How To Start Used Bike Showroom?

Table of Contents:

1. Need For Used Bike Showroom

2. Indian Old Bike Showroom Market: Current Scenario

3. Used Bike Showroom Business Plan

4. Costs Involved In Old Bike Showroom Investment

5. Marketing & Advertising: Promoting Your Second Hand Bike Dealer Showroom

6. Second Hand Bike Dealer

FAQs On Used Bike Showroom

1. Need For Used Bike Showroom

With new & exciting features & styles being introduced by the bike manufacturing companies, many bike riders upgrade to new bikes discarding the old ones. At the same time, on the other hand, a massive number of people can't afford new bikes and so buy a good preowned one. This is what has made second-hand bike dealership a money-spinning business, and if you too are planning to capitalise on this opportunity, it is undoubtedly the right time.

However, to start a second-hand bike showroom, you need some mechanical engineering skills. If you don't own any, you can hire an experienced mechanic who can examine the old bikes well before investing your money in buying it and putting it on sale. Not just this, running a second-hand bike showroom business has its specifications that you must be aware of before you place your money at stake.To help you get your mission of starting a used bike showroom business accomplished, here in this article, we have come with a stepwise guide that contains the minutest details of running this business successfully. So, let's walk through the details.

2. Indian Old Bike Showroom Market: Current Scenario

At present, three in every ten two-wheelers sold in India are used ones. In fact, if you look at the data, at 6.6 million units, the preowned two-wheeler market of India is bigger than the entire new two-wheeler industry of the African continent. In the past five years, it has grown 20-25% annually as per the estimations. Till the last financial year, the market of pre-owned two-wheelers was almost 40% of the new two-wheeler market.

With India replacing China as the largest two-wheeler market worldwide and used 2W market growth booming high, the second-hand bike showroom has indeed become a lucrative business. Moreover, India's two-wheeler sharing market was valued at $31.1 million in 2019, which is expected to reach $94 million by 2025, witnessing a CAGR of 20.2% during the forecast period (2020-2025).

3. Used Bike Showroom Business Plan

Anyone can learn through trial & error, but with every mistake that takes place, there is some loss involved, and even small losses together can lead to a significant loss. Moreover, it is always wise to learn from the mistakes of others rather than committing it yourself. An excellent way to do that, however, is to create a business plan. While making the plan, you keep the mistakes that others have committed in mind and predefine your moves along with the dos & don'ts of running a business.

The first step of creating a business blueprint is to decide the business objective. The primary goal of running a second-hand bike showroom should be to achieve 100% customer satisfaction. Each satisfied customer can bring you more referrals and even repeat business. The second objective you should decide is somewhat related to the first one, and it is attaining or exceeding the profit margins within the first two years after inception. If customers are satisfied, they will bring you more sales, which means more substantial profit margins. Study well the industry facts & figures before creating the business plan.

As far as your second-hand bike showroom business's mission is concerned, it should again be customer-centric. Try to focus on providing the most hassle-free bike buying experience to your customers. Please pay more attention to the quality of the bike you will be providing them. Try exceeding the customer expectations with both the product & the experience. Your employees play a significant role in bringing you sales, including employee welfare as well in your business strategy. Offer them bonuses & incentives for all the efforts they put into getting you sales.

Deciding the right location is immensely imperative for a second-hand bike business. Ensure the site you have finalised for starting the showroom has a good supplier network that can help you easily buy or sell second-hand bikes of optimum quality at attractive prices.

4. Costs Involved In Old Bike Showroom Investment

You don't need an immense fortune to start a second-hand bike showroom. In fact, in the beginning, you should refrain from making unnecessary expenses.  The main costs that are involved in the initial days of this business are:

• The rent for the showroom
• Charges involved in legal formalities
• Marketing and advertising expenses
• Accountant's consultation charges
• Desks & furniture
• Equipment such as computers, telephone and fax/ copier
• Stationery and office supplies
• Location Analysis: Finalising the Location

As discussed earlier, the location you choose would be such that buying & selling optimal quality used bikes at striking prices should be easy. It would be best if you researched as to whether the people in that area are capable of purchasing a second-hand bike or not. Take local laws of the region or state, demographics, and accessibility into consideration while deciding the location. There shouldn't be an existing second-hand bike showroom in that area. Keep parking space availability as well as safety & security in mind before finalising the location.

