Data protection and privacy: If your Car Dealership collects and stores customer information, implement appropriate