Getting into Car brokering?

[MattS 0]

Hi all,

Before I start I would just like you to know I am ready for a absolute grilling, I know what your thinking here comes another person wanting to do car brokering and thinks it will just take off and make money instantly.

Got a small redundancy payout and want to do my own thing, Ive came to this page for some advice or a contact or anything really?

I am really interested in looking to start my own car brokering business and have spent hours looking into how it works online etc but seem to not really find the info I'm looking for. What I am looking for is information or a crash course in brokering one might call it, I want to start my own business however I need to know all the information first before I even begin to take something like this on, it might not even be for me. I seem to understand you have to have your own business be regulated by the FCA and BVRLA before you have any legal credibility.

Im looking for information about the whole cycle from;

advertising/getting a enquiry all the way down to the car being in the owners hands and you taking commission?

once I've got all this information I want to figure out a Unique selling point what I can offer if there is one

Please any help would be appreciated, and yes I can take criticism on the chin.

 

Thanks Matt

[Mojo121 229]

What are you actually trying to do? Call me stupid but I don't get this whole car brokering business. It seems like just another person trying to stick their finger in the pie, but one that offers completely zero value. Do you know anything about the industry?

These guys seem to do okay - is this brokering?

http://www.palmdale.co.uk

[MattS 0]

19 minutes ago, Mojo121 said:

What are you actually trying to do? Call me stupid but I don't get this whole car brokering business. It seems like just another person trying to stick their finger in the pie, but one that offers completely zero value. Do you know anything about the industry?

These guys seem to do okay - is this brokering?

http://www.palmdale.co.uk

Yeah sort of the same concept I'm looking for, call me dillusional but what I am trying to do is have a client base through advertising and various routes I have thought of, I find people the cars they want and offer them how much its going to be, if they then buy it i would take commission by introducing the buyer to the seller and that is the bit I want info on is how people make commission through finding other people cars? do you get my train of thought ha? I have been sending myself in a ball of confusion trying to work it out or if its even a thing...

[Mojo121 229]

32 minutes ago, MattS said:

Yeah sort of the same concept I'm looking for, call me dillusional but what I am trying to do is have a client base through advertising and various routes I have thought of, I find people the cars they want and offer them how much its going to be, if they then buy it i would take commission by introducing the buyer to the seller and that is the bit I want info on is how people make commission through finding other people cars? do you get my train of thought ha? I have been sending myself in a ball of confusion trying to work it out or if its even a thing...

If people value the service, and you want a reasonable reception off of a dealer, the customer should pay you a fee. .

The difficulty is - what do you know? What do you bring? Why will people trust you?

If you can get people to pay you then crack on!

[Max Branning 149]

For bread and butter stuff this wont work, no one is going to pay you to find them a ford focus. It is just too easy to go online and find it yourself.

If you are looking at the prestige or classic market then it may be viable, but you would really need to know your stuff and have contacts.

If i was buying a 200 grand ferrari why would i come to you? what can you offer me ?

[MattS 0]

32 minutes ago, Mojo121 said:

If people value the service, and you want a reasonable reception off of a dealer, the customer should pay you a fee. .

The difficulty is - what do you know? What do you bring? Why will people trust you?

If you can get people to pay you then crack on!

could not agree more with the questions you asked, if I was a customer thats exactly what I would be thinking..

what I am looking for through this thread is the how can I explain "transition of sale" from, me either finding a car or advertising a car with a finance example (still haven't got round how you would do that)  all the way through to seller -> broker -> dealer -> car delivered to customer! 

I do not mean to sound ignorant or rude or abrupt when I say this but I would not really want to disclose the reasons I would be different from other dealers on a dealer forum if you get me? 

thanks for the replies guys, keep going.

Matt

17 minutes ago, Max Branning said:

For bread and butter stuff this wont work, no one is going to pay you to find them a ford focus. It is just too easy to go online and find it yourself.

If you are looking at the prestige or classic market then it may be viable, but you would really need to know your stuff and have contacts.

