The auto auction business involves buyers purchasing vehicles based on competitive bidding. Starting a car auction business requires a lot of research. The good thing is that you can hold auctions online or at various prime locations that are easily accessible to the target audience. With that said, the following tips will help you get started with your own auto auction business.
1. Research your market.
It’s always best to embark on extensive research about the industry you want to enter. Remember, you’re entering a space where already established brands thrive. Also, purchasing a car is a huge investment. People would want to attend auctions that they trust and can vouch for.
If you’ve yet to convince people why they should trust your company, you need to learn all that entails holding a car auction. This includes consumer expectations and behavior patterns. Also, try researching your competitors to see if you can offer anything they don’t to build your competitive advantage. Simply put, the more research you do, the richer your knowledge about the industry, and the clearer the path will be to building your business.
Once you’ve done some research, the next step is to find a dealer to work with. Some established dealers already have websites with a large variety of car listings. Some of these dealers offer cars at wholesale prices or through an affiliate program.
For example, Auto Auction Mall serves its customers with dealer-level rights to various used car auction platforms in the U.S and North America. Buyers are also given immediate access to well over 150,000 auctioned automobiles. This way, you can save thousands when financing, purchasing, and shipping cars, as it’s done through one suitable portal.
2. Prepare a business plan.
Starting a business without a plan is like going to an unknown destination without a map or compass. You put your business in harm’s way when there’s no clear vision or guide as to what exactly you’re about. A business plan helps you set specific goals, determine your operational strategies, plan employee salaries, workspace location, organizational structure, budget, financial commitments, and customer service approaches, amongst others.
For instance, if you have a physical location, you might want to consider customer service. Serving potential buyers some refreshments will be appreciated. However, we’re talking quality refreshments, not tap water filled with contaminants. For example, consider Canadian Water bottles like those offered by Labrador Source. Their bottled water and mineral water are trusted by many Canadians. Certainly, their water quality and packaging is second to none.
No doubt, having an efficient business plan that encompasses customer service is a strategic way of building your start-up on a firm foundation with long-term considerations for your business. It keeps you in line, ensuring you don’t make impulsive business decisions that may be detrimental to your car auction business. More importantly, periodically referring to your plan gives you insight into your deviations and achievements.
3. Pay attention to competitors.
You can’t afford to ignore your competitors. You need to know what they’re about. Figure out the best ways to learn from them and at the same time, be a step ahead of their game. Also, try to find out if they’re planning on introducing (or have introduced) new products. It might also help to research how they relate with existing, potential buyers as well as their influence in the marketplace.
4. Consider buying an existing business.
Unless you have solid reasons to start your auto auction business from scratch, you should consider acquiring an existing car auction business. That way, you’ll have a base to jumpstart your soon-to-be overwhelming influence in the market. Start-ups aren’t the only option in the entrepreneurship journey.
You can always opt for acquisitions if you have the funds for it. If you’re able to develop the acquired business, all the better. Find a car auction business-for-sale that suits you, and go for it.
All in all, starting an auto auction business is no easy feat. It requires time and commitment, like every other business. The best part is that customers in this market are mostly loyal to the brand name and not the face behind it.