Cars need repair and maintenance at frequent intervals, and their parts break down even sooner. Since wear and tear is the primary reason owners must replace them, it creates a huge automobile parts industry. That means establishing an automobile parts business is lucrative with huge growth potential.
Owing to an increase in the number of cars on Indian roads, the automobile parts industry provides massive room for expansion in the future. According to research, the auto parts business grows at a faster rate than other small businesses in the country.
If you plan to set up an automobile parts business in India and want to know how to start a car accessories business, you have come to the right place. Here, you will find a complete guide to getting started and making things work without hassle.
How to Start an Automobile Parts Business?
Starting an automobile parts business is complicated. Thus, you need to consider several aspects to achieve success. Here is a stepwise guide to establishing a smooth start-up:
Research and Planning
Understanding your niche is the most crucial part of starting an auto parts business. Parts like air filters, exhaust systems, clutch kits, brake coils, etc., are some auto parts that remain in high demand. You must also research your target audience and competitors to start well. Research and plan properly to establish a business that attracts customers and makes sales.
Permits and Licenses
The next step is to obtain the required permits and licenses from the local municipality of your state. Moreover, you must register your business under the Indian Shop and Establishment Act. You will also need licenses to open a store and sell spare parts. GST registration is also compulsory to set up a commercial business in the country.
Also Read: How to Start a Business from Scratch in Simple Steps
Choose a Location
The auto parts store's geographic location largely affects its chances of success. A strategic location near target customers will be a huge plus. Consider locating your automobile parts business at a site that receives lots of cars every day. On the contrary, launching an auto parts store in a rural area will be a bad idea.
Financial Management
Since an auto parts manufacturing or sale business requires different types of labour and machinery, you will need ample capital to fulfil the requirement. Moreover, keep your book of accounts up-to-date. Consider the cost of your day-to-day operations and arrange the required funds to cover the expenses.
Contact with Suppliers
To make sales and profits and cater to your customer's needs, you will need a reliable supplier who can provide high-quality products at decent rates. It will help you keep good profit margins without over-pricing your potential clients. Whether you need OEM or aftermarket auto parts, you must choose a reliable supplier and contact them to raise a quote.
Also Read: How To Start A Startup In India In 5 Steps in 2023
Inventory Management
You will never want a customer walking into your store and not getting a part they want. After establishing your auto parts business, you must meet your customers' expectations to grow and expand. Inventory management ensures your store remains well-stocked with all in-demand auto parts. Once the stock is sold, prepare another order and fill it on your empty shelves.
Marketing and Branding
No business can do without efficient marketing. It helps get your name among the target audience and create demand. Open social media pages to spread information about your automobile parts business and display all the accessories in your stock. Holding car shows is also a good strategy to market the enterprise. Use brochures and flyers to announce updates about your business and provide information about the auto parts you deal with.
Also Read: How to Start Your Own Trading Business in India
How Can Business Loans Help You Expand an Automobile Parts Business?
A Business Loan is an extremely useful funding option to expand an auto parts manufacturing or sales business. Here is how it helps:
- Ample loan amount of up to Rs 40 Lakh
- Competitive interest rates, starting at 14%
- Flexible repayment terms of up to 60 months
- No minimum turnover requirements
- Digital Business Loan application for quick processing
Also Read: How to Start an Online Business from Home in 8 Steps
How to Apply for a Business Loan Online?
Now that you know how to start a car accessories business, learn how to apply for a Business Loan online to expand its operations:
- Visit the Hero FinCorp website
- Go to the Business Loan application page.
- Fill out an application form.
- Submit the necessary documents.
- Enter your desired loan amount and use a business loan emi calculator to select a suitable repayment tenure.
- Receive a reference number for future use.
- A representative will get in touch for more information if needed.
- Review and accept the loan offer to get disbursal directly into your bank account.
Also Read: How to Start a Food Business From Home in 2024
Conclusion
Setting up an automobile parts business provides ample opportunities to expand, considering the number of cars increasing in India yearly. This guide must have taught you how to establish the store properly with the required licenses and financing. To expand your operations, you can get the required funding easily and quickly with a Business Loan from Hero FinCorp. Whether you need finance to manage your store, restock inventory, pay suppliers, or build working capital, borrowing a Business Loan has various advantages, such as simple funding access, flexible repayment, reasonable interest rates, and quick loan approval.
Also Read: How to Start Your Own Clothing Brand in 7 Steps
Frequently Asked Questions
1. Is the auto parts business profitable?
The auto parts business is highly profitable due to low investment cost, high profit margin, and good growth potential.
2. What is the profit margin of automobile parts?
An average dealer has a 15-20% profit margin on automobile parts.
3. What are the most profitable auto parts?
Air filters, exhaust systems, clutch kits, brake coils, etc., are the most in-demand and profitable auto parts.
4. Why might an automobile parts business need a business loan?
An automobile parts business might need a Business Loan to expand its workplace, buy inventory, invest in marketing, build working capital, or for other purposes.
5. How much funding can I apply for with a Business Loan for automobile parts?
At Hero FinCorp, you can apply for a Business Loan of up to Rs 40 Lakh for automobile parts.
