Auto Brokerage - With Innovative Approach For Sale - Los Angeles Area

This innovative web based auto brokerage has developed a multi-faceted simple, convenient and cost effective method for selling and leasing autos that customers, dealers and financing partners have embraced. The business, which operates out of a non-descript office complex, could be readily expanded or relocated with minimal operational impact. The firm's sales persons are independent contractors with basic auto industry knowledge, whereas it's many satisfied clients are derived from two independent sources. Clients who wish to lease new autos (approximately 40% of the business) come directly from the company's web presence and customer referrals, while the company has developed a unique market niche to be the de facto preferred new and used auto sales provider (60% of the business). In 2016 the company sold or leased 1,237 autos and wholesaled an additional 97 that were used car trade ins. Of the 1,237 autos, roughly 742 were sold (445 new; 297 used) and 495 were new vehicle leases. The company's boasts commission agreements with nearly 250 dealerships throughout California that provide its customers a varied vehicle selection.

The web based leasing company caters to clients who want to obtain no hassle bottom-line pricing without the stress of car salespersons and dealerships. This firm attracts local buyers who are happy to take the typical car dealer games and lease rate negotiations out of the equation, but could also target buyers in any geography as the autos are delivered to their homes!

Pre-negotiated lease and sales rates with preferred dealerships allow the company to sell and lease for below the dealers stated cost. Dealers and other partners are pleased to gain the volume of business moved (approximately 100 vehicles per month). For leasing, the business's software allows it to determine the best lease pricing using the most current bank rates while its website attracts clients and sets their mind at ease and enticing them to move forward (its customer service agents assist customers in selecting a car and complete leases as necessary).

This web based business operates out of a 1,500 square foot office that has one assistant manager and 5 independent contractor customer service / sales agents. Another 4 sales agents are located at the company's credit union partners. The office leases for $3,297 per month on a lease with two years remaining, however, the company is not location specific and may be relocated. The business requires $50,000 in working capital that is not included in the sale.

There are a few very large competitors in each segment of the business. These competitors do not tend to take an aggressive sales approach with closing deals, as they have become somewhat complacent. From the web based brokerage perspective, several competitors exist on different levels (e.g. True Car, Cars Direct, Auto Land, Auto Experts), but few offer the same value proposition or level of customer service. This business offers bottom line MSRP plus pricing, charges a small brokerage fee that is only due from the client when a lease is completed and is able to deliver autos to the client's home or office without dealership involvement or last minute dealer up sells.

This company has several avenues for potential growth, including 1. Expanding the office size; it is still relatively new and only has 5 office salespersons and 1 assistant manager; 2. Licensing / franchising the concept as the business model has proven successful in alternate test markets, or most likely, with additional financing partners; 3. Increasing lease prices to generate higher net revenues per transaction, 4. Bolstering advertising on additional auto related sites for a deeper market penetration, or targeting a larger geography than they currently target; 5. Engaging in search engine optimization or pay per click programs, 6. Hiring a public relations firm to generate more indirect interest, or 7. Leveraging their web presence, market knowledge and dealer relationships to formulate more extensive new car purchase programs that are as attractive as their lease programs!

Training:2 Weeks at 20 hrs/wk