How To Be A Successful Car Dealer In Nigeria

Car dealership in Nigeria means buying automobiles from overseas at a cheap rate to sell at a profit in Nigeria. The buying sources vary, the most common being auction/bidding sites. Then there is the Cotonou market in the Republic of Benin, where cars from all over the world are imported there and sold at a very cheap price. In the dealership venture both used and new cars are sought after, you just have to weigh the demand for each specific car before buying them to resell.

Type of dealership you want to run: In Nigeria, two types of dealerships are available to you. You can either be a wholesaler or a retailer- this is largely dependent on your capital base. Wholesalers are those who buy cars in large numbers and sell to other wholesalers or retailers. You need a top-level  car dealership license to operate as a wholesaler in the car dealership business. Wholesale dealers have the advantage of buying cars at discounted prices directly from the manufacturers.

Retailers are those who sell cars directly to the public, in most instances, the price of cars at this level is usually more expensive. It’s up to you to decide which type of  dealership you want to run- whether be a wholesaler or a retailer.

Get a garage: You need a garage to display your cars for sale to potential clients and customers. In getting a garage, you need to be strategic- get a good plot of land at a befitting location where buyers can easily locate it. Make sure your garage is large enough. For security reasons, you can have CCTV cameras installed in showrooms and other locations in your garage to avoid theft.

Buy your cars:  Now that you are certified and you have a garage, you can proceed to buy your cars. Remember, you can either be a dealer in new and/or  used cars, the choice is yours to make.

Marketing and advertising: Advertising is very crucial to being a successful  car dealer in Nigeria. When doing your advertising and marketing, don’t forget to include your location, contact information, website, picture(s) of the car(s), and an honest description of the car.

Employ the needed number of staff: The number of staff you will require depends on how large your  car dealership business will be. If you are just starting out, one or two staff should be enough.

Starting a  used car  dealership, on the other hand, doesn’t require such a large initial investment, but the earning potential is lower. The profit margin for most  used cars is around N300k – N500k and price fluctuations are common.

For normal saloon cars after custom clearance and all the small fees that comes with bringing in a car into the country, you will make up to N500,000. SUV’s attract more as you could make up to 1million Naira or more from selling a single car. By which we could surmise the profit margin at about 30%, but as Nigeria uses the rising and falling of dollar to calculate the import tax, the margin might change dramatically in a heartbeat.

Choose the Right Location:  There are a couple of factors that come into play when choosing a location for your  car dealership . For starters, you’ll want to make sure the location you choose can support your business. The larger the population, the more sales you’ll make. Then there’s the location’s visibility to take into consideration. If your lot is on an obscure road or set back from the roadside, you’ll likely draw fewer customers.

Employ automobile repairer: It is a well-known fact that most cars are sold as second-hand or damaged vehicles bought from either insurance companies or custom auctions at giveaway prices. After purchasing the vehicles the smart dealers then refurbish them and present them as  used vehicles for resale. So when you employ these automobile repairs, they will help you recondition damaged cars for resale.

This business depends on your capital and space available at that moment. You can start with as little as 1-2 cars to as many as 30-50 cars. Even when it is a franchise, the size of the business may vary depending on the deal that was made with the company.

Stay Updated and Adapt: The automotive industry is dynamic, with new models, technologies, and market trends emerging regularly. Stay updated with the latest industry news, advancements, and customer preferences. Adapt your inventory and business strategies accordingly to stay competitive and meet the evolving demands of the market.

Set Up a Showroom and Workshop: Design an attractive and functional showroom that showcases your vehicles effectively. Create a welcoming and professional environment for customers. If you plan to offer maintenance and repair services, set up a workshop equipped with necessary tools and qualified technicians.

Provide Excellent Customer Service: Customer satisfaction is crucial for the success of your car dealership. Train your staff to provide exceptional customer service, including product knowledge, transparency, and responsiveness. Offer warranty options, after-sales services, and facilitate smooth and transparent transactions.

Becoming a car dealer in Nigeria requires careful planning, research, and execution. By following this comprehensive guide, you can establish a successful car dealership and capitalise on the thriving automotive industry in Nigeria. Remember to comply with legal requirements, build strong relationships with suppliers and customers, and provide exceptional customer service. With dedication, perseverance, and a strategic approach, you can carve a niche in the car dealership business and achieve long-term success.

Get our information on how to be a successful Car Dealer in Nigeria. The body of this work is formed from consulting experienced and relevant people running the Car Dealer Business, to get first-hand information about the success secrets and marketing strategies deployed to achieve business success.

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