For Sale:
17 Year Old High Quality, High Volume, Used Car Dealership
Great Location, Great Website, 4.8 Stars Google, with Great Well-Trained Employees
Inventory: Inventory should be thought of as more valuable than cash for the following reasons: The more cars that the business has in stock, the more cars you can sell right after the closing. You will own the cars on the closing day at cost. This allows you to finance the purchase of the inventory through a bank loan as part of the total purchase price or use a “floorplan” inventory financing option. When you sell a car, you will recover the cost of the car PLUS a profit starting the same day that you own the dealership. This will reduce or eliminate the need for working capital as you will turn inventory into cash every day after the purchase of the business. Buyers always want to buy normal inventory levels with the business, or you will likely loose valuable salespeople who expect to have inventory to sell and most importantly cash flow so you don’t need to bring much working capital if at all.
Keep in mind the timing of this listing. Rarely are there 3 down years in a row in the used car industry and we just finished 2 ½ down years which means this purchase should be great timing as evidenced from how good the earnings have been in March and April 2025. Adding to this is the potential impact of tariffs which includes less imports which is making new cars more expensive and driving up the demand and therefore the price and profit of selling used cars which are not subject to the tariffs since they are already here in the US.
Various Valuation Methods: 1) Taking the last 5 periods average earnings which had 3 good and 2 bad years. This is the trailing 12 months, 2024, 2023, 2022, and 2021 which averages 835k per year in earnings which multiplied by the normal used car dealership multiple of 4 times would make the sales price 3.35M plus inventory. 2) Taking the last 3 years average earnings which had 2 bad years and 1 good year averages 645K per year X 4 times multiple =’s 2.58M plus inventory. 3) Taking the last 2 periods average of 762K X 4 =’s 3.05M plus inventory. Even if you lower the multiple to well below market, the expected sales price would still be well above the 1.95M plus inventory that he is asking.
Sales Price: The sales price is based on using an average of the trailing 12 months and 2024’s earnings which average 762K times a multiple of only 2.6 times which is 1.95M plus inventory. The real estate is being offered separately at 2.95M. This is priced to sell because he needs the money for personal reasons.
Auto dealers usually sell for +/- 4 times the earnings plus inventory because they are typically location driven fun businesses to own but we have priced this at less than 2.6 times the last 2 periods of earnings and less than 1.85 times multiple on the trailing 12 months earnings plus inventory. The inventory is extra and is currently estimated to be 2.25M which is cost plus their cost to prepare each car for sale. The actual amount of inventory will fluctuate daily as inventory is sold and new inventory arrives and will be adjusted at the closing properly. It is updated daily in their website.
They sell a wide range of used cars including Audi, BMW, Mercedes-Benz, Cadillac, Jaguar, Land Rover, Lexus, Porsche, Lincoln, along with all types of makes and models. The business will continue to grow on average over time based on their very high traffic location, quality inventory, experienced salespeople, repeat customers, referrals, and services they provide including accepting trade ins and offering financing choices.
He listed this business in early 2024 at 2.45M plus inventory but didn’t want to sell the real estate at the time and most buyers of dealerships want to buy the property also since the revenues are mostly location driven. We took it off the market quickly because the downtrend in the industry wasn’t over yet and he didn’t want to sell the property then. This company and the industry are back in an uptrend and has higher earnings now than when we listed it at 2.4M plus inventory and we have currently lowered the price to 1.95M plus inventory even though the earnings are much better now.
Although the owner has been involved in the business since its inception, he has greatly increased the time that he spends with his family, has other business interests, and has a place in Florida that they spend a lot of time at so he is not “the face of the business”, and has reduced his hours to 20 hours a week doing mostly training at this point.
The buyer will also get 100K dollars in current value of equipment, tools, furniture, computers, surveillance system, phone system, etc.
This company has a 4.8 Star Rating on Google, with 1,256 reviews, which is excellent, especially for a used car dealership which is very valuable considering trust is a big factor in choosing where to buy a car. It is rated A+ by the BBB. They are also a member of the “Colorado Automotive Dealers Association”. They have a great interactive website with all of their inventory posted on the website. This company has an excellent reputation in the industry. The new buyer will need to have or get a Colorado dealership license to be able to buy this which is obtained through the Colorado Motor Vehicle Dealer board and can take a month or two.
