The market demands new products
The growth rate of car sales has been declining in recent years, due to the gradual saturation of this market. At the same time, models of new or little-known brands sell well in Russia. Therefore, it makes sense for entrepreneurs planning to open dealerships to arrange supplies of cars that are rare or have no sales history in our country. The lowest frequency of presence of machines of this type is in the regions east of the Urals.
There are not many dealers as such: in Novosibirsk, for example, only a few brands have more than one dealer. In neighboring Siberian cities - Tomsk, Irkutsk, as well as Barnaul and Kemerovo - many well-known car brands are not sold at all. Distributors tend to pay attention to localities with a higher number of inhabitants.
Advantages
It should be noted that today many are interested in the question: “How to become a dealer in the region without investment?” The fact is that novice entrepreneurs are attracted to this type of activity primarily because it does not involve significant costs for business development.
Today you can easily find advertisements in the media with the following content: “Work. Dealer in Moscow." Many people respond to them, since the supplier company provides all possible assistance and support in building a business and offers profitable cooperation programs. But not everyone manages to stay afloat.
First a competition, then a business
Choosing a promising market geography is only the first step of an entrepreneur on the path to opening a dealership. How to become a distributor? You must be selected according to the criteria of the car manufacturer. The latter, as a rule, is interested in such information as the authorized capital of the dealer, characteristics of the sales center, information about the profile of the enterprise, and the distributor’s business plan.
In total there are about 30 provisions. They are divided into four main groups: legal, financial, material and human resources. But this is only the first round of selection: then a complex negotiation process will follow, following which the automaker will choose a specific dealer.
It happens that none of the proposals of the competitors suits the factory, therefore, the procedure starts again. Often entrepreneurs themselves do not understand how to become a car dealer in accordance with all the intricacies of the process.
This is exactly what happened in Omsk, when Skoda organized a competition to open an official representative office. Some manufacturers establish a kind of trial period (as, for example, Volvo does), stipulated in the contract with the dealer who wins the competition. It is worth noting that the distributor who shows that its image fully corresponds to the brand code of the machine supplying factory has the highest chance of winning.
Goods for sale
Those who are interested in the question: “How to become a dealer in the region without investment?” should be aware of the second common option for cooperation – goods for sale.
Its meaning is that the sales representative is given a specific period of time during which he must sell the product. After the agreed period, it will need to be paid, and the contract amount may increase by 2-3% compared to the situation if you had paid in advance. In any case, there is a risk of burning out. If you fail to meet the agreed time frame, be prepared to compensate the supplier for losses incurred. Only under force majeure circumstances can you accept unsold goods back.
Entry threshold is high
Since selling cars is a serious business, the criteria for admitting entrepreneurs to the market are much higher than in most other industries. You can’t just get into this segment. A businessman with high financial capabilities can become a distributor: the initial investment in a dealership center can amount to millions of dollars, or even tens of millions (as was the case with Novosibirsk showrooms selling Nissan and Toyota brands). Not counting “seed” investments, in order to be competitive, a business will be forced to invest in advertising, and this, according to experts, is about another 200 thousand euros every year.
The time it takes for a dealership to break even is also long – 5 years or more. This indicator tends to increase over the years: the rate of profit, as the market becomes saturated, falls all the time. In Europe, for example, dealers earn about 2% from sales of finished cars. The figure for auto parts may be significantly higher – about 30%, and entrepreneurs should pay special attention to this fact. At the same time, there are not many businessmen who are ready to work under all these conditions, especially in provincial cities.
Working conditions as a dealer
To become a dealer , as a rule, you must have a stable financial position. If the candidate meets the following requirements, then he has the opportunity to be accepted into the team:
- Preference is given to candidates with experience in the company's field of activity.
- The dealer must have a business plan.
- The representative must be interested in the company's services/products and be results-oriented.
- The dealer must have the necessary equipment.
- The dealer must have the ability to invest in procurement/construction.
The company is interested in promoting its products in different regions, therefore, if a dealer network is already developed in the city of your choice, you may receive a refusal. The solution is to look for a new manufacturing company or move to a region that is not occupied for activities.
Subtleties of arrangement
If the competition is passed and the money is found, then the next step of the entrepreneur is to organize the infrastructure. A functioning dealership includes a number of components. Firstly, it must be a parking lot equipped with all the necessary accessories. This object is the face of the dealer company and an important factor in successful sales.
Secondly, all cars displayed in the showroom must be brought to a shine: you will need a high-quality car wash. Thirdly, cars require constant care in terms of technical control: the dealer will need its own car service.
Fourthly, since we have determined that the greatest profitability in this business comes from the sale of spare parts, the company’s infrastructure will have to include a separate store of this profile. For each of the marked divisions of the dealership, qualified personnel will have to be hired.
How to become a successful dealer
To become a successful dealer, you need to constantly develop yourself and your business. This includes increasing the client flow, improving the design of the business, upgrading personal qualities, and finding more qualified personnel.
