New trader looking for advice

[gfautomotive 0]

Hi all,

My wife and I are looking to start trading cars part time. I am a full time employed Project Engineer and my wife is self employed operating her own established business from home. Cars have always been a passion for us both and our circumstances now mean we may be able to try our hand at buying and selling on a relatively small scale. I did my apprenticeship many years ago as a car mechanic and HGV fitter and my wife runs a successful small business from home so we feel it is worth a shot for both of us as an avenue for potential extra income.

Now as far as starting trading goes, I would like to ask what it is specifically that we should ensure we have before we start trading as I want everything to be above board and legal. So far I have the list of the following to cover:

Motor Trade Insurance - I have already received what I feel is a competitive quote for fully comprehensive cover, including business use for my wife's other business.

Trade Plates - Are these a specific requirement for traders or can individual vehicles be taxed in the interim?

Warranty - Do we have to offer warranty on sales vehicles, especially if they are sub £1000 run arounds?

Local Authority - We plan on using our home as our base trading 2-3 cars per month in a ideal world and not looking at big value sales. Do we need to register with the LA specifically?

Buying and sourcing - We plan to use local car auctions, eBay, gumtree and even Facebook to source vehicles for sale until we establish ourselves.

Advertising and sales - Auto trader, eBay, Facebook, and possibly our own website and Facebook page in future.

My main concerns at the moment are really over the trade plates and as to whether they are a necessity as we start buying maybe 1 or 2 cars in our first month. I will be looking to source locally to us and try quick flips to get into the swing of things. Also I am concerned about whether we need to offer a warranty on vehicles sub £1000 sale price or whether the terms sold as seen.

Any help and advice would be greatly appreciated.

Dan

 

Apologies I have just noticed this should be in the FAQ forum. Can this be moved accordingly?

 

Edited March 4, 2016 by gfautomotive

[Gavin@Rousdon 137]

You will need Trade Plates to drive the cars from auction.

No car can be sold to the public sold as seen, putting it on an invoice makes no different. They are protected buy law and it is expected that the car will be roadworthy and fit for purpose. You could be liable for faults for upto 7 years in law, but in the first 6 months it is for you to prove the fault wasn't on the car when you sold it. 

Good look in the sub £1000 market, its not a nice place to be i'm afraid

[gfautomotive 0]

7 hours ago, Gavin@Rousdon said:

You will need Trade Plates to drive the cars from auction.

No car can be sold to the public sold as seen, putting it on an invoice makes no different. They are protected buy law and it is expected that the car will be roadworthy and fit for purpose. You could be liable for faults for upto 7 years in law, but in the first 6 months it is for you to prove the fault wasn't on the car when you sold it. 

Good look in the sub £1000 market, its not a nice place to be i'm afraid

Many thanks for the reply. 

With regards to trade plates, if I buy from private sellers, not auction can I tax them using the online DVLA system temporarily until the vehicle is sold and drove without trade plates? 

I understand now that warranty is given in law and plan to at least conduct a pre sale checklist/defect list of there is any damage faults to the vehicle such as dents/scratches and be as honey as possible with my sales. 

Do you feel the sun £1000 market is barking up the wrong tree as a start up venture as the way I see it, there will always be customers wanting a decent no frills run around?

Thanks

[Gavin@Rousdon 137]

Plenty of people wanting £1000 cars but 1 major fault could wipe out your profit. Some buyers won't car that the central locking doesn't work, yet other will be on the phone the next day. Oil leak on a 206, needs a new head gasket, not a big job but still a £250 bill. 

You say your wife runs a well established business from home, I'm afraid certain people who buy £1000 cars would turn up and hassle her. 

Nothing stopping you from taxing cars, but unless you register then in your name you won't get the tax back.

I started out 15 years ago selling sub £1000 cars, I was lucky and had a workshop. Times were different then, if you don't believe me spend £500 on a Peugeot 206 and then track down an old K10 Nissan Mirca (G reg or H reg). Put both cars side by side and count how many more parts the 206 has on it. 

[gfautomotive 0]

1 hour ago, Gavin@Rousdon said:

Plenty of people wanting £1000 cars but 1 major fault could wipe out your profit. Some buyers won't car that the central locking doesn't work, yet other will be on the phone the next day. Oil leak on a 206, needs a new head gasket, not a big job but still a £250 bill. 

You say your wife runs a well established business from home, I'm afraid certain people who buy £1000 cars would turn up and hassle her. 

Nothing stopping you from taxing cars, but unless you register then in your name you won't get the tax back.

I started out 15 years ago selling sub £1000 cars, I was lucky and had a workshop. Times were different then, if you don't believe me spend £500 on a Peugeot 206 and then track down an old K10 Nissan Mirca (G reg or H reg). Put both cars side by side and count how many more parts the 206 has on it. 

Really appreciate the input, it this kind of information we need to take into account. We would be based from home as we have an established office and my wife's business which is run from home. I would intend to try and conduct sales with customers at prearranged locations such as a friends garage to establish a centralised meeting point/location.

I appreciate that any problems could well be a wipe out on profit margin for sub £1000 cars. I feel that given my experience, I would be able to source decent cars for the money and turn the sales around with my mechanic on hand to attend to issues or advise accordingly if I am unsure.

I think really the only way to go is to get set up and get going really and see how we fare. I am willing to give it a go and give it 12 months to see how we fare.

[Rory RSC 596]

Meet at a pre arranged meeting point such as a friends garage?

if you were a buyer and someone wanted to meet you at the local 24hr garage/ asda car park/etc how would that make you feel ?

 

people at £1000 are so much worse than customers at 5-6k.

they buy a £750 banger and that is literally all their money they have no other money towards fixing it even if it is a cheap example of a 187,000 car if something isn't working they will be back and moaning. 

[gfautomotive 0]

8 hours ago, RS Car Sales said:

Meet at a pre arranged meeting point such as a friends garage?

if you were a buyer and someone wanted to meet you at the local 24hr garage/ asda car park/etc how would that make you feel ?

 

people at £1000 are so much worse than customers at 5-6k.

they buy a £750 banger and that is literally all their money they have no other money towards fixing it even if it is a cheap example of a 187,000 car if something isn't working they will be back and moaning. 

Well if sales were conducted at a garage forecourt I would assume that a customer would be relatively happy to meet there, especially seen as my mechanic who owns the garage would be the one doing the pre-vehicle check and repairs. I guess its worth giving it a go and see how we fare.