Table of Contents
What is the usual margin in the sale of used cars
Gross margin vs net margin: the difference that many ignore
Factors that condition the profit margin
How to correctly calculate the margin per car
Numerical example with REBU (Special Scheme for Second-Hand Goods)
Errors that reduce your margin without you realising it
How to improve the margin without raising prices
KPIs to control the profitability of your dealership
Conclusion
Frequently asked questions
The question that every used car dealership asks itself, sooner or later, is the same: am I earning enough per car? And the answer, in many cases, is not as clear as it seems.
When you ask a dealer how much they earn per unit, the figure they give you is usually the gross margin: the difference between what they paid and what they sold it for. But between those two figures there is a world of costs that are often forgotten or calculated incorrectly: reconditioning, paperwork, insurance, stock financing, time in the yard, commissions. If you do not have them under control, you may be selling cars with an apparent margin of 15% and a real profit close to zero.
This article is designed to put real numbers on the table. We will see what margins are common in the sector, how to calculate them properly, what errors erode them, and what levers you can pull to improve profitability per operation.
What is the usual margin in the sale of used cars
Margins vary greatly depending on the type of dealership, the area, and the profile of the vehicle. But there are ranges that serve as a reference to know if you are within reasonable limits.
The gross margin per car in independent used car dealerships usually ranges between 10% and 20%. This means that, on a car sold for €12,000, the gross profit before operating costs would be between €1,200 and €2,400.
Regarding the average profitability of the dealership as a business, Faconauto data for 2024 puts the figure at around 0.92% on total turnover. It is a low figure, but it includes all types of dealerships (also new car dealerships, which operate with tighter margins).
A relevant fact: the used vehicle offers slightly higher margins than the new one. According to industry data, the used car sector moves around an 8.8% margin on sales compared to 8.5% for new cars. It seems like little difference, but in a volume business, every tenth of a percent counts.
What these numbers do not show is the real dispersion. A dealership that buys well, reconditions wisely, and rotates quickly can move in gross margins of 18-22%. Another that buys on impulse, over-reconditions, and takes 90 days to sell may be working at 5-8% gross, which after operating costs turns into a loss.
Gross margin vs net margin: the difference that many ignore
This is the point where many dealerships lose the real view of their business. The gross margin is what is left after subtracting the purchase cost from the sale price. The net margin is what is left after subtracting all costs associated with that operation.
The gross margin includes only: sale price minus acquisition cost.
The net margin also discounts: reconditioning (mechanical and aesthetic), administrative procedures (transfer, agency fees), cost of stock financing (if you have a line of credit to buy), insurance while the car is in the yard, proportion of fixed costs (rent, staff, supplies), and depreciation of the vehicle while it is not sold.
A concrete example: you buy a car for €8,000 and sell it for €10,500. Gross margin: €2,500 (23.8%). But if the reconditioning cost €600, the paperwork €150, the car was 45 days in stock with a financial cost of €120, and the proportional part of fixed costs is €400, your real net margin is €1,230 (11.7%). If you also need to know the taxation well to correctly tax that operation, we recommend checking our complete guide on REBU in the buy-sell of second-hand cars.
Most dealers know their average gross margin. Very few know their real net margin per unit.
Factors that condition the profit margin
Vehicle type and local demand
Not all cars leave the same margin. Premium and nearly-new vehicles (under 3 years old) usually allow larger absolute margins, but they also require a higher initial investment and a slower rotation if they do not match the demand in your area.
Mid-range cars (Seat León, Peugeot 3008, Volkswagen Golf) with 3 to 6 years of age usually offer the best balance between margin and sales speed for independent dealerships. Very cheap cars (under €5,000) rotate quickly but leave tight absolute margins: between €300 and €800 per unit.
Acquisition channel
Buying directly from private sellers remains the path with the most margin potential: there are no intermediaries and the negotiation is direct. The disadvantage is that it requires more time and has more risk (real condition of the car, documentation, hidden liens).
Professional auctions (BCA, Autorola, Auto1) allow access to volume, but the margin per unit is usually lower because you compete with other professionals. Ex-leasing cars (LeasePlan, ALD, Arval) offer good condition and documented maintenance, but at prices that leave less room for return.
The key is to diversify channels and measure the real margin of each. If you want to delve deeper into how to choose the best sources of supply, we analyse it in our article on where dealerships buy cars.
