How to Setup an Auto Leasing Company
One of the major reasons that scares away investors from putting their money into auto leasing industry is the unfriendliness of the market. The rules and regulations are not welcoming or do not give investors the incentive of venturing into the market.
To set a car leasing company is a long delaying process that consumes a lot of energy and resources, you are required to apply for the minimum license as per the state, after complying with the regulations you have to source funds to set it up then build a strong customer base. The time consumed in entering the market may delay you so much making you enter the market when there is less liquidity leading to losses or slow momentum, the capital required may be too high and there may be very stiff competition for you to penetrate the market. Motor vehicle leasing companies offer a lot of services and products both for consumer and commercial purposes, they also offer new and used cars for purchases, fleet management plus short and long term leasing.
These are the steps that you will follow to start your own auto leasing company.
- Draw a good business plan. Before you start making plans of applying for your operation license you need to write and document a good business plan that will contain the name of your company, location, contact address, services that you will offer, your target market and your marketing and promotional techniques. You will also be required to state your area of specialization, a good business plan is important because it will also help you to source for funds easily from any financial institution.
- Find a strategic location. The place that your company will be situated will matter so much, you must look for a place that is easily accessible, near a mass of people, safe place free from crime and near people with substantial amount of income. The premises need to look professional so that you create a good impression with your customers and attract more of them.
- Get certified. Apply for a state license with your local motor vehicle department, make sure that you have met all the minimum requirements, done every test and have paid the license fee.
- Acquire vehicles. You cannot start auto leasing company without having vehicles, search for fleet managers and keep in mind to shop for the best deals so that you save extra cash and reduce the cost of starting up the business. To give you an edge over your competition look for the cars that will meet the demands of your target market based on price or taste and preference.
- Determine and set your leasing rates. Based on the value of the cars that you have set the short and long term leasing rates. However, you must first set a price that is accepted by the leasing industry and also compare what your competition is offering so that you do not overcharge or undercharge your customers.
References:
- Leasing of car private (DK:leasing af bil privat)
- Advantages to private leasing car (DK:guide til privat leasing bil)
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