I. Executive Summary
This Section's Contents
You can download our Car Dealership Business Plan Template (including a full, customizable financial model) to your computer here.
Business Overview
[Company Name], located at [insert location here] is a brand new GMC dealership that sells, leases, and services new and used vehicles to customers in the surrounding community. Our dealership will feature a range of vehicles, from budget cars to vehicles that fit nicely with the aspirational tastes and preferences of the local area – young, middle class suburbanites want attractive, high quality vehicles, but do not want to pay high prices for them.
Products and Services
[Company Name] will maintain an inventory of new and used GMC vehicles. Services will include routine maintenance, as well as parts and repairs.
In addition, [Company name] will also offer financing and insurance options for customers with all credit scores. Customers will find financing options at [Company name] that they will not find at other area dealerships.
Customer Focus
[Company Name] will primarily serve the residents within a 30 mile radius of our location. The demographics of these customers are as follows:
- 27,827 residents
- Average income of $74,700
- 58.9% with higher education
- 49.6% in Mgt./Professional occupations
- Median age: 35 years
This bodes well for [Company Name], as the prime demographic for dealerships are consumers with prime and super prime credit ratings, which is typically correlated to income. In addition, there is growing demand for maintenance and repair services, as consumers have recently opted to maintain rather than upgrade their vehicles. Individuals of all ages will be sure to patronize [Company Name] for both vehicle purchasing and vehicle maintenance/repair.
Management Team
[Company Name]is led by [Founder’s Name] who has been in sales for 20 years. While [Founder] has never run a dealership himself, he has worked in the industry since age 30. As such [Founder] has an in-depth knowledge of the dealerships industry, including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.).
Success Factors
[Company Name] is uniquely qualified to succeed due to the following reasons:
- The Company will fill a specific market niche in the growing community we are entering. In addition, we have surveyed the local population and received extremely positive feedback saying that they explicitly want to frequent our business when it is launched.
- Our location is in a high-volume area with easy access from multiple residential and commercial district zones.
- The management team has a track record of success in the dealerships industry.
- Auto dealerships are a proven business and have succeeded in communities throughout the United States.
- Local competitors leave a large gap in the market—there are dealerships offering used cars and maintenance services, and a dealership that exclusively sells electric vehicles, but nothing that encompasses both new and used autos (internal combustion, hybrid, and fully electric), as well as a service department.
Financial Highlights
[Company Name] is currently seeking $10 million to launch. Specifically, these funds will be used as follows:
- Lot design/build: $100,000
- Franchise fee: $400,000
- Inventory: $9 million
- Working capital: $500,000 to pay for Marketing, salaries, and lease costs until [Company Name] reaches break-even
Topline projections over the next five years are as follows:
| Financial Summary | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Revenue | $400,000 | $466,067 | $524,563 | $590,400 | $664,500 |
| Total Expenses | $345,594 | $385,172 | $419,434 | $475,894 | $507,480 |
| EBITDA | $54,406 | $80,895 | $105,129 | $114,506 | $157,020 |
| Depreciation | $20,840 | $20,840 | $20,840 | $20,840 | $20,840 |
| EBIT | $33,566 | $60,055 | $84,289 | $93,666 | $136,180 |
| Interest | $16,822 | $14,719 | $12,617 | $10,514 | $8,411 |
| PreTax Income | $16,744 | $45,336 | $71,673 | $83,153 | $127,769 |
| Income Tax Expense | $0 | $0 | $17,104 | $29,103 | $44,719 |
| Net Income | $16,744 | $45,336 | $54,569 | $54,049 | $83,050 |
| Net Profit Margin | - | 10% | 10% | 9% | 12% |