Licensing: Why Taking a Dealer's License so Imperative?

No matter whether it's a second-hand bike showroom, as long as it's a business, it would require proper licensing. You need to obtain a dealer's license to get legal permission for operating your second-hand bike showroom business. Usually, people refrain from buying a bike from a dealer who doesn't have a dealer's license, and that a dealer's license makes your showroom a more reliable source for buying or selling bikes. The process, however, for getting this license varies from state to state. So, you should contact your town's municipal corporation authority to get one.

5. Marketing & Advertising: Promoting Your Second Hand Bike Dealer Showroom

Marketing and advertising are quite crucial for running any business successfully. There are two ways you can market & advertise your second-hand bike showroom, and that is digital & offline. The ubiquity of smartphones and the internet of things has made digital marketing the need of the hour. If you want your business to boom high, you must market your business digitally, for which the first thing you need to do is getting a website and promoting it through various channels like search engines, blogs, social media, etc. In offline advertising, you can start by giving ads in a local newspaper, radio stations, or by distributing pamphlets & posters. Putting hoardings at strategic locations is also a good idea.

Please note as far as buying the used bikes is concerned, you can go to the classified section of the local newspaper or visit online buying & selling sites. Also, please create a dedicated section on your website to sell bikes and not just buy. Ask people to fill in their names, phone numbers, email, and other relevant information while inquiring about buying or selling the bikes so that you can easily follow up with them.

6. Second Hand Bike Dealer

You can run a used-bike showroom business as your full-time or part-time occupation. The best part about starting a second-hand bike showroom is you don't require an immense fortune or make substantial expenses. All you need is a systematic approach to running your business. Moreover, if you start the used-bike showroom in prime locations like a highway, garage, or transport area, you are sure to get a good response.

The space for the bike showroom should be vast to accommodate as many bikes as you want. Concentrate on the quality of the product and give customers' bike buying experience the utmost priority. Remember, satisfied & happy customers mean long-lasting business. Some of the don'ts of running a second-hand bike showroom, however, are buying or selling bikes without proper documents, investing too much money in the beginning, buying bikes that have major repairing issues, and so on. In short, follow the tips & guidelines we have discussed in this article and earn big profits.

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FAQs On Used Bike Showroom

Q. Is used bike business profitable?

Ans- Indian Second-Hand Bike Market: Current Scenario & Forecast- In the past five years, it has grown 20-25% annually as per the estimations. With India replacing China as the largest two-wheeler market worldwide and used 2W market growth booming high, the second-hand bike showroom has indeed become a lucrative business.

Q. Which bike company is best in India?

Ans- Some of the Top Two Wheeler Companies in India are as follows:

• TVS Motor Company
• Hero MotoCorp
• Honda Motorcycle and Scooter India
• India Yamaha Motor
• Bajaj Auto

Q. What is the profit in bike showroom?

Ans- The general two-wheeler Dealership Margins ranges from 50,000 to 75,000 Rupees for Scooties and Bikes the per margin profit ranges from 75,000 to 1,00,000 Rupees. The dealer margins range from 4% to 7% depending on the brand and its authenticity of being a domestic brand or an imported vehicle.

Q. How can I open bike showroom in India?

Ans- First of all, access the brand's website that you want the showroom to open. Then open the application tab for the dealership. For example, open the page where you can apply and fill out the form to become a dealer. Similarly, any brand as such available in India may be used.

Q. How do I open showroom?

Ans- The standard procedure of getting into the car dealership business:

1. Filling out the application form.
2. Securing a surety bond (the number of security bonds that you might need, depending on your line of business).
3. Buy liability insurance for your vehicles.
4. Apply for a GST tax number.
5. Develop your business location.