How to Start An Automobile Dealership Business in India

The automobile dealership is one of India’s highest-value businesses, but it also needs a good investment. India is one of the biggest marketplaces of automobiles, and almost all two-wheeler brands are present in India. From the European companies of the best to the Japanese and Chinese companies of the east. A Two-wheeler dealership is a trendy business, and people opt for this business because it can escalate the investment very fast, and the ROI is also very high. So let’s get started with insights into this business and learn everything about it. 

Every big business has some steps and a specific growth pattern, and it becomes big if you follow the steps with pure dedication. Suppose we want to understand an industry; we need to understand the steps first and then move on to the next step. Let’s crack these business guides down and understand the whole process thoroughly with small and easy steps. 

1. Understand The Market Potential:-

The two-wheeler market has almost doubled in size in the past 5 years. As a result, the country has become the biggest marketplace of the two-wheeler segment. All the big worldwide brands are currently working in the country, and most are manufacturing bikes here. Right now, this sector is on a boom, and you can easily be a part of this. Recently, the 75-110 cc segment has also gained a lot and opened ways for new entrepreneurs to enter the game. 

2. The Game of Initial Investment:-

The initial investment is always crucial in starting a new business because you do not know how much you need. For that, you need to understand the mathematics of estimate and cost, which can give you an approximation for the initial investment. Depending on the business width, you need at least an investment of 80 Lakhs to 1.5 crores. If you need to rent or buy a place, design it according to the brand of which you are taking dealerships. If you are taking a dealership of honda new bike, you need to put pictures and wallpaper of that brand. 

After this, you need to create a service centre for the bikes, which will be your entity too. This service centre will need all the certified tools, all the standard parts and lubricants of the company. You must complete all of these things on high priority. The most significant expense will be the vehicles you buy for the showroom. 

3. Business Model:- 

When you start a business related to automobiles, choosing suitable business models becomes essential. There are 3 ways in this business by which you can target the market for your business. 

The first is the dealer point, which needs a lot of investment, as we have discussed for the showroom and service centre. With a lot of money, you also need adequate space for the showroom and service centre to be operated. You can rent a building with a basement in which you can start a service centre. 

The second way of starting this business is ASSC( Authorised Showroom & Service Centre). In this way, you need less money to establish the showroom and service place. 

The third one is a sales representative under a dealer, and you have to sell bikes to people with getting a commission on the bikes. In this, the earnings will be less, like the investment. 

4. Dealership Model:- 

The dealership model connects directly to the OEM and gets vehicles from them. This way, you can create a good relationship with the company. Like you can take a dealership of the yamaha new bike and sell them in your showroom. 

You need to follow some simple steps to get dealerships from the brands. First, you need to open the website and then click on the application for the dealership page. Next, fill in all the details about the name, Contact details, Email, Location and other details. After that, the brand will reply to you back. 

5. Business Plan and Model:- 

The Business plan or the blueprint is essential. It would help if you had a road map on which you could go for a long time. The business plan consists the marketing sales and all the other things. The main work of the dealership is to give customers priority, and for that, you can put canopies and awareness so that people will start knowing you. The location of the showroom and service is critical because you need to be recognized and easy to access for customers. If the service centre and the showroom are established in the same place, that is the best thing. Both of these things should be under a 50-metre of radius. 

6. Registration and Licence:-

The automobile dealership business needs a licence to register for that, and you need to register. You can be an LLP or Pvt. Ltd.

After getting registered, you need to get a trader licence from the municipal commission. You also need to get a GSTIN number from the tax department and a current account number from the bank. These are some of the necessary things you need to get on priority. 

7. Setup the Store and get Bikes:-

Now it’s time to start the engine of your showroom. Until now, you will get the bikes and scooters, and the wallpapers and pictures will also be there. Next, you need to customise the whole showroom and service the way the company needs. For example, it would help if you decided what the entrance looks like and how the overall showroom will look. Finally, you need to paint the whole space as part of this brand you are taking to the dealership. This work is the last and ultimate point where you are ready to sell your first vehicle. 

8. Software and Resources:-

Most of the time, the companies will provide you with the software they use to track sales and parts. This online portal establishes a bond between you and the OEM; with this, you can order parts and other things.

Manpower or mechanics and salesperson are essential aspects of this business, and you need to get this right. 

The automobile dealership business has gained popularity because of increased sales. And in the upcoming years, there will be no slowdown, and many more entrepreneurs will be part of this business. These are the 8 steps you can follow to start an automobile dealership business and grow it. 

We hope that you find all the relevant information in the blog; if you want to get more information on these topics, be with us.

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