How to Open a New Ford Dealership

by Stephanie Faris - Updated June 26, 2018
We have an agreement

There’s serious money in the car industry, with many dealership owners earning salaries in the six-figure range. Ford holds a large share of the car-buying market, second only to General Motors among U.S. automotive manufacturers. In a town where there isn’t already a Ford dealership nearby, opening one of your own can be the first step toward the financial independence you’ve always wanted.

Conduct Research

Before you fully make up your mind, put in the time required to carefully research the details of opening a dealership. You’ll need to take a state-mandated dealer certification course, which requires passing an exam. You’ll also need to find the right location and make sure the property is available for sale or lease. Most automotive manufacturers have specific requirements for dealership locations. Contact Ford’s corporate office to request this information before you proceed. The more you learn about the business in general and about Ford’s specific requirements for its franchisees, the better positioned you’ll be to get the go-ahead to open a dealership.

Gather Financing

It takes millions of dollars to open a franchise dealership, including building cost and inventory. If you have this money lined up before you contact Ford, you’ll be much more likely to get a “yes.” Visit a lender to determine how much you can expect to borrow. If possible, get preapproved for a business loan at that branch. Also, plan how you’ll make that cash infusion stretch, since the average cost of running a dealership is $4.6 million per year.

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Complete a Franchise Application

Once you’re ready to get started, contact Ford and ask for an application to become a dealer. Once approved as a franchisee, you’ll be asked to sign legal documentation agreeing to Ford’s terms. Among other things, this agreement outlines Ford’s right to terminate its relationship with you at any time should your dealership prove unsatisfactory. This means that you must ensure strong sales and a commitment to a positive customer experience, among other obligations. Although it will require a small investment on your part, a quick review from an attorney can save you headaches down the line.

Embrace Ford’s Vision

Once you’ve signed on to be a Ford dealer, you’ll be part of the overall Ford culture. The company has recently stressed the importance of its dealerships in sharing its long-term vision. This includes crowdsourced shuttle services, ridesharing, drones and autonomous vehicles as part of its City of Tomorrow proposal. Successful dealerships will pay close attention to this vision and get involved in making it happen in their own communities.

About the Author

Stephanie Faris is a novelist and business writer whose work has appeared on numerous small business blogs, including Zappos, GoDaddy, 99Designs, and the Intuit Small Business Blog. She worked for the State of Tennessee for 19 years, the latter six of which were spent as a supervisor. She has written about business for entrepreneurs and marketing firms since 2011.

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