Small independent used car lot

Local private buyers looking for affordable used vehicles, plus people trading in their old car. Some buyers need financing arranged.

The margin between what you pay for and recondition a vehicle and what you sell it for. Extra income can come from documentation fees (where allowed) and commission on financing or add-on products.

• Judging a vehicle's condition and value
• Negotiating and selling
• Paperwork and record keeping
• Basic cash flow management

• Dealer license, surety bond and lot or office requirements vary by state, so check with your state licensing office
• Garage liability and 'garagekeepers' insurance, plus coverage for inventory
• Title, odometer disclosure and the FTC Used Car Rule Buyers Guide, so check what applies to you
• Sales tax registration and how your state handles vehicle sales tax
• Cars you can't sell tie up cash, so buy carefully and avoid over-stocking
• Rules on in-house financing and lender partnerships, so check state and federal requirements

Estimates suggest startup costs are typically around $30,000 to $120,000, depending on your lot, how many vehicles you buy, bond and insurance, and reconditioning. Treat this as a rough guide, and avoid over-stocking since unsold cars tie up cash.

Estimated monthly revenue is typically around $15,000 to $70,000, depending on inventory, pricing and how quickly you sell. Estimates start from about 35 hours a week. Revenue is not profit, so account for vehicle and lot costs.

Check dealer license, surety bond and lot or office requirements with your state licensing office. Also check garage liability and inventory insurance, title, odometer disclosure and the FTC Used Car Rule Buyers Guide, sales tax rules, and financing requirements.