Buying a car dealership is a major investment opportunity. Whether you’re expanding your current auto group, entering the industry for the first time, or diversifying your portfolio, owning a dealership can be highly profitable. But the process is complex—far more complicated than buying a typical business.
If you’re wondering how to buy a car dealership, the most important step you can take is to partner with an experienced car dealership broker. A brokerage firm ensures that you not only find the right dealership to buy but also navigate every stage of the acquisition process smoothly.
Here’s what you need to know about buying a dealership—and why having a broker by your side is the key to success.
Step 1: Define Your Investment Goals
Before you begin the search for a dealership, consider:
- What type of dealership do you want to own? (franchise vs. independent)
- What brands or manufacturers align with your investment goals?
- Do you want a single-location business or a multi-dealership group?
- Are you prepared to buy the real estate, or would you prefer a lease arrangement?
A car dealership broker can help refine your goals and match you with opportunities that fit your financial objectives and operational preferences.
Step 2: Find the Right Dealership Opportunities
Unlike other businesses, auto dealerships are rarely listed publicly. Confidentiality is critical to protect the seller, their employees, and the brand.
Brokers provide:
- Access to off-market listings not available to the public
- Connections with dealership owners who are ready to sell
- Targeted searches based on your location, brand, and investment goals
Without a broker, you risk missing out on the most profitable opportunities.
Step 3: Secure Financing and Understand Valuation
Buying a car dealership involves multiple financial components, including:
- Inventory valuation (new and used vehicles)
- Parts and service department value
- Blue sky value (goodwill of the dealership)
- Real estate or lease agreements
A dealership broker will:
- Provide a comprehensive valuation report so you know what the dealership is truly worth
- Connect you with financing partners who understand automotive acquisitions
- Ensure you don’t overpay for goodwill or undervalue hidden assets
Step 4: Navigate Manufacturer Approval
If you are buying a franchised dealership (Chevrolet, Toyota, Ford, etc.), the manufacturer must approve the buyer. This can be one of the most challenging parts of the process.
Your broker will:
- Prepare your buyer profile for manufacturer approval
- Communicate directly with the OEM (Original Equipment Manufacturer)
- Guide you through requirements, such as financial strength and operational experience
Without a broker, securing approval can become a major roadblock.
Step 5: Conduct Due Diligence
Once you’ve identified a dealership, due diligence is essential to confirm its financial health and operational performance.
Brokers coordinate:
- Review of financial statements, tax returns, and P&L reports
- Analysis of service, parts, and warranty operations
- Legal and compliance checks
- Inventory audits
They work alongside your legal and accounting teams to ensure there are no hidden risks before you move forward.
Step 6: Negotiate the Deal
Negotiating an automotive dealership purchase is highly technical. Beyond the purchase price, the deal may include:
- Asset vs. stock purchase structure
- Real estate purchase or lease terms
- Employee retention agreements
- Transition support from the seller
- Non-compete agreements
A dealership broker acts as your advocate, ensuring you get favorable terms while keeping the process professional and efficient.
Why You Need a Car Dealership Broker
Buying a dealership is not a DIY process. A broker provides:
- Confidential access to listings you won’t find online
- Accurate valuations to avoid overpaying
- Financing support and lender connections
- Manufacturer approval guidance
- Negotiation expertise for favorable deal terms
- Due diligence management to protect your investment
- Smooth transaction coordination from first inquiry to closing
In short, a broker saves you time, reduces risk, and maximizes your return on investment.
Final Thoughts: Start the Journey the Right Way
If you’ve been asking yourself, “How to buy a car dealership?”, the answer is simple: start with the right partner. A car dealership broker gives you the expertise, connections, and support needed to make your dealership acquisition a success. Give us a call at Hicks Management and Consulting. As one of the top auto dealership brokers in the country, we can guide you through every step of the process.
Our auto dealership brokerage specializes in helping investors and entrepreneurs acquire profitable dealerships across the country. We even have a list of available dealerships, so if you’re interested to see what’s available, contact us today for a confidential consultation and take the first step toward dealership ownership.