If i was buying a 200 grand ferrari why would i come to you? what can you offer me ?

Thanks Max,

Yes this was what I was thinking the bread and butter market requires a lot of work and small margins, Im not expecting mega money from sales but enough to make it worth it. Prestige cars is something I would like to go into, contacts and relationships are something i'm going to get into, like that saying Rome wasn't built in a day, I am realistic at times

thanks for the questions, adding them to the list of things to work out.

[Mojo121 229]

1 hour ago, MattS said:

 

what I am looking for through this thread is the how can I explain "transition of sale" from, me either finding a car or advertising a car with a finance example (still haven't got round how you would do that)  all the way through to seller -> broker -> dealer -> car delivered to customer

 

You're thinking about it in the wrong way. The value in a service like this is finding a customer which a specific need who hasn't got the knowledge, doesn't have time or doesn't trust dealers  - that's who you advertise to and you use those three cruxes to create advertising campaigns with. You wait for someone to bite. Then, you spend time with them on the phone or in person, and get a really thorough spec. You have to really understand and like PEOPLE. You then take a 50% retainer fee promising a shortlist of cars, refundable if you don't deliver. You do your searching and ping them the list over. Then you visit the dealer to do a deal. You never handle any of their money, they bank transfer it directly over to the dealer or you email them the finance forms to fill in.

So, the advantage you have is dealers take guesses, we stock cars we THINK the public will like but some customers are very specific and have a specific 'needs', especially at the upper ends of the market. Your job, and the only way I see it works, is finding people with the need who also fall into one of the three categories I mentioned earlier. You must forget the idea of advertising specific cars that you like hoping for a buyer, we all do that already.

I'm probably going to get shot on here for replying but I did entertain this some thought the other day... I guess the fact I'm giving my thoughts away says alot though 

[MattS 0]

17 minutes ago, Mojo121 said:

You're thinking about it in the wrong way. The value in a service like this is finding a customer which a specific need who hasn't got the knowledge, doesn't have time or doesn't trust dealers  - that's who you advertise to and you use those three cruxes to create advertising campaigns with. You wait for someone to bite. Then, you spend time with them on the phone or in person, and get a really thorough spec. You have to really understand and like PEOPLE. You then take a 50% retainer fee promising a shortlist of cars, refundable if you don't deliver. You do your searching and ping them the list over. Then you visit the dealer to do a deal. You never handle any of their money, they bank transfer it directly over to the dealer or you email them the finance forms to fill in.

So, the advantage you have is dealers take guesses, we stock cars we THINK the public will like but some customers are very specific and have a specific 'needs', especially at the upper ends of the market. Your job, and the only way I see it works, is finding people with the need who also fall into one of the three categories I mentioned earlier. You must forget the idea of advertising specific cars that you like hoping for a buyer, we all do that already.

I'm probably going to get shot on here for replying but I did entertain this some thought the other day... I guess the fact I'm giving my thoughts away says alot though 

Mojo..

Genuinely thanks for the reply I haven't looked at it this way before.

Ill take this and put it with all the other information I have gathered.

Cheers Matt

[trade vet 704]

I am sorry,the bottom line is,you cannot be a successfull broker if you are not an ex dealer.You need to talk the language for a start,that takes years.You have to be able to get a better deal on swappers,finance,warranty and have contacts for better value aftercare/servicing etc.For doing that you should be able to charge a flat fee as you will get FA from the retailer as net margins are too low.You may be better off doing something else.

 

[Arfur Dealy 823]

8 hours ago, trade vet said:

I am sorry,the bottom line is,you cannot be a successfull broker if you are not an ex dealer.You need to talk the language for a start,that takes years.You have to be able to get a better deal on swappers,finance,warranty and have contacts for better value aftercare/servicing etc.For doing that you should be able to charge a flat fee as you will get FA from the retailer as net margins are too low.You may be better off doing something else.

 

Absolutely right. You have no experience or foundation to build your business on. If you had an existing business and wanted to push towards sourcing that would be possible. But, who is going to trust you.....

