There are several steps to becoming an all-terrain vehicle (ATV) dealer that must be completed in order to meet the legal and financial requirements of owning a dealership. Your state or jurisdiction must first issue you a dealer license. You must also post an insurance bond and keep proof of licensure and insurance coverage on file. Aside from the legal requirements, becoming an ATV dealer necessitates a significant investment in the dealership’s infrastructure and inventory. This will necessitate a significant amount of capitalization up front. Being an ATV dealer also entails marketing and dealing with a lot of competition in the off-road enthusiast market.
The legal requirements for becoming an ATV dealer differ depending on where you live. A dealer’s license, possibly a commercial vendor’s license, and an insurance bond are usually required by each state. A prospective ATV dealer in California, for example, must apply for a license, obtain a dealer number, pay a $150 application fee, pay a fee to the New Motor Vehicle Board, and maintain a $20,000 USD insurance bond in 2011. To become an ATV dealer in Arizona, you must pay a one-time fee of $100 USD and an annual fee of $100 USD to keep your license active. Aside from an insurance bond of up to $50,000 USD and a state background check, there are a few other fees to consider.
Becoming an ATV dealer also necessitates a significant financial investment. You’ll need a lot to display your inventory, set up a service center, conduct transactions, and keep track of various aspects of your business. Operating a dealership from a private property that is also used for other purposes, such as your home or a storage facility, is not a good idea. You’ll also need to build relationships with a number of ATV manufacturers and secure a corporate affiliation with one of them.
Make sure none of your manufacturer contracts include 100 percent exclusivity, which would prevent you from selling other brands of ATVs. You’ll need to set up an importation and delivery system for foreign manufacturers, as well as negotiate the best wholesale price per ATV. The lower the price per unit that you purchase, the more profit you will be able to make. It also gives you and your sales team more flexibility when negotiating with customers.
To run a successful ATV dealership, you’ll need to market your business and train your salespeople. Selling ATVs is not the same as selling cars to the general public. Off-road ATVs cater to a small, niche market of enthusiasts looking for a vehicle designed for a single purpose. As a result, when building your inventory, offering a variety of brands is critical, as there isn’t much difference between individual ATVs.