Reconditioning
Reconditioning is the lever with the greatest direct impact on the margin. A well-prepared car sells faster and at a better price. But there is a point of diminishing returns: investing €1,500 in reconditioning an €8,000 car does not always allow you to add €1,500 to the retail price.
The rule of thumb used by many experienced dealers is that the cost of reconditioning should not exceed 8-10% of the target sales price. If it exceeds this, either the car was in a worse state than expected (bad purchase) or you are over-reconditioning.
Financing and additional services (F&I)
This is the factor that most independent dealerships underuse. Offering financing to the buyer not only facilitates closing the sale: it generates a commission that can add between 2% and 5% extra to the profit per unit.
The same applies to extended warranties, insurance, and admin services. A dealership that sells 100 cars a year and places an extra warranty in 50% of operations with an average margin of €150 per policy is generating an additional €7,500 annually. If you want to see what specific services you can offer and how much they can contribute, we detail it in our article on additional services that build customer loyalty and generate income in your dealership.
Rotation speed
A car that is sold in 20 days leaves more real margin than the same car sold at 60 days, even if the retail price is identical. Every day in stock adds cost: insurance, space, depreciation, financial cost. A stock that rotates 6 times a year is much more profitable than one that rotates 3, even if the average gross margin per car is lower. If you want to work on this metric, we recommend our guide on how to reduce stock rotation time in your dealership.
How to correctly calculate the margin per car
The formula for gross margin is simple:
Gross margin (%) = [(Sales price - Acquisition cost) / Sales price] x 100
Example: you sell a car for €12,000 that you bought for €9,500. Gross margin = [(12,000 - 9,500) / 12,000] x 100 = 20.8%.
But to get a real picture, you need to calculate the net margin per operation:
Net margin = Sales price - Acquisition cost - Reconditioning - Paperwork - Financial cost of stock - Proportional fixed costs
If you manage this in an Excel sheet, it is easy for some costs to escape you. If you do it with a system that centralises the sales file information (purchase, preparation, documentation, sale), the figure comes out on its own and you can make decisions with real data, not with feelings.
In operations under REBU, VAT is included within the gross margin (it is not added on top of the sale price as in the general regime). To get the net margin, it must be extracted correctly.
Numerical example complete with REBU
We take a real operation step by step.
Operation details:
Concept | Amount |
|---|---|
Purchase price from private seller | 8,000 € |
Sales price to customer (REBU) | 10,500 € |
Financing commission charged | 350 € |
Warranty sold to customer | 180 € |
Cleaning and preparation | 120 € |
Mechanical repair | 280 € |
Listing on portals (month) | 60 € |
Transfer management | 85 € |
Step 1: Buy-sell margin
10,500 − 8,000 = 2,500 €
Step 2: Gross margin
Additional income: 350 + 180 = 530 € Operation costs: 120 + 280 + 60 + 85 = 545 €
2,500 + 530 − 545 = 2,485 €
Step 3: Net margin with REBU
In REBU, VAT is included within the sale price (and therefore within the margin). To extract it:
Taxable base REBU = Gross margin ÷ 1.21 = 2,485 ÷ 1.21 = 2,053.72 € VAT included = 2,485 − 2,053.72 = 431.28 € Real net margin = 2,053.72 €
The difference between the buy-sell margin (€2,500) and the real net margin (€2,053.72) is €446.28, almost 18% less. Multiplied by twenty operations a month, that difference represents more than €8,900 a year that the dealer may believe they are earning but which actually goes to costs and taxes.
Full summary table:
Concept | Amount |
|---|---|
Purchase price | 8,000 € |
Sales price | 10,500 € |
Buy-sell margin | 2,500 € |
+ Financing commission | +350 € |
+ Warranty sold | +180 € |
− Preparation and cleaning | −120 € |
− Mechanical repair | −280 € |
− Portal listing | −60 € |
− Transfer management | −85 € |
= Gross margin | 2,485 € |
Taxable base REBU (÷ 1.21) | 2,053.72 € |
VAT included (REBU) | 431.28 € |
Real net margin | 2,053.72 € |
Errors that reduce your margin without you realising it
Buying without calculating the total cost of the operation. The purchase price is only the beginning. If you do not add estimated reconditioning, paperwork, and stock cost before buying, you are buying blindly. Many dealers discover that a "cheap" car left them less margin than another for which they paid more but was ready to sell.
Over-reconditioning. Changing tyres, polishing headlights, cleaning upholstery: that has a return. Painting an entire bumper on a €6,000 car, probably not. The question is always: is the buyer going to pay more for this, or am I going to absorb it?