Sell a popular product
In order to successfully sell a product, there needs to be demand for it. If you try to sell sleds in Thailand, then most likely, no matter how talented a seller you are, you are unlikely to succeed in this enterprise. The time when you could sell anything is long gone. People are wary of new offers and products, as well as intrusive advertising.
Form your client base and constantly expand it
A dense flow of customers ensures good profits and success for the dealership. Therefore, it is important to form and maintain a customer base. To do this you need:
- Analyze the market. Where do your clients spend their time? What are they buying? What need will your product satisfy?
- Collect buyer contacts. To offer a product to a buyer, it is important to know how to contact him. There are different ways to collect contact information about your potential client. These are both online databases, which are collected using the parsing method (if sales are carried out on social networks), and offline databases for working over the telephone. If you plan to sell goods through a store, you can issue savings cards to customers indicating their contact information, in order to inform them about discounts and bonuses later.
Appreciate regular customers
It is important to recognize regular customers by sight, provide them with bonuses and create loyalty programs. If customers see your good attitude towards them and your unique approach, they will come back to you again and again, and also recommend you to their friends, which will ensure constant sales and even expand your base due to positive reviews.
Create a positive image
To sell your or someone else's product well, it is important to make a positive impression on people. This includes an attractive appearance, a manner of communication, and the ability to negotiate, treating the interlocutor with respect and showing moderate persistence in the presentation of one’s ideas. It is important to be able to convey information not only verbally, but also non-verbally. Gestures, voice, manner of communication, gaze can also affect the impression of you and, accordingly, the decision to cooperate. Therefore, you need to create an image of a successful person who knows what to do and who you can trust.
We position ourselves optimally
The geography of the car dealership location must be clearly thought out. How to open a distribution company taking into account this factor? The most important condition is the location of the company near an actively used highway. This is a general law for any market: the higher the customer traffic, the better the sales.
Potential clients need to create conditions for a convenient visit to the salon: that is, if there is initially no equipped exit from the highway, then the entrepreneur will have to build it himself.
The display window of a car dealership must be directed towards the road where future buyers are coming from. That same busy highway may not be in the city center: it is necessary to study the transport infrastructure of the streets and find a place where the intensity of traffic and the costs of building (renting) a car dealership and adjacent facilities will be optimally combined.
As mentioned above, the most important component of the profitability of a car sales business is after-sales service. It is fundamentally important to create conditions for comfortable access to the center for two groups of clients at once - those who travel to purchase a car, and those who pay a visit to the dealership to buy spare parts.
Formalities
How to become a distributor and work legally? The entrepreneur will have to register as a legal entity. The best option is a limited liability company. The specifics of working in this status, however, are such that you will need to deal with VAT, as well as tax on imputed income - this must be taken into account.
When applying for state registration, it is best to use the following OKVED codes: 50.10, 50.20, and 50.3. These values allow the company to conduct business in the trade of motor vehicles, carry out vehicle maintenance, repair them, and also sell spare parts, assemblies and parts.
It is imperative to note the most important code in OKVED - 65.23.2. It means that the company will operate as a dealer. It is important for an entrepreneur not to forget to register the company with pension funds, as well as with non-budgetary Russian funds.
The practice of the dealership business is such that it will require paperwork with the State Fire Supervision Authority and Rospotrebnadzor. The next steps are to open a cash account at a bank, purchase a cash register and other equipment of this profile.
And finally, you will need to go to the Consumer Market Department to enter information about the company in the trade register, and then receive a certificate there. You may need certificates for carrying out work in auto service mode - they are issued by Rostest. How to become a car dealer and successfully go through all these complex procedures are questions that are very relevant for entrepreneurs.
Video: how to become a dealer
Dealership is an excellent activity for those who know how and love to sell. You will be able to realize your full potential. To become a dealer, you need to choose the products that interest you, find a supplier, and find a way to trade and cooperate. To succeed, you need to be not only a salesman, but also a bit of an analyst. Market analysis will help you find a popular product and correctly offer it to the client. Regular customers are the main source of income and word of mouth advertising, so they need to be valued by offering various bonuses. It is also important to create a pleasant impression and be able to negotiate.
Author of the article: sites
Selecting suppliers
The business plan of a distribution company must, first of all, include provisions regarding the price segment in which sales will be conducted. Actually, the more expensive the brand, the higher the degree of its promotion, the greater the amounts that the entrepreneur will have to invest in the business. From time to time, a car dealership will have to incur costs associated with certain brand requirements regarding business strategy.
It is quite acceptable to start selling cars of low-budget brands, then, as demand is identified, move on to more expensive ones. The option of combining several brands in one salon is not excluded. It must be borne in mind that some manufacturers are very picky about the marketing policies of dealers and like to advise what should be done and how.
The methods of foreign brands may differ from those that are typical for Russian companies, but our entrepreneurs are increasingly thinking about how to become a dealer of a foreign company. The demand for cars from abroad among Russian citizens is growing at an impressive pace.
