New kid on the block

[Wayne_202 0]

Good morning, my name's Wayne I live in Devon. I've read loads on here and it's so helpfull so thought I would join.

I'm not in this to become a millionare in a week. It's just a bit of cash on the side and keeps the mind active. 

I'm a mechanic Monday to Friday at an independent. Then do a small amount of buyers and sellers on the evenings and weekends. 

I've done about 5 so far. All sold for around the £1000 Mark.  Mostly needed a little bit of work and an mot then price to sell and so far All but one I've sold for full asking price making £200-800 profit. I enjoy the whole valeting side to it, turning them from rough looking to mint condition looking. 

This market seems to be working for me but I would like to be investing more into it and doing slightly newer stuff ideally with the hope there maybe slightly more profit on average. I guess it's just having more money tied into it. I like the fact at the moment if I loose anything it's only going to be a few hundred. 

All the cars so far have been bought private as I live about an hour away from an auction.

I've got traders insurance now so can drive vehicles a bit more legal. 

Trading from home. All work done in my own garage at home. 

I'm not unrealistic in the past I've lost so much money on personal cars and I know I will soon buy a few lemons as it can't be helped in this day and age but I service all the cars before sale including it's break obviously and change any pads etc that will be needed in the next few thousand miles. This seems to give people piece of mind. 

Any advice in the future will be greatly appreciated.

[justlooking 48]

And apply for  trade plates, google them.

get some invoice an pdi pads and cover yourself by doing pdi on every car before you sell them and get customer to review and sign their acceptance, keep a copy. Find some lawgistics ones online.

[Jack Regan 116]

Stick to your mechanics mate , jobs shite ,

[trade vet 704]

Hi Wayne

Sounds to me like you are doing OK.If you are good at your day job,you will be earning £30k or more depending where you are.If you can then do 3 or 4 cheapies per month staying below the VAT threshold,that is good.There will be quite a few on here who would settle for that.Your USP is that you are a mechanic and punters will always buy cheapies from a mechanic.

[Dave2302 387]

TV is bang on the money, stay the feck away from the VAT, de registering when I sold my old firm and re located was my best move ever

What he says above is exactly what I do now.

Good luck to you

BTW it's BRAKES !!

Cheers Dave

[Wayne_202 0]

Please excuse my ignorance but what good what public liability insurance be? 

Yeah I won't be giving up the mechanics that's the breadwinner that covers the bills. I don't earn near 30k but I'm in the sticks where the wages are low but I don't have to travel far and am always home by 5. This venture is just for a holiday fund and make life a bit more comfortable. 

Its more so to keep the mind active and the entropenural spirit alive. 

I will look into the pdi pads. Currently no warranties are given but as selling from home I don't really get asked. This suits me although if something does go wrong I'm the sort of person to do all I can to help them out. 

Ideal scenario is some local customers will come back for repairs and servicing years down the line which will then eventually create a higher profit in private work and a loyal customer base.

Cheers Dave, brakes it is your correct. I must read my posts before I submit. hahaha

[justina3 518]

I am with tv all the way, stick to what your doing there is no more money in the newer stuff if anything you less, adding value as you is the key to making a decent profit once you start buying newer kit that apart from a wash and service that’s the only value you can add anyone can do that.

People often ask me about starting businesses ect and I reply the same every time be honest and work out your strengths and weakness and stick within them boundaries the grass may seem greener on the other side but once you get there you find it’s astra turf.

[Wayne_202 0]

I guess I was just thinking newer ones I would hopefully get less problems and more profit. But I suppose more people are doing that so not as many bargains to be had. 

I'm still early in the game so I've got loads to still learn and find exactly where my market is.  

Your advice is invaluable guys thankyou so much. Ordering some pdi pads now.

[Nick M.K. 574]

36 minutes ago, Wayne_202 said:

This venture is just for a holiday fund and make life a bit more comfortable. 

It can make your life a lot more UNcomfortable including when you are on holiday. When the phone rings about "that car you sold me" it's especially unpleasant if the call finds you on a beach somewhere :-)

The job these days is less about cars and more about people and what they want. Start with cheapies with big % margin. Also I would not tell those buyers that I am a mechanic as it could mean a comeback for a free repair on every little minor niggle. 

As Justin said adding value is key and you can add A TON of value to a £250 cheapie without trying to restore it to as new condition.

And Good luck! Sometimes this is all it boils down to. 

