How Do I Become an ATV Dealer?

Bobby R. Goldsmith

To become an all-terrain vehicle (ATV) dealer, there are several steps that you must take to meet the legal and financial burdens of owning a dealership. You must first obtain a dealer license from your state or jurisdiction. You will also be required to post an insurance bond, and maintain proof of licensure and insurance coverage. Aside from the legal requirements for becoming an ATV dealer, you must make a significant investment in the infrastructure and inventory of the dealership. This will require a substantial amount of upfront capitalization. The path to become an ATV dealer also involves marketing and handling heavy competition for the off-road enthusiast market.

A large capital investment is usually required to become an ATV dealer.
A large capital investment is usually required to become an ATV dealer.

The legal requirements to become an ATV dealer vary by jurisdiction. Each state usually requires an application process for a dealer's license, possibly a commercial vendor's license, and an insurance bond. In 2011, California, for example, requires that a prospective ATV dealer apply for the license, obtain a dealer number, pay a $150 US Dollars (USD) application fee, pay a fee to the New Motor Vehicle Board, and maintain an insurance bond of $20,000 USD. To become an ATV dealer in Arizona, you must pay $100 USD to obtain a license and pay $100 USD annually to maintain that license. Several other miscellaneous fees are also required in addition to an insurance bond of up to $50,000 USD and a state background check.

ATV dealers must familiarize themselves with the off-road enthusiast market.
ATV dealers must familiarize themselves with the off-road enthusiast market.

There is also a significant investment in capital required to become an ATV dealer. You will need have a lot from which to showcase your inventory, establish a service center, conduct transactions and maintain various aspects of the business. It is not a good idea to operate a dealership from your private property that is used for other things, such as your residence or storage facility. You will also need to establish relationships with several ATV manufacturers and to obtain a corporate affiliation with a primary manufacturer.

When establishing your manufacturer relationships, be sure that none of your contracts include 100% exclusivity, which would prevent you from selling other brands of ATVs. For foreign manufacturers, you will have to arrange an importation and delivery system and negotiate for the best possible wholesale price per ATV. The lower the price that you purchase per unit, the higher profit you are able to generate. It also gives you and your sales team more leeway in customer negotiations.

To successfully operate an ATV dealership, you will need to market your operation and train your sales staff. Selling ATVs is entirely different from selling consumer automobiles. Off-road ATVs cater to a small, niche market of enthusiasts who are seeking a particular vehicle for one specific activity. For this reason, offering a variety of brands is important when building your inventory, as there is not too much difference between individual ATVs.

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