Qualities required for a mediator.
Not every person is given the opportunity to reveal himself in the field of trading; for this you need to have certain qualities, without which you should not even start, otherwise you will simply waste your energy, time and money. You can become a representative of one of the most popular cosmetics companies, Avon, and earn money without leaving home on the official website https://myavon-company.ru
To expect success, you must have the following qualities:
- - Stress resistance;
- - Determination;
- — Competitiveness;
- — Activity;
- — Initiative.
This set of qualities will allow you to achieve success in your business and grow professionally and financially.
Remember that you should simply radiate confidence - “that you are right.” Your task is to convince potential customers that the product you offer is the best and highest quality. If you are negotiating with a representative of stores or other retail chains, then try to make them believe that the products you provide will simply be swept off the shelves. You must be very convincing and have a thorough knowledge of the products you offer in order to persuade them to cooperate with you. Be prepared for the fact that there will be failures, this should not unsettle you, know that “your” client is waiting for you somewhere, you just need to find him. But if you don’t find it, then you can become a representative of one of the most popular cosmetics companies, Avon, and earn money without leaving home, on the official website https://myavon-company.ru
Why Honda?
Cars of this Japanese brand fit perfectly into the Russian market. Firstly, Honda cars have increased wear resistance of parts - much higher than, say, most Chinese foreign cars that are gradually flooding car dealerships in our country. The quality of the metal from the “Japanese” is invariably high. Honda is one of the world's largest manufacturers of automobile engines. This brand is a leader in technology and level of development of various mechanical components.
Many Honda cars have reduced gas and engine oil consumption. The engines of this manufacturer are very easy to start and meet the most modern environmental requirements. The extensive network of Honda branded services is one of the largest in the world, and the car dealer will not have problems supplying their showrooms with original spare parts. But before deciding how to become a Honda dealer and adapt the business to selling cars of this brand, the entrepreneur needs to find out whether the Japanese are suitable for the market of a particular region.
Where to buy cars?
The easiest option is to find suppliers in the country where the cars are manufactured. However, under this scenario, the dealer will have to work on logistics himself and control the transport delivery channels from the factory to the showroom.
Among the mandatory procedures that an entrepreneur must undergo are the purchase of insurance policies for cars, registration of cars at customs, and payment of all necessary fees. To optimize work in this direction, the dealer can create a special structure within the company that delivers the vehicles sold from the factory.
For many businessmen, it is not entirely clear how to become a distributor within the framework of this scheme, and they prefer another option - outsourcing, that is, they find a company willing to do the same with payment for specific types of services. When choosing such a company, you need to make sure that it has a license to carry out transportation, has certificates of compliance with Euro-2 and, as a rule, Euro-3 requirements. You will also need a document confirming the company's status as a licensed customs carrier. Another purchasing format is from an official importer. This greatly simplifies the dealer's work. The only question is to find a competent company of this profile.
Delivery of cars to a car dealership
Vehicles can be supplied from various locations. But for each batch of cars it is necessary to conclude an agreement, which will indicate the terms and conditions of delivery, as well as the price.
You can purchase cars in the following ways:
- In the country of car manufacturer. In this case, all issues related to the delivery of cars from the manufacturer’s plant to the exhibition center are decided by the dealer himself.
- Cars are purchased directly from the factory. The dealer takes care of insurance, delivery of cars to the center, and customs clearance (if the dealer is official, then this procedure will take a little time and will be completed according to a simplified procedure, in one, maximum two days).
To calculate the customs payment, you can go to the website: www.tks.ru/auto/calc. Cars arriving at the dealership undergo pre-sale preparation.
If you use this type of car delivery from abroad, you need to create a car delivery service. You can also create a transport company or contact a transport company that provides this type of service. The cost of such services is approximately 2 thousand dollars per flight.
To transport cars, the carrier must have:
- international license for the transportation of goods;
- certificate of compliance with Euro-2, Euro-3 standards;
- license of an all-Russian customs carrier.
Purchasing cars from an official Russian importer has its own characteristics. In this case, the importer will deal with everything necessary for transporting cars to Russia. He will also handle customs clearance. The second option is very well suited for those who are just starting to sell cars. There is less worry, and the costs will be the same as in the first option.
Calculations can be made in various ways. However, most often, manufacturers require payment of one hundred percent for shipped vehicles (Honda, Volkswagen, Audi, Toyota).
The manufacturer may have its official importer on the Russian market. The importer provides all existing dealers with one warehouse. In this case, the goods will be provided on the terms of a trade loan. The dealer's responsibility is to sell the cars he has taken from the warehouse within one month. If the cars are not sold during the specified period, the importer has the right to charge daily penalties on the cars remaining unsold. After three months, the dealer will be required to buy back unsold vehicles.
The dealer must adhere to the monthly plan for selling cars. When selling cheap cars, the annual plan will be within a thousand cars, and when selling expensive cars, from 260 to 460 units.
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The video shows practical business advice for a new car dealer:
