Automotive Business Plan: Four Steps to Success
Like other business plans, the content of a car dealership business plan covers four main steps to success. These steps are “opportunity”, “capacity”, “activities” and “results”.
Chance
The industry, customer, and competitor analysis in your business plan demonstrates the opportunity. This should identify that customers in your local market need a dealer of the type you have chosen because their needs are not fully met by competitors or because their demographics are changing (more populated, richer, poorer, more families, etc.) The Opportunity It could also be that a certain combination of services from your dealership could improve what competitors are currently doing. The general situation of the industry should look to the future, what the car sales market will be like in six months, a year or more, when the dealership is actually open.
Ability
The experience of the management team, their license as a car dealer, and the financial resources that the partners can bring to bear cover the entrepreneur’s ability to take advantage of this opportunity. Funders reading the business plan hope that there is also a cash element missing in the entrepreneur’s ability at this point. Otherwise, they wouldn’t be reading the plan in the first place.
Activities
Marketing and operations plans cover the activities the business will engage in to attract car buyers (and car sellers if it’s also a used car dealer) and run the business as efficiently as possible. As a small car dealer, consider how you can make up for this lack of scale, and the associated cost savings for dealer chains, through creativity and hard work.
Results
Finally, the business success projections and financial section of the plan show the results you and investors should expect. If the results take into account the full costs of the methods you’ve described and include adequate compensation for staff and key team players, readers will be less likely to question the cost elements. If your revenue projections are based on reasonable and researched assumptions about your local market’s car-buying behavior, readers are more likely to accept this side of the projections as well.