[BHM 994]

Matt, turn the tables on yourself and have a think as though you're a potential customer. 

Why would someone looking for a car come to you to find it? The internet's a powerful tool that is available even to someone living in a mud hut in the middle of Outer Mongolia, never mind punters in the U.K.

No one buying cheap bangers or run of the mill cars has a use for this service and more importantly for you, if you even managed to source cheap new cars through the dealer network (highly unlikely) then the profit isn't there for you. 

As for high end motors, lets say Porsche/Ferrari. Why would a prospective purchaser come to you rather than a dealer? and good luck getting a discount there.

Then as you'll only be taking a deposit how are YOU going to finance these new(ish) cars to get them from your supplier to the customer? If you're expecting to get a sale or return deal then you don't know this game very well. 

Finally, (and I'm making an assumption here) if you haven't had experience of the general public & how they behave regarding money then you're in for an awful surprise - they'll fuck you around until the cows come home UNTIL it's time to show some financial commitment and it's that time that sorts the wheat from the chaff. Even assuming all of the above paragraphs fall into place for you then you've got this paragraph to deal with!

Honestly Matt, save your time & redundancy money. Go & buy a few from the auction & then you'll get some real experience in this game from purchase through to sale because believe me, there's plenty inbetween 'the purchase' to 'the sale' that anyone new to this game really doesn't appreciate.

Edited August 12, 2017 by BHM

[justina3 518]

I am still very confused under what conditions would i pay someone to go buy a car for me, ok maybe if i was an A list celeb i wouldnt want to do anything mundane like go car shopping but do they not have agents or pa's that take care of those kind of things.

But good luck if you think you spotted a gap in the market go for it, its only money

[MattS 0]

16 hours ago, trade vet said:

I am sorry,the bottom line is,you cannot be a successfull broker if you are not an ex dealer.You need to talk the language for a start,that takes years.You have to be able to get a better deal on swappers,finance,warranty and have contacts for better value aftercare/servicing etc.For doing that you should be able to charge a flat fee as you will get FA from the retailer as net margins are too low.You may be better off doing something else.

 

Honestly,

thanks for the reply I can appreciate the honesty, 

so out of curiosity? how are these car leasing companies offering lease deals and pop i.e 500 down 330pm on half decent cars making money?

 

cheers Matt

49 minutes ago, justina3 said:

I am still very confused under what conditions would i pay someone to go buy a car for me, ok maybe if i was an A list celeb i wouldnt want to do anything mundane like go car shopping but do they not have agents or pa's that take care of those kind of things.

But good luck if you think you spotted a gap in the market go for it, its only money

Honestly,

thanks for the reply I can appreciate the honesty, 

same question to you 

so out of curiosity? how are these car leasing companies offering lease deals and pop i.e 500 down 330pm on half decent cars making money?

cheers Matt

3 hours ago, BHM said:

Matt, turn the tables on yourself and have a think as though you're a potential customer. 

Why would someone looking for a car come to you to find it? The internet's a powerful tool that is available even to someone living in a mud hut in the middle of Outer Mongolia, never mind punters in the U.K.

No one buying cheap bangers or run of the mill cars has a use for this service and more importantly for you, if you even managed to source cheap new cars through the dealer network (highly unlikely) then the profit isn't there for you. 

As for high end motors, lets say Porsche/Ferrari. Why would a prospective purchaser come to you rather than a dealer? and good luck getting a discount there.

Then as you'll only be taking a deposit how are YOU going to finance these new(ish) cars to get them from your supplier to the customer? If you're expecting to get a sale or return deal then you don't know this game very well. 

Finally, (and I'm making an assumption here) if you haven't had experience of the general public & how they behave regarding money then you're in for an awful surprise - they'll fuck you around until the cows come home UNTIL it's time to show some financial commitment and it's that time that sorts the wheat from the chaff. Even assuming all of the above paragraphs fall into place for you then you've got this paragraph to deal with!

