How to start a used car dealership in Canada

Before you sell a single vehicle commercially, you need a provincial motor vehicle dealer license. The licensing body varies by province: OMVIC in Ontario, AMVIC in Alberta, VSA in BC, MVIAA in Manitoba, and so on.

Each province has its own requirements, fees, and timelines. Contact your provincial regulator first to understand what is required before committing to a business location — some location types are not approved for dealer operations.

Register your business with your province before applying for a dealer license. Most dealers operate as sole proprietors or incorporated businesses. An incorporated business provides personal liability protection — important when operating any vehicle business.

Register for a Business Number with the CRA. If your annual revenue will exceed $30,000, you must register for HST/GST. Consult an accountant in your province for tax registration specific to your situation.

Your business location must be properly zoned for vehicle sales. This is a common stumbling block for new dealers. Verify zoning approval with your municipality before signing a lease or purchasing property.

Your lot needs adequate display space, signage that meets provincial requirements, a designated office or reception area, and proper records storage. Some provinces require minimum lot sizes — check your provincial regulator's requirements.

You will need a dealer management system (DMS) to manage inventory, process deals, run your website, and comply with recordkeeping requirements. Set this up before you open — manual systems break down quickly once you have vehicles to sell.

Establish relationships with auction houses (Adesa, Manheim) and local wholesale dealers for inventory sourcing. Trade-ins from private sellers are another source — market this on your website and social media from day one.