Summary: The sales price is only 1.95M plus inventory, which is currently estimated to be 2.25M. The real estate is being offered at an estimated 2.95M because an appraisal will most likely determine the final sales price of the real estate. He has asked me to screen for only serious buyers who can prove funds, or has secured financing, is successful private equity, or a buyer who already owns one or more dealerships already in Colorado. He will carry 10% of the dealership and none of the real estate. Lenders will require experience, a high net worth, and typically more than a 10% down payment. Some Buyers will prefer to use “floorplan” financing for the inventory and pay for the business portion without financing. I can’t set any meetings or phone calls with the owner unless you can prove that you are capable of buying this. Keep in mind that if you plan to floorplan the inventory, you will need to write a 1.95M check for the business because banks require the inventory as collateral which only lasts until each vehicle is sold at which time the new inventory can be floor planned. Normal banks generally don’t like used car dealerships but there are some banks that specialize in this type of business.
Location: South Denver, Colorado
Details:
There are 13 employees plus the owner: 2 sales managers, 5 sales people, 2 admins to answer phones and to make outgoing phone calls, a 1099 independent buyer of used cars, a 1099 independent marketing expert, a lot tech, and a bookkeeper/office manager and a title manager. The current employees have all proven their loyalty to the company and they work well together as a team. The Seller is willing to train a new buyer with little or no experience as needed. But the buyer must have the drive and aptitude or experience to run a busy retail business. He/she should also have a strong sales mindset.
The business has a solid name and a highly respected reputation for fair dealings. The seller will agree to full Reps and Warranties to a solid legal and business standing. There are no “ghosts in the closet”. They have a great record for safety and no legal issues of any kind.
Awesome location: The property is actually two lots in a great location with a very high traffic count all day and all weekend which is not just commuter traffic. He owns the “property” which he has leased to himself since 2005. He is now offering it for sale for 2.95M which he will consider adjusting reasonably depending on what an appraisal comes back at. It is set on two properties totaling 38,000 sq ft plus he rents an adjacent lot that is 10,000 sf. The business is operating on 3 different properties. It has a 4,900 square feet of building space including a 600 square foot main building that is very functional for the business operations, a 1000 square foot maintenance building with 6 bays, and a 500 sq ft showroom. There is a total of 9 offices, a break room, and a 6 bays for service/cleaning of new inventory. Security cameras are in place and there is plenty of parking. He paid himself 207K in rent in 2024 and believes the property will appraise for at 2.95M.
Growth and Expansion: A new owner, with the energy and experience to promote the business, will have numerous opportunities to grow this already well-established business.
He is partially absentee, and used car lots are fun places to own.
Please click this link to get the Non-Disclosure Agreement: https://
Thank you for your consideration,
Jeff C Eisnaugle
Business Broker Colorado, LLC
Direct 303-905-7607
Fax 720-524-6482
jeff@businessbrokercolorado.com
My Bank recommendations for used car lots and below that are floorplan recommendations if the bank and you prefer that for the inventory:
1ST Bank will look at financing both the business and the inventory. They like high net worth buyers and can be flexible.
Chris Evans
Executive Vice President
NMLS ID 994472
FirstBank – Denver
1144 15th Street, Suite 2000
Denver, CO 80202-2569
T 720.406-4566 | efirstbank.com
Will finance the dealership but not the inventory which can be floor planned separately.
John Hanlon SBA Business Development Officer
| M 941.243.9904 O 919.278.2378 F 833.899.4747 |
| jhanlon@NorthStateBank.com |
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Kim Evans
Commercial Lending
P 954-210-9802
F 888-867-7780
Email: kevans@starbanco.com
Website: www.starbanco.com
If these don’t work, I recommend Google to find more banks doing used car dealerships. I know most of the A lenders are not including Live Oak, Wells Fargo, Huntington, etc. I would recommend SBA preferred lenders that are not the big household names.
Floorplan Recommendations:
https://www.westlakeflooringservices.com/
https://www.coxautoinc.com/solutions/floor-plan-cars/