Honestly Matt, save your time & redundancy money. Go & buy a few from the auction & then you'll get some real experience in this game from purchase through to sale because believe me, there's plenty inbetween 'the purchase' to 'the sale' that anyone new to this game really doesn't appreciate.

HI mate,

thanks for the comprehensive reply its really appreciated,

like I said I'm trying to do all the digging and info finding I can before I make a decision on wether this is for me or not

from this forum I'm really just taking all the information I can get and putting it all together to see how it works from source to sale and see if there is a way I can be a little bit different which is going to be deal breaker. 

I'm sat in a fairly lucky position at the moment to have a few months to consider it

Cheers Matt

[MattS 0]

5 minutes ago, tradex said:

"so out of curiosity? how are these car leasing companies offering lease deals and pop i.e 500 down 330pm on half decent cars making money?"

Honestly, if you need to ask you have the mother of all learning curves....or to be blunt you haven't got a clue how this industry works...not to say you won't learn, we all started knowing sweet FA.

Please don't use your redundancy pay to enter the business, it will end in tears.

Your right, I agree myself.

Im not sure if you've ever been made redundant but this is my second time, however when your hobby is finding cars for your mates and trying to get them the best deal possible, you have a strong network of people around you for example 2 friends that are a mechanic, 1 an account, and 2 salesmen, I'm taking this learning curve with a pinch of salt but I am sick of working for other people and want to be my own boss, my idea is just turning something I enjoy doing into a business.

Cheers Matt

 

[trade vet 704]

Ok then Matts,what is the best deal you have done so far.How did you do it,how much did it cost you to do it and how much did you get paid !

[MattS 0]

3 minutes ago, trade vet said:

Ok then Matts,what is the best deal you have done so far.How did you do it,how much did it cost you to do it and how much did you get paid !

Sorry trade vet, I'm not sure I have pitched this over to you correctly, I'm not currently a broker or sell cars, bottom line is just someone with a interest looking for a new career, looking for info about how it works, whats needed, how things work etc, apologies if I have came across as something else. Im at that point where Ive never sold a car for profit in my life, everyone was there at one point weren't they?

my next step get into touch with some dealers, workshop owners I know try and get some info from them, but thought id start on this forum

Thanks Matt

[whitestone679231 113]

I have been learning this job for 35 years and one thing I will never do is source a car for a private if I am not prepared to end up owning it myself, something I learnt many years ago when a "customer" wanted a red Porsche 924, at the time they were at a premium, the guy made all the right noises money waiting definite buyer etc etc, obviously no one was going to lend me one so after giving him full details of one I had located I bought it on his say so,,, go to deliver it to him and his wife says........ wrong shade of red,,,,, Guards Red is Guards Red..... Never again.....

 

[trade vet 704]

7 minutes ago, whitestone679231 said:

I have been learning this job for 35 years and one thing I will never do is source a car for a private if I am not prepared to end up owning it myself, something I learnt many years ago when a "customer" wanted a red Porsche 924, at the time they were at a premium, the guy made all the right noises money waiting definite buyer etc etc, obviously no one was going to lend me one so after giving him full details of one I had located I bought it on his say so,,, go to deliver it to him and his wife says........ wrong shade of red,,,,, Guards Red is Guards Red..... Never again.....

 

That is just typical of our job,we have all had a bit of that ! Take note Matts.

[metcars 397]

Just out of interest, with a 'brokering deal' who takes responsibility if there are issues down the line. Can the broker sidestep any responsibilities? Are warranties given? Who does the inspections and are they insured against the usual? If that 'Ferrari GTO' turns out to not be a matching numbers car who is liable? Vendor, broker, inspection agent, warranty?

