Car flipping a good business?
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So I am in my 4th semester of collision repair and have had a job in a shoddy place that didn’t turn over jobs fast enough to keep paying me and now I’m currently working at a used car lots body shop.
The manager of the used lots shop said he used to be a car flipper and I know thats the business the lot is in. The owner has buyers in CA, FL and couple others maybe that just buy auction cars send them here and we fix them. Usually replace, fill bumpers, fenders and some door work. We might put in maybe $800-$1000 tops and the owner sells at a mark up of probably like $3000+.
So I am looking for any tips or advice.
Is this a business venture worth getting into these days? Would I need a dealers license? Has anyone ever had problems with selling a crappily repaired job to someone and that person makes an issue of it? I wouldn’t want my name drug through the mud.
I’m aware of coparts.com and ADESA, are there other reliable places to buy light damage cars that only need body work? If you know, how much do running, light body damage cars usually sell for?
I know it’d be easy to break into this business this way and I’ve heard several people say they make “good money” at it but just looking for others experience or advice.
Thanks.
:cheersI’m not sure where you are at, but in Canada it is illegal to do that. However, you can buy and sell a few cars here and there, but doing it as a business requires being licensed both as a car salesman and as a business.
In any case, there is money to be made if you are smart about what you buy. There is really no definitive answer as to weather you can make good money. You need to know your market, know the cars well and be a good salesman.
One very important thing I would like to mention is liability. Make sure to do things properly, have proper insurance in place etc…
Hi, like Ben mentioned, all depends on what part of the country or state you live in, I live in Florida and that’s what I do but the laws are different from state to state. I use someone else license to purchase and sell the vehicles, I have to little experience in body work and no place to do it. Here you are allowed to purchase and sell 3 cars per year as a private entity. There is money to be made but in order to make it you have to spend it first. To get a license you need a line of credit or bond in most states the bond is around $25,000.00, you need a place inspected by Motor Vehicles Division, it has to be approved by the City also, it requires a certain number of parking spaces available (X number of spaces for X number of square feet of location). I am not trying to discourage you, you can do anything you put your mind to it, by all means try!. See if there is someone in your area that will allowed you to use his license for a fee per car purchased. That’s how I do it. Good luck!!
Ben, can I ask why its illegal to do that in Canada? They think it’ll lead to shoddy repairs or something??
Chumpi, since you seem to kind of know the ‘business’ do you have anywhere that’d tell me what I’m looking for? I mean basically I’d be starting a used car lot but only buying like 1-2 cars at a time. Is that basically what I’d be looking into? Would I contact the business bureau or who would I talk to about regulations?
My old boss did this crap and he didn’t even have a business license and just sprayed cars in his garage, which is typically illegal now days but people still do it.
How much hassle is it to get a dealers license?
Have to hit up some google tonight it seems.
My recomendation is to build a few for yourself, find something that looks like a real light hit and something thats cheap to fix. Do a quick search on aftermarket/replacement parts and see what they are running. Sometimes those light hits have headlights that cost between $500.00- $1000.00 to replace also look at airbags etc. What dont seem like expensive stuff can sometimes kill any chance of making a buck. Then go online and see what folks are paying for cars in the same range.
Once you find one get you a box or a file of some sort and some way of logging your time. Track every expense to build it and keep track of your time and once your done figure out if you made enough or not. My son is in the process of building a 2002 Maxima, real light hit in the front didnt kick the air bags or nothing, but what really sucks about the whole thing is those headlights that run $500.00 each. That could make or break you if you are not prepared for it.
Coparts and IAAI are both good sites to go through. But I would look into all the legalities to put these cars back on the road. In Ohio (where I live ) all salvage vehicles have to be inspected and you have to provide reciepts for all the parts you replaced etc. I have heard horror stories from guys stating they had parts siezed from them when they couldnt provide reciepts. I work in Ky where the laws their are entirely different. So look into the laws where you live before you buy something.
I would also not buy anything without going out to look at it in person. It never looks to bad in the pictures on the internet but you also have to realize that it totaled out for some reason. If you can find auctions that deal in rental cars those can be good ones to get into. Alot of times they have clean title cars that they remove from service that will have real light damage. Alot easier to sell a car with a clean title compared to a rebuilt title.Chuck
honestly, it used to be a great business, but now you have to compete with money laundering exporters who jack up the prices. if your skilled, you’ll be better off just repairing them for dealers.
[quote=”vidar77″ post=25180]Ben, can I ask why its illegal to do that in Canada? They think it’ll lead to shoddy repairs or something??
.[/quote]
Curbing is illegally selling cars, generally from a person who is not licensed to sell cars. In Canada each province has a Motor Dealer Industry Council that is a 3rd party to dealers and regulated by the Government to ensure that vehicles are safe and of proper title when sold. In most provinces the Motor Dealer council requires all vehicles that are sold through a dealer to have been inspected and to be free of any liens and have a proper title with full disclosure (generally including a report like Carfax).
The whole principal behind the laws here, are to protect the consumer from fraud and other issues. Up here, if there is a lien on a vehicle, the lein can follow the vehicle from one owner to the other. In a private sale, liens should be disclosed but in some circumstances are not and the new owner can (in some instances) be 100% liable for the outstanding lien. If a vehicle has been in an accident over a certain value ($2000 in BC and Alberta), that will show on the vehicle history report. If the vehicle has been written off, the title is changed to salvage, then if it is rebuilt and re certified its title is changed to rebuilt.
So, a dealership must be licenced (as a business, just like any other business). The dealer is to be registered with the Motor Dealers council (to ensure that the dealer is known to the council and follows their code of conduct) and each individual sales person is required to be registered with the Motor dealer council (to show that the sales person follows the same procedures).
It is a lot of bueracracy, and there are still a lot of people that slip through, but in the end, it keeps the reputable business trustworthy.
There have been many vehilces sold privately (through curbers) that have leins, improper odometer reading, improper repairs, illegally importated from other countries, VIN tampering etc and the whole idea is to prevent this.
here is a link to the [url=http://www.amvic.org/main.htm]Alberta Motor Vehicle Industy Council[/url]
Good post Benny :cheers
There again, where are you located? without that fact it’s pure especulation, Ben is correct and those rules apply to all states in general some have more regulations than others. here in Florida a lien is attached to the title, if the title is clear it means: no liens, no accidents with more than 25% of vehicle value. If you are selling thru a dealer’s lisence there is nothing to worry about, again that’s they way it works here, how it works in Canada I do not know, oor any other place for that matter. Idunnit mention Copart INC and Insurance Auto Auctions both of those places have brokers advertised in the respective web pages that will allow you to use their lisence to purchase at those places for a fee and sell thru them for another fee. Regarding the headlights, I just purchase an Altima 2005: front fenders $75.00 apiece, Hood $97.00, Bumper cover $39.00. Radiator $74.00. Condenser $75.00 Headlights $43.00 a pieace ( don’t have to be HID, you are selling it) Paint and other material $150.00, cost af purchase $2440.00 Dealer’s fee $100.00, sold for $6400.00 cost of selling (dealer’s fee) $50.00. The title was a salvage title needed MVD inspection $40.00. And MoCoke your so right
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