Business Loans for Auto Dealerships
Business Loans for Auto Dealerships
The auto market can be a fickle one; economic swings have a big effect on how likely people are to buy cars, new or old. That makes things difficult for car dealers. But we can help. Shield Funding has been helping car dealerships and other businesses weather difficult times and prosper during good ones for over 10 years.
Most studies show that the average American household owns around two cars. The number of cars owned by Americans is creeping toward 300 million. Which means car dealers have huge opportunities.
But there are also a lot of difficulties. When the economy isn’t performing well, people don’t buy as many cars. Seasonal swings in business put dealers in tough situations. And changing expectations mean you need to adapt quickly if you don’t want to get left behind.
As an alternative lender, we help car dealers get the loans they need to do great business. The process is fast and easy and business funding can be as fast as the same day that you apply. Get started online today.
What Do I Need to Qualify?
Below is a list of the requirements to get approved for business funding with our most basic program. There may be additional factors that are considered, meeting these three requirements though gives you a very high chance of having your application approved.
How Do I Apply?
Applying has never been easier. You can either call our toll free number 24 hours 7 days a week at
Submit your online application by clicking apply below and entering a few basic details about your business.
Here are some of the business funding options we offer for automobile dealerships.
Car dealers have a lot of expenses. Whether you sell new, used, or both, you need to invest a lot of money into inventory. When you’re growing your business, that could mean millions of dollars.
And there are lots of other expenses, too. Real estate, salaries, commissions, upgrades, service offerings, and all of the other costs that go into running a car dealership add up quickly. Which is why we help car dealers with loans of up to $1,000,000.
If you’ve been in business for two months and bring in at least $8,000 of monthly revenue, you can qualify for a small business loan from Shield Funding. And with interest rates as low as 5%, you’ll get a great return on your investment.
Your profitability depends on both buying and selling cars at good prices. When you have the opportunity to buy at a low price, you have to be ready to take it. A business line of credit is like a credit card with a much lower interest rate—and will let you buy cars for your dealership even when you don’t have cash on hand.
You get up to $250,000 of credit to spend. You can spend as much as you’d like at one time, and then pay monthly installments on the loan balance. Because interest rates are 5–10%, instead of up to 30%, you’ll save a lot of money over using a credit card. And you’ll be able to make it back in sales.
You’ll need six months in business, $10,000 in monthly revenue, and a credit score of 650 to qualify. If you meet those requirements, you can open a business line of credit and start taking advantage of the flexible funding you need to grow your business.
Getting a traditional loan from a bank with bad credit is almost impossible. If you don’t have phenomenal credit, you’ll almost certainly get denied—and if you don’t, you’ll get terrible terms. We know that people make mistakes, so we work with car dealers who have bad credit.
As long as your credit score is above 500, you can qualify for up to $1,000,000 in funding. And you can get interest rates as low as 12%. We don’t take advantage of your limited options to put the squeeze on your finances.
Like our small business term loans, you can use a bad credit business loan for anything you want. Add to your inventory. Hire more staff. Expand the size of your lot or showroom. Anything you need to run or improve your business.
Traditional lenders usually require collateral. But that can be difficult for car dealers to provide, because their inventory is constantly shifting. And if any of that collateral gets repossessed, you’re going to have a difficult time recouping the cost.
Our unsecured small business loans for car dealers don’t require any collateral at all. So you’re not putting your livelihood at risk. And we don’t require that you have amazing credit to get an unsecured loan.
If you’ve been in business for a year, have $10,000 in monthly revenue, and have a credit score of 500 or greater, you can qualify for up to $1,000,000 in unsecured loans. And the interest rate can be as low as 9%.
Business Financing Tips for your Additional Working Capital
Increasing Service Options
Service departments at car dealerships bring in hundreds of millions of dollars every year. They can also be a great asset when it comes to sales of new cars. But their greatest benefit is creating a one-stop shop for customers.
Whether customers want to buy a new car, get their oil changed, have some serious maintenance done, or just drop in to see if they need a fluid top-up, your service department is the front line. The more options you provide and the better pricing you offer, the more money you’ll make from your service department.
Adding more service bays lets you serve more customers at once, reducing wait times. New and upgraded equipment will help you service the highly complex systems that come standard on new cars.
These things add a huge amount of value for customers. And that’s what keeps them coming back.
Hiring the Right Staff
Car salesmen have a notoriously bad reputation. If a customer has an experience that reinforces that reputation, they’re not likely to come back to your dealership. So you need to make sure that you hire people that are going to provide phenomenal service to your customers.
But having the right staff isn’t limited to your on-the-lot salespeople. A quarter of customers make contact with dealerships via phone, so you need to have good people on the phones, too. Not just receptionists—you should have salespeople, able to talk about price, ready to answer.
Customers are irritated by pushy salespeople who don’t know much about the cars they’re selling. That’s exactly what you avoid when you bring on experienced, talented team members. They know how to create a positive experience for your customers, and that’s crucial.
Creating a Positive Showroom Experience
In fact, creating a positive experience needs to be a high priority throughout your company. Customer experience is hugely important. Auto buyers are more likely to buy from dealers that provide a great experience than those who have the lowest price. They’re more likely to become loyal customers, too.
And that goes beyond your salespeople. Your showroom, service area, and car lot need to be clean, modern, and provide the things your customers want. Do you have uncomfortable chairs in your waiting areas? It’s time to upgrade them. Is the floor of your service area severely oil-stained? Get it professionally cleaned.
These might seem like minor factors, but they can make a big difference in the overall experience of your customers. Of course, they all cost money, too. And if you don’t have the cash to retrofit your dealership, a loan can be a big help.
Think of it this way: if investing a few thousand dollars results in even a handful of loyal customers, you’ll get a positive return on your investment. Now what about if it earns you a dozen loyal customers that might have gone to a competitor? It’s worth spending time and money on.
Managing Your Online Presence
Consumers spend a lot of time researching cars online. Third-party reviews and manufacturers’ websites are the most popular resources, but you have a huge opportunity here. If a consumer comes across your website and finds the information they need to make a decision, they’re more likely to go to your dealership instead of a competitor.
Is the information on your website correct and up to date? What about the information in Yelp, Google My Business, and local business listings? If it’s not, you’re putting barriers between potential customers and a purchase from your dealership.
Smart car dealers are also investing in better websites that include helpful content, social media managers, and advertising campaigns that get their information in front of potential buyers. Car dealerships don’t have a reputation for being especially web-savvy, but if you can break that trend, you’ll get in front of a much wider audience.
Want to learn more about how our loans can help you accomplish these tasks? Curious about which type of loan is best for you? Have any other questions? Get in touch today and we’ll get you the answers you need!