Having cars stationary for more than 60 days. From 45-60 days onwards, the hidden cost of stock starts to eat into the margin. If a car has not moved for two months, the problem is not usually the car: it is the price or the visibility of the advert.
Not measuring the margin by acquisition channel. If you buy at auctions, from private sellers, and in trade-ins, but you do not know which of the three leaves you more real net margin, you are investing without information. Measuring this changes buying decisions.
Ignoring income from F&I. Not offering financing, warranties, or extra services is leaving money on the table. It does not require investment, just integrating these options into the sales process.
How to improve the margin without raising prices
Buy better. The margin is made on the purchase, not the sale. Diversifying sources of supply and having market data before bidding or negotiating is what separates dealerships working with margins of 18% from those moving at 8%.
Recondition with criteria. Establish a maximum preparation budget per car based on its target price. If the reconditioning cost exceeds that limit, the car was probably not a good purchase.
Rotate faster. Prioritise cars in high demand in your area. Use market data to know which models sell in less than 30 days and which ones sit. Apply programmed price reductions: if there is no interest after 30 days, drop it by 3-5%. If it doesn't sell after 45 days, drop it more. A car sold with a 12% margin after 25 days is more profitable than one sold with an 18% margin after 75 days.
Activate complementary income. Financing, warranties, insurance, admin processes. Each additional service adds between €50 and €300 to the profit per operation.
Control fixed costs. Automating administrative management (portals publishing, billing, contracts, files) reduces unproductive work hours. A dealership that manually posts to 4 portals and manages contracts in Word is spending time that could be dedicated to selling.
KPIs to control the profitability of your dealership
Gross margin per unit. Sale price minus acquisition cost. It tells you how much you "earn" before operating costs. Reference: between 10% and 20%.
Net margin per unit. What is left after all costs. If you do not measure it, you do not know if you are really making money with each car you sell.
Average time in stock. Number of days a car spends in inventory before being sold. Reasonable target: under 45 days. Over 60, there is a problem.
Average cost of reconditioning. How much you invest on average in getting each car ready. If it is higher than 10% of the retail price, review your purchase process or your workshop.
Lead closing ratio. How many sales you close for every contact you receive. A good ratio is between 8% and 15%. If it is lower, the problem could be response speed, lead quality, or the sales process.
Profit from additional services. How much you add per operation thanks to financing, warranties, and other services. If this number is zero, you have a clear opportunity for improvement.
If you want to delve deeper into which KPIs to follow and how to measure them, we explain it in our article on the 5 metrics that every dealership should measure.
Conclusion
The profit margin on second-hand cars is not a fixed number: it is the result of how you buy, how you prepare, how you sell, and how long you take to do it. Truly controlling it requires measuring every operation with all costs included, not just the difference between purchase and sale. Dealerships that do this well work with real net margins and make decisions based on data, not intuition.
More than 750 dealerships already use Dealcar
To control the real margin of each operation. From the platform you can see the total cost of each car (purchase, reconditioning, paperwork), the estimated margin before selling, and the net profit once the operation is closed. All in a single file, without spreadsheets. If you want to see how it works, you can schedule a free demo at dealcar.io.
Frequently asked questions
What is the recommended gross margin per used car?
Between 10% and 20%, depending on the type of vehicle and your area. For mid-range cars aged 3 to 6 years, a gross margin of 15-18% is a good target. The important thing is that the net margin (after all costs) is positive and measurable.
How much does a dealership earn on average per car sold?
The average net profit per unit is usually between €500 and €1,500, also considering income from financing, warranties, and other services. The figure varies greatly depending on the type of car, the purchase channel, and the operational efficiency of the dealership.
Do used cars give more margin than new ones?
Yes. Used cars offer a slightly higher gross margin than new ones (around 8.8% compared to 8.5% according to industry data). Furthermore, the independent used car dealer has more control over the purchase price and final margin than an official dealer, which works with prices set by the brand.
Which purchase channel leaves the most margin?
Buying directly from private sellers usually offers the highest margin, because there are no intermediaries. But it also requires more time and management. Auctions and ex-leasing are faster but with tighter margins. The ideal is to diversify and measure the net margin per channel.
How can I know the real margin of each operation?
You need to add up all costs: purchase, reconditioning, paperwork, financial cost of stock, and proportional part of fixed costs. With a file management system like Dealcar's, this information is centralised and the net margin is calculated automatically.
