Buying and selling used cars is an art unto itself. You have to be able to spot cars that potential customers will want at a low enough price so you can turn a profit. That’s a task that’s much easier said than done.

Flipping cars can be rewarding if you can find your niche and maintain consistent sales. People will always need cars, and they’re usually worth something for as long as they run. Continue reading to get 5 tips to help you make significant profits from buying and flipping cars.

  1. Buy cheap. Shop at auto auctions.

The goal of any business is to sell products at prices higher than they pay to manufacture or purchase them. You also have to consider other overhead costs that affect your profit margin.

When it comes to turning a profit from used cars, your best bet is to buy cheap. The lower the amount you pay for a car and spend on its repairs, then the lower the amount you can sell it for and make a profit.

The best place to buy a car to flip is at an auto auction. Vehicles at auto auctions are usually repossessed with the bidding starting at prices just low enough to cover what the previous owners still owe on them. Also, because they’re repossessions and not trade-ins, auction cars tend to be in better condition. That means you have to spend less money on repairs.

  1. Build relationships with mechanics and autobody repair techs.

When looking to purchase a car for resale, you’ll learn that a car with dings and dents can be made to look like a new car again. Clunkers can be made to run again. And anything that looks new and runs well can sell.

If you plan on selling used cars, then you need to build relationships with mechanics and autobody techs in your area. You’ll come across a lot of nice cars that only need a fix here and there to be ready for a new owner. The better your relationships are with auto technicians are, then the more work you can get done for less money.

If you go to a particular mechanic on a regular basis with new cars for him to work on, then you can build a symbiotic business relationship. You may even want to bring your mechanics to auctions with you to help you assess how much work a car will need to be done before you purchase it.

  1. Make your presence felt in underserved markets.

One of the best ways to gain a monopoly in your market is to be where your competition isn’t. If you see the potential for market growth in an area where you have no competition, then go for it.

If you offer premium used cars for sale in Ghana, then you could capitalize on the lack of selection in the region. Most buyers have their cars shipped from America. If you have your own car lot in Accra or even Lagos, Nigeria, then you could get the customers that the importers are missing.

  1. Give away car maintenance kits with your vehicles.

One of the main things that people worry about with older cars is how to keep them looking new. Giving away products like Turtle Wax, car covers, and head light restoration kits will show customers your appreciation for their business. People love free stuff—especially when it helps with the upkeep of something in which they just invested a lot of money.

  1. Don’t make false guarantees.

One of the things that make people leery about shopping for used cars is the reputation of used car dealers. Nobody wants to feel like they’re being swindled or sold on a subpar product.

The best thing you can do for your business’s reputation is to maintain its integrity. Be honest with your patrons about the cars in your inventory. Don’t try to make a lemon seem like a diamond in the rough. Honesty may cost you a few sales in the short-term, but dishonesty will sink your business forever.