How to Become a South Carolina Wholesale Car Dealer

Wholesale car dealers can opt for garages to store cars instead of car lots..

Wholesaler car dealers profit from a different customer base than regular commercial dealerships. In South Carolina they are not allowed to sell to the general public. They can only sell to licensed commercial dealerships or other licensed wholesalers. If you sell or plan on selling more than five cars in a single year, the state of South Carolina requires that you have a motor vehicle wholesaler license.

Things You'll Need

• Form DLA-1
• Form DLA-1B
• Surety Bond

Instructions

Organize Your Business

1. Pre-plan the Business by writing out your goals and strategies to make the business model successful. In "Entrepreneur's Great Big Book of Business Lists" Courtney Thurman and Ashlee Gardner write "Your ultimate power and most critical decision is where to allocate your resources. Your main resource is your time and money."

2. Find an office dedicated to your business. Wholesalers in South Carolina aren't required to run a car lot, but the state expects wholesale dealers to have a dedicated place of business. Find a garage to store vehicles you've bought for resale until they can be sold. To quality for dealer's license plates to put on the car, you must carry garage liability insurance.

3. Hire sales professionals to help with re-selling purchases to dealers. You can outsource the task on a commission basis to avoid the costs of full-time employment, paying benefits and worker's compensation insurance.

Get Licensed

1. Find an 8-hour pre-licensing course approved by the state. Attend pre-licensing course. Complete the course and recieve the certificate that confirms that you've complete the course. The DMV recommends finding classes through the Carolina Independent Automobile Dealer Association website.

2. Download the DLA-1 and DLA-1B forms from the South Carolina Motor Vehicle website. The South Carolina DMV says, "In this two-page application, you must indicate the type of business you intend to operate, the address of your dealership, and provide information regarding your employees." The application processing fee is $50.

3. If you have hired full-time employees, include their complete names, driver's license numbers and addresses on the back of the application.

4. Contact a bonding company and apply for a $30,000 surety bond. Fill out this information on the Form DLA-1B. This is the state's method of ensuring that you adhere to all applicable laws and codes. It also protects your customers from misrepresentation or fraud.

5. Include a copy of the signed surety bond and Power of Attorney documents along with your application. Pay the $50 application fee.

6. Submit your completed application. An agent will call you once your application has been processed. If you plan on opening a lot for dealers to visit, then you will have to schedule an inspection. Submit applications to:

   South Carolina Department of Motor Vehicles

   Dealer Licensing and Audit Unit

   Post Office Box 1498

   Blythewood, SC 29016-0023

   [phone]

References

• South Carolina Department of Motor Vehicles: Dealer Licenses
• Entrepreneur's great big book of business lists: all the things you need to; Courtney Thurman, Ashlee Gardner; 2006

Resources

• eBay Motors the Smart Way: Selling and Buying Cars, Trucks, Motorcycles; Joseph T. Sinclaire; 2004