Table of Contents
What is the usual margin in the sale of used cars
Gross margin vs net margin: the difference that many ignore
Factors that condition the profit margin
How to correctly calculate the margin per car
Numerical example with REBU (Special Scheme for Second-Hand Goods)
Errors that reduce your margin without you realising it
How to improve the margin without raising prices
KPIs to control the profitability of your dealership
Conclusion
Frequently asked questions
The question that every used car dealership asks itself, sooner or later, is the same: am I earning enough per car? And the answer, in many cases, is not as clear as it seems.
When you ask a dealer how much they earn per unit, the figure they give you is usually the gross margin: the difference between what they paid and what they sold it for. But between those two figures there is a world of costs that are often forgotten or calculated incorrectly: reconditioning, paperwork, insurance, stock financing, time in the yard, commissions. If you do not have them under control, you may be selling cars with an apparent margin of 15% and a real profit close to zero.
This article is designed to put real numbers on the table. We will see what margins are common in the sector, how to calculate them properly, what errors erode them, and what levers you can pull to improve profitability per operation.
What is the usual margin in the sale of used cars
Margins vary greatly depending on the type of dealership, the area, and the profile of the vehicle. But there are ranges that serve as a reference to know if you are within reasonable limits.
The gross margin per car in independent used car dealerships usually ranges between 10% and 20%. This means that, on a car sold for €12,000, the gross profit before operating costs would be between €1,200 and €2,400.
Regarding the average profitability of the dealership as a business, Faconauto data for 2024 puts the figure at around 0.92% on total turnover. It is a low figure, but it includes all types of dealerships (also new car dealerships, which operate with tighter margins).
A relevant fact: the used vehicle offers slightly higher margins than the new one. According to industry data, the used car sector moves around an 8.8% margin on sales compared to 8.5% for new cars. It seems like little difference, but in a volume business, every tenth of a percent counts.
What these numbers do not show is the real dispersion. A dealership that buys well, reconditions wisely, and rotates quickly can move in gross margins of 18-22%. Another that buys on impulse, over-reconditions, and takes 90 days to sell may be working at 5-8% gross, which after operating costs turns into a loss.
Gross margin vs net margin: the difference that many ignore
This is the point where many dealerships lose the real view of their business. The gross margin is what is left after subtracting the purchase cost from the sale price. The net margin is what is left after subtracting all costs associated with that operation.
The gross margin includes only: sale price minus acquisition cost.
The net margin also discounts: reconditioning (mechanical and aesthetic), administrative procedures (transfer, agency fees), cost of stock financing (if you have a line of credit to buy), insurance while the car is in the yard, proportion of fixed costs (rent, staff, supplies), and depreciation of the vehicle while it is not sold.
A concrete example: you buy a car for €8,000 and sell it for €10,500. Gross margin: €2,500 (23.8%). But if the reconditioning cost €600, the paperwork €150, the car was 45 days in stock with a financial cost of €120, and the proportional part of fixed costs is €400, your real net margin is €1,230 (11.7%). If you also need to know the taxation well to correctly tax that operation, we recommend checking our complete guide on REBU in the buy-sell of second-hand cars.
Most dealers know their average gross margin. Very few know their real net margin per unit.
Factors that condition the profit margin
Vehicle type and local demand
Not all cars leave the same margin. Premium and nearly-new vehicles (under 3 years old) usually allow larger absolute margins, but they also require a higher initial investment and a slower rotation if they do not match the demand in your area.
Mid-range cars (Seat León, Peugeot 3008, Volkswagen Golf) with 3 to 6 years of age usually offer the best balance between margin and sales speed for independent dealerships. Very cheap cars (under €5,000) rotate quickly but leave tight absolute margins: between €300 and €800 per unit.
Acquisition channel
Buying directly from private sellers remains the path with the most margin potential: there are no intermediaries and the negotiation is direct. The disadvantage is that it requires more time and has more risk (real condition of the car, documentation, hidden liens).
Professional auctions (BCA, Autorola, Auto1) allow access to volume, but the margin per unit is usually lower because you compete with other professionals. Ex-leasing cars (LeasePlan, ALD, Arval) offer good condition and documented maintenance, but at prices that leave less room for return.
The key is to diversify channels and measure the real margin of each. If you want to delve deeper into how to choose the best sources of supply, we analyse it in our article on where dealerships buy cars.