I was also under the impression that 'brokers' tend to operate in the upper price levels of classic cars/boats/planes

Edited August 12, 2017 by metcars

[BHM 994]

40 minutes ago, whitestone679231 said:

I have been learning this job for 35 years and one thing I will never do is source a car for a private if I am not prepared to end up owning it myself, something I learnt many years ago when a "customer" wanted a red Porsche 924, at the time they were at a premium, the guy made all the right noises money waiting definite buyer etc etc, obviously no one was going to lend me one so after giving him full details of one I had located I bought it on his say so,,, go to deliver it to him and his wife says........ wrong shade of red,,,,, Guards Red is Guards Red..... Never again.....

 

I have never & will never source a car for anyone, if it's something I'd buy anyhow then I've bought one & one the few occasions I've offered it it has never been what they wanted - they ALWAYS want something else OR they then check their insurance with the inevitable result. 

2 tales;

I once suggested (to a reasonably wealthy friend wanting a daughter's first car in the £3K range) that he gives me a list of MUST HAVES and MUST NOT HAVES, I'd tell him the maximum price, he'd then have to take the car or he would forfeit the deposit - which I said would be £500. This is a man who is NOT tight-fisted, who I've looked after his home when he was earning big bucks abroad, throws me the keys to his expensive car, we drink together, known each other for decades but when it came to the subject of a non-refundable £500 deposit you'd of thought I'd threatened to rape his daughter. 

A V70 D5 I bought & advertised normally. A flurry of interest. One chap says he definitely wants it cos it's bright red. I answer it's shiny but I'd describe it as a wine red. Anyhow, I confirmed the colour name to this Volvo "expert" (if memory serves it was something like Ruby Red Metallic) and even gave him the colour code. The old chap drives 200 miles to be with me by 9am on the Saturday morning. He sits for a few seconds clearly "having words" with his wife and gets out with a face like thunder - clearly he's not happy. To cut a VERY long story short, we get into an argument over the colour & eventually he gets his copy of the advert that he'd printed. LO & BEHOLD!! HIS PRINTER WAS FAULTY & MY RUBY RED CAR APPEARED BRIGHT RED WITH A BLUE HALO AROUND IT & BROWN TYRES!!!!

When he still continued to chew-on (about 15 minutes of me being polite in deference to his age) I showed him the advert on my phone and eventually had to point out that "NONE OF MY CARS COME WITH A BLUE HALO & BROWN TYRES. YOU ARE WRONG, IT'S YOU WHO'S FUCKED UP NOT ME". I pressed his Mrs. for an answer, laughed in his face & told him to leave.

So Matt, if you REALLY fancy risking your redundancy go for it. But honestly, please DON'T.

[justina3 518]

Leasing companies offering Fiat 500 as per your example is a totally different business module to what i understand car brokering to be, or again i might have misunderstood what your trying to do.

 

[williamblackshaw 43]

Not being rude and admire someone trying to do something, but the best deal for a customer and dealer is direct between them, a broker will take a margin from somewhere, I hate to say it but think your barking up the wrong tree.  If you like the idea of brokering, become a salesman and have the luxery of someone providing you with stock, a desk and a database  You will make a lot more money this way and have some colleagues to enjoy beers with.

[trade vet 704]

As they say on Dragens Den ..........I'm out !

[justina3 518]

1 hour ago, whitestone679231 said:

I have been learning this job for 35 years and one thing I will never do is source a car for a private if I am not prepared to end up owning it myself, something I learnt many years ago when a "customer" wanted a red Porsche 924, at the time they were at a premium, the guy made all the right noises money waiting definite buyer etc etc, obviously no one was going to lend me one so after giving him full details of one I had located I bought it on his say so,,, go to deliver it to him and his wife says........ wrong shade of red,,,,, Guards Red is Guards Red..... Never again.....

 

Maybe he wanted the faded pink shade of red...what ever floats your boat

 

[Max Branning 149]

Do you not fancy actually dealing in cars yourself?

If you have contacts as in mechanic friends etc and also you have a pot of cash to get started then i would of thought it makes sense to just take the plunge and start dealing. Brokering i cannot see any sustainable income from, unless as i said earlier you are offering a service to certain groups of people. To get to that level i would think could take years, where as starting out as a dealer could be profitable almost instantly.