Did you know that the United States is one of the biggest players in the automotive industry? As a whole, the U.S. is the second-largest market for vehicle sales and production. In 2018, the U.S. exported $88.5 billion worth of auto parts alone, but this booming business isn’t only limited to international sales.
You can make a great deal of money delivering auto parts, and it’s an industry that doesn’t really require any training. Think about it this way: Cars won’t stop breaking down in the near future. The tech just isn’t there yet, and mechanics will always need to source parts to fix broken-down vehicles. This is where car parts delivery services come into play.
Delivering Car Parts Requires Market Research
Before you invest in your very first vehicle, you’re going to need to conduct some market research to find out exactly what kind of car parts delivery service is in demand. Are you in an industrial area with a lot of trucks and commercial vehicles? You may want to focus on parts for oversize vehicles only. Does your city have a booming scene for auto shows? Perhaps you want to focus on vintage car parts for historical restoration.
You can also charge a premium if you specialize in a specific brand of vehicle with parts that are often difficult to procure, but consider your location first. You probably won’t make a lot of sales hawking Porsche or Mercedes parts in a less-affluent area, but you will probably fare better selling tractor parts in a rural farming community.
Handle the Legalities
All businesses need a business license to legally operate, but you have to be a legal business entity first. Most businesses like an auto parts delivery service will opt to become an LLC or S corp. You’ll also need to register with the IRS and get an employer identification number. This can be done online in a few simple steps.
In addition to getting a business license, you may need a specific permit to sell car parts depending on the state. For example, in Michigan, you’ll need a used vehicle parts dealer license if you’re selling used auto parts. If your business is going to be dismantling cars and selling the parts, you might also need a vehicle dismantler license.
Get Insurance and a Reliable Vehicle
All businesses need general liability insurance and workers' compensation if there are any employees, but you’ll also need a commercial auto policy if your business is delivering car parts. This protects your business in the event that you or an employee gets in an accident while on the job.
In order to run a great car parts delivery service, you need to be reliable. This requires a reliable vehicle that won’t break down. It also has to be large enough to carry the parts you need to deliver.
If you’re delivering car parts for a standard-size vehicle, a pickup truck or a 3500-style cargo van may be large enough. If you’re delivering auto parts for commercial vehicles like trucks, buses and specialized machinery, you may need something larger, like a box truck. You don’t necessarily need a good vehicle, but you should at least buy a used vehicle that doesn’t have a lot of mileage.
Find Your Vendors and Promote Your Business
If you’re delivering auto parts, you don’t necessarily need to purchase a bunch of parts up front, but you should have reliable vendors so you can procure the parts needed. This might include junkyards, mechanics, dealerships or manufacturers. Cast a wide net.
If no one knows about your car parts delivery service, you won’t get very far. Let your local mechanics know about your services and advertise online. Sign up for Google My Business and Yelp for some greater visibility and consider advertising in trade magazines.
- Michigan.gov: Used Vehicle Parts Dealer License
- State of California Department of Motor Vehicles: Application Requirements for Dismantler License
- Small Biz Viewpoints: 4 Tips to Start a Successful Auto Parts Delivery Service
- Select USA: Automotive Spotlight
- Edmunds. "Aftermarket Versus Manufacturer Car Parts." Accessed April 12, 2020.
- RepairPal. "What OEM Parts Are, and Why They're Important." Accessed April 12, 2020.
- National Association of Mutual Insurance Companies. "Our Positions: Aftermarket Parts." Accessed April 12, 2020.
- Insurance Information Institute. "FAQs About Direct Repair Programs and Generic Auto Parts." Accessed April 12, 2020.
Mariel Loveland is a small business owner, content strategist and writer from New Jersey. Throughout her career, she's worked with numerous startups creating content to help small business owners bridge the gap between technology and sales. Her work has been featured in publications like Business Insider and Vice.