[Dave2302 387]

I have a work mobile and a "private" i.e. family and close friends only who have the number, I don't even take the "work" mobile in the house, let alone on holiday with me

Just stick an answerphone message on it "Currently away for xxxxxxxxx back on xxxxxxxxxx  

I found that the real cheapies just cost me as much as I could sell them for by the time I'd bought parts, 12 month MOT labour etc

My Sales model is this ..................... Buy something 2008 upwards, with clean bodywork, (I hate paintwork), but I buy "spares / repairs" stuff privately, normally Cars with electronic problems, and fit second hand modules etc, code stuff where necessary, fresh MOT and Valet, unusual if I don't earn at least a bag out of every one 

I fix them up when Workshop is quiet, so effectively I'm buying some work, first started that when I had the Transmission Firm, used to buy Cars from customers with a goosed auto box, who couldn't afford or didn't want to spend out to repair them

[Wayne_202 0]

2 hours ago, Dave2302 said:

I have a work mobile and a "private" i.e. family and close friends only who have the number, I don't even take the "work" mobile in the house, let alone on holiday with me

Just stick an answerphone message on it "Currently away for xxxxxxxxx back on xxxxxxxxxx  

I found that the real cheapies just cost me as much as I could sell them for by the time I'd bought parts, 12 month MOT labour etc

My Sales model is this ..................... Buy something 2008 upwards, with clean bodywork, (I hate paintwork), but I buy "spares / repairs" stuff privately, normally Cars with electronic problems, and fit second hand modules etc, code stuff where necessary, fresh MOT and Valet, unusual if I don't earn at least a bag out of every one 

I fix them up when Workshop is quiet, so effectively I'm buying some work, first started that when I had the Transmission Firm, used to buy Cars from customers with a goosed auto box, who couldn't afford or didn't want to spend out to repair them

This is exactly what I wanted to hear. 

[David Ayers 171]

If you tell a customer you are a mechanic then when something goes wrong months later you will get “You knew something was wrong when you sold it. You’re a mechanic!”

I’m not sure if it’s exactly public liability you need. I forget the correct term. But if you are fixing brakes for instance. Then you should have some insurance in place in case something happens and you get sued. A private person wouldn’t need this but you are a trader, as you are buying and selling cars for a profit.

I doubt very much that you will get a knock on the door from HMRC but be aware you should be declaring any profits.

[trade vet 704]

19 minutes ago, David Ayers said:

If you tell a customer you are a mechanic then when something goes wrong months later you will get “You knew something was wrong when you sold it. You’re a mechanic!”

I’m not sure if it’s exactly public liability you need. I forget the correct term. But if you are fixing brakes for instance. Then you should have some insurance in place in case something happens and you get sued. A private person wouldn’t need this but you are a trader, as you are buying and selling cars for a profit.

I doubt very much that you will get a knock on the door from HMRC but be aware you should be declaring any profits.

If Wayne has traders insurance cover surely that would include public liability cover.As regards volunteering he is a mechanic,I have to disagree.We employed an ex mechanic as a salesman,he was a straight talking no bullshit guy who would wear an overall with a few spanner’s in his top pocket.The punters loved him,he used to nick the swappers and do great chucky deals and when they returned for another car they used to ask for him.Even our Black Horse rep thought he was a star.Regarding HMRC,I agree Wayne definateley needs to record and declare everything,otherwise you can now be crucified .It is not like the old days.

 

[Wayne_202 0]

I am keeping All bills and sales receipts but don't really have a clue of how and when to declare things.  I'm not making enough to warrant paying an accountant to guide me at the moment. Still early days so I'm guessing I wasn't to see how many I can turn around etc first

[Dave2302 387]

13 hours ago, trade vet said:

Regarding HMRC

Hi, I record and declare everything it works in my favour, but if I get close to the 80k Turnover VAT threshold then I'd rather take a month Holiday off than go over it !!

Due to my low overheads, one man band, I doubt I ever will as I don't work 24 / 7 , plenty time for my own stuff and still make a decent wage

You want to buy everything you can in your first year Tools / Equipment wise, you are not expected to make a huge profit, you will only pay tax on that money if you do !!

I don't do discounted, would rather turn a job or sale away !!

When I buy parts for a Customers Car I simply price them at VAT'd price to me, plus 30% mark up.

In your first year trading, you don't register for on line Tax Account until you hit the 11 month mark, then just do self assessment and make sure you get it in with your payment by January deadline or you'll get fined !!

Your National Insurance payments as a Sole Trader can be made at the same time, and are a pittance compared to PAYE NI figures that you pay as as an employed person.

Don't know about England, but in Scotland Highlands Sole Traders pay zero Business Rates.

Claim for everything that is a Business expense, even just a packet of paper clips !! Do not claim Diesel etc for the wifes Car, just keep it straight and you'll be fine.

I don't pay an Accountant, but I did go see one after 3 months and paid him an hour to look at my books and make any suggestions that he saw, which he did.

Finally, look into what Grants you may be able to get as a new start up.