Reconditioning
Reconditioning is the lever with the greatest direct impact on the margin. A well-prepared car sells faster and at a better price. But there is a point of diminishing returns: investing €1,500 in reconditioning an €8,000 car does not always allow you to add €1,500 to the retail price.
The rule of thumb used by many experienced dealers is that the cost of reconditioning should not exceed 8-10% of the target sales price. If it exceeds this, either the car was in a worse state than expected (bad purchase) or you are over-reconditioning.
Financing and additional services (F&I)
This is the factor that most independent dealerships underuse. Offering financing to the buyer not only facilitates closing the sale: it generates a commission that can add between 2% and 5% extra to the profit per unit.
The same applies to extended warranties, insurance, and admin services. A dealership that sells 100 cars a year and places an extra warranty in 50% of operations with an average margin of €150 per policy is generating an additional €7,500 annually. If you want to see what specific services you can offer and how much they can contribute, we detail it in our article on additional services that build customer loyalty and generate income in your dealership.
Rotation speed
A car that is sold in 20 days leaves more real margin than the same car sold at 60 days, even if the retail price is identical. Every day in stock adds cost: insurance, space, depreciation, financial cost. A stock that rotates 6 times a year is much more profitable than one that rotates 3, even if the average gross margin per car is lower. If you want to work on this metric, we recommend our guide on how to reduce stock rotation time in your dealership.
How to correctly calculate the margin per car
The formula for gross margin is simple:
Gross margin (%) = [(Sales price - Acquisition cost) / Sales price] x 100
Example: you sell a car for €12,000 that you bought for €9,500. Gross margin = [(12,000 - 9,500) / 12,000] x 100 = 20.8%.
But to get a real picture, you need to calculate the net margin per operation:
Net margin = Sales price - Acquisition cost - Reconditioning - Paperwork - Financial cost of stock - Proportional fixed costs
If you manage this in an Excel sheet, it is easy for some costs to escape you. If you do it with a system that centralises the sales file information (purchase, preparation, documentation, sale), the figure comes out on its own and you can make decisions with real data, not with feelings.
In operations under REBU, VAT is included within the gross margin (it is not added on top of the sale price as in the general regime). To get the net margin, it must be extracted correctly.
Numerical example complete with REBU
We take a real operation step by step.
Operation details:
Concept | Amount |
|---|---|
Purchase price from private seller | 8,000 € |
Sales price to customer (REBU) | 10,500 € |
Financing commission charged | 350 € |
Warranty sold to customer | 180 € |
Cleaning and preparation | 120 € |
Mechanical repair | 280 € |
Listing on portals (month) | 60 € |
Transfer management | 85 € |
Step 1: Buy-sell margin
10,500 − 8,000 = 2,500 €
Step 2: Gross margin
Additional income: 350 + 180 = 530 € Operation costs: 120 + 280 + 60 + 85 = 545 €
2,500 + 530 − 545 = 2,485 €
Step 3: Net margin with REBU
In REBU, VAT is included within the sale price (and therefore within the margin). To extract it:
Taxable base REBU = Gross margin ÷ 1.21 = 2,485 ÷ 1.21 = 2,053.72 € VAT included = 2,485 − 2,053.72 = 431.28 € Real net margin = 2,053.72 €
The difference between the buy-sell margin (€2,500) and the real net margin (€2,053.72) is €446.28, almost 18% less. Multiplied by twenty operations a month, that difference represents more than €8,900 a year that the dealer may believe they are earning but which actually goes to costs and taxes.
Full summary table:
Concept | Amount |
|---|---|
Purchase price | 8,000 € |
Sales price | 10,500 € |
Buy-sell margin | 2,500 € |
+ Financing commission | +350 € |
+ Warranty sold | +180 € |
− Preparation and cleaning | −120 € |
− Mechanical repair | −280 € |
− Portal listing | −60 € |
− Transfer management | −85 € |
= Gross margin | 2,485 € |
Taxable base REBU (÷ 1.21) | 2,053.72 € |
VAT included (REBU) | 431.28 € |
Real net margin | 2,053.72 € |
Errors that reduce your margin without you realising it
Buying without calculating the total cost of the operation. The purchase price is only the beginning. If you do not add estimated reconditioning, paperwork, and stock cost before buying, you are buying blindly. Many dealers discover that a "cheap" car left them less margin than another for which they paid more but was ready to sell.
Over-reconditioning. Changing tyres, polishing headlights, cleaning upholstery: that has a return. Painting an entire bumper on a €6,000 car, probably not. The question is always: is the buyer going to pay more for this, or am I going to absorb it?