Now all ticks along nicely

HTH

Oh, and the best of luck to you, you should do well out of it, better than working for someone else and not having any freedom, low (piss taking) wages etc etc !!

You need the Public Liability BTW in case you sell a car and a week later something lets go and there is an accident, their Insurance co, officials etc will crucify you otherwise, it doesn't have to be the Billy that takes you to court, if it can be proved that something you did / sold was faulty and that cased the problem, i.e. ball joint lets go, car swerves and crashes into a que of ppl at a bus stop etc etc etc then you could be held accountable as you were the last person to work on it ............ Saw a good friend in the Gearbox game lose his house because of that very scenario, and RTA Trade Insurance does not always include Public Liability !!

[MattR 177]

Hi Wayne

If you can make some money selling the cheapies, stick with that price bracket. the higher the car value, the more likely you are to hit the VAT threshold, then kiss goodbye to 20% of what you just worked for. and its 20% of the difference between buying and selling price, not the actual profit after recon.

I sell from 2k upwards off a pitch, and it is diificult to make more than £500 on a 2k car after you take into costs such as recon, VAT etc (though you will have an advantage of doing things yourself that I have to pay for). I dont think you will make much more selling a car for 2k than for 1k and you will be up against higher expectations. A good car for a grand will always sell very quickly. 2 k plus and you will need to be more patient. 

[Tadams 29]

I've never really understood some of these posts "i'm doing this.. i'm enjoying this... i'm doing well with my profit BUT i want to change and do things differently" If what your doing currently works then why change if you don't have too ?

As covered above higher value cars don't always mean higher value profit, they do mean a more savvy customer, more expensive come backs and a harder sell.

[Dave2302 387]

1 hour ago, MattR said:

A good car for a grand will always sell very quickly.

 

26 minutes ago, Tadams said:

higher value cars don't always mean higher value profit, they do mean a more savvy customer, more expensive come backs and a harder sell.

/\ /\ /\ like.

Agreed, especially with a lot more competition in the Southern (to me) areas  

[Kieran @ Cazana 3]

Good luck with it all Wayne!

Where abouts in Devon are you to? Im Woolacombe/Ilfracombe 

[It's me 615]

trying to find good sub £1000 cars to retail all but disappeared when the great govt of the time introduced scrappage scheme

since then anything and everything really is hard to buy and better and retail and be worthwhile

so well done, but choose your clonkers carefully

[arslan2468 1]

I'm pretty much exactly like yourself, i started about a year ago now, brought a car from auction to sell but it didn't move at all after a good 3 months finally sold with a £200 profit i was really put off. i then started looking at cheaper cars from local sellers buying them doing any work required and selling for a profit of between £600-£1000 per car, I've made mistakes along the way and live and learn from them. still paying for some of the mistakes to this day lol. I did this whilst studying at university with a  part time job too. Now that I've graduated and started my training year working 39 hours a week I'm still doing this on the side. i genuinely do love and enjoy selling cars then my main career right now. This forum is actually fantastic can learn a lot from it and your a mechanic so that will 100% work in your favour too. Literally buy anything which is cheap from Facebook gumtree eBay, some advertise as spares but more than likely its really minor stuff, put a new MOT on it if needed a good clean and your good to go. after a bit you'll start to know what to focus on etc. start with sub £1000 then move up. At the end of the day profit margin is the same in most cars so rather have £500 in a car which will bring you £500 profit than £4500 which will also give you a £500 profit, 

hope that helps in a any way. 

[Row 71]

If the margin is the same on those 2 cars then the profit would be 2250 on that 4500 car, just saying.

[Nick M.K. 574]

17 hours ago, arslan2468 said:

At the end of the day profit margin is the same in most cars

Not at the end of my days. 

Shit cars have shit margins. Better cars have better margins. Some cars have HUGE HEALTHY JUICY margins. AND when you sell them on finance you get £££ added on top. 

8 hours ago, Row said:

If the margin is the same on those 2 cars then the profit would be 2250 on that 4500 car, just saying.

Rowland, I think he meant that the profit margin is always £500 (not the same %) but in one case £500 investment is tied up, in the other £4500 is tied up. 

[Rory RSC 596]

42 minutes ago, Nick M.K. said:

Not at the end of my days. 

Shit cars have shit margins. Better cars have better margins. Some cars have HUGE HEALTHY JUICY margins. AND when you sell them on finance you get £££ added on top. 

Rowland, I think he meant that the profit margin is always £500 (not the same %) but in one case £500 investment is tied up, in the other £4500 is tied up. 

You can get £4500 out of £34k RS3's  or you can make £500 -Depends on your buying on everything.

 

 

[Row 71]

Nick, yes I got that, just me being pedantic. :-)