Having cars stationary for more than 60 days. From 45-60 days onwards, the hidden cost of stock starts to eat into the margin. If a car has not moved for two months, the problem is not usually the car: it is the price or the visibility of the advert.
Not measuring the margin by acquisition channel. If you buy at auctions, from private sellers, and in trade-ins, but you do not know which of the three leaves you more real net margin, you are investing without information. Measuring this changes buying decisions.
Ignoring income from F&I. Not offering financing, warranties, or extra services is leaving money on the table. It does not require investment, just integrating these options into the sales process.
How to improve the margin without raising prices
Buy better. The margin is made on the purchase, not the sale. Diversifying sources of supply and having market data before bidding or negotiating is what separates dealerships working with margins of 18% from those moving at 8%.
Recondition with criteria. Establish a maximum preparation budget per car based on its target price. If the reconditioning cost exceeds that limit, the car was probably not a good purchase.
Rotate faster. Prioritise cars in high demand in your area. Use market data to know which models sell in less than 30 days and which ones sit. Apply programmed price reductions: if there is no interest after 30 days, drop it by 3-5%. If it doesn't sell after 45 days, drop it more. A car sold with a 12% margin after 25 days is more profitable than one sold with an 18% margin after 75 days.
Activate complementary income. Financing, warranties, insurance, admin processes. Each additional service adds between €50 and €300 to the profit per operation.
Control fixed costs. Automating administrative management (portals publishing, billing, contracts, files) reduces unproductive work hours. A dealership that manually posts to 4 portals and manages contracts in Word is spending time that could be dedicated to selling.
KPIs to control the profitability of your dealership
Gross margin per unit. Sale price minus acquisition cost. It tells you how much you "earn" before operating costs. Reference: between 10% and 20%.
Net margin per unit. What is left after all costs. If you do not measure it, you do not know if you are really making money with each car you sell.
Average time in stock. Number of days a car spends in inventory before being sold. Reasonable target: under 45 days. Over 60, there is a problem.
Average cost of reconditioning. How much you invest on average in getting each car ready. If it is higher than 10% of the retail price, review your purchase process or your workshop.
Lead closing ratio. How many sales you close for every contact you receive. A good ratio is between 8% and 15%. If it is lower, the problem could be response speed, lead quality, or the sales process.
Profit from additional services. How much you add per operation thanks to financing, warranties, and other services. If this number is zero, you have a clear opportunity for improvement.
If you want to delve deeper into which KPIs to follow and how to measure them, we explain it in our article on the 5 metrics that every dealership should measure.
Conclusion
The profit margin on second-hand cars is not a fixed number: it is the result of how you buy, how you prepare, how you sell, and how long you take to do it. Truly controlling it requires measuring every operation with all costs included, not just the difference between purchase and sale. Dealerships that do this well work with real net margins and make decisions based on data, not intuition.
More than 750 dealerships already use Dealcar
To control the real margin of each operation. From the platform you can see the total cost of each car (purchase, reconditioning, paperwork), the estimated margin before selling, and the net profit once the operation is closed. All in a single file, without spreadsheets. If you want to see how it works, you can schedule a free demo at dealcar.io.
Frequently asked questions
What is the recommended gross margin per used car?
Between 10% and 20%, depending on the type of vehicle and your area. For mid-range cars aged 3 to 6 years, a gross margin of 15-18% is a good target. The important thing is that the net margin (after all costs) is positive and measurable.
How much does a dealership earn on average per car sold?
The average net profit per unit is usually between €500 and €1,500, also considering income from financing, warranties, and other services. The figure varies greatly depending on the type of car, the purchase channel, and the operational efficiency of the dealership.
Do used cars give more margin than new ones?
Yes. Used cars offer a slightly higher gross margin than new ones (around 8.8% compared to 8.5% according to industry data). Furthermore, the independent used car dealer has more control over the purchase price and final margin than an official dealer, which works with prices set by the brand.
Which purchase channel leaves the most margin?
Buying directly from private sellers usually offers the highest margin, because there are no intermediaries. But it also requires more time and management. Auctions and ex-leasing are faster but with tighter margins. The ideal is to diversify and measure the net margin per channel.
How can I know the real margin of each operation?
You need to add up all costs: purchase, reconditioning, paperwork, financial cost of stock, and proportional part of fixed costs. With a file management system like Dealcar's, this information is centralised and the net margin is calculated automatically.
