What Do You Need to Set Up a Motor Trade Business?

Business Tips / Thursday, October 12th, 2017

Setting up your own business can be a great way to get free of the rat race and gain financial independence. However you have to go about it in the right way. Below are some key requirements for setting up in the motor trade.


In order to be eligible for motor trade insurance you need to meet the following criteria –

  • Be at least 21 years old – You must be at least 21 years old to get a traders policy. The risks involved with running a motor trade business mean very few providers will offer cover to those younger.
  • Have a full UK driving licence – Holiding a full driving licence is another minimum requirement to qualify for cover.
  • Be able to prove you work in the motor trade – You must be able to provide some proof, usually in the form of customer receipts, that you do in fact work in the motor trade.


In order to start a motor trade business, you’ll want to have at least some experience in the industry. There are many different types of motor trade business you can set up. The way a lot of people get started is by buying and selling cars. This is because the barriers to entry are fairly low.

However the right type of business for you will depend on your particular skills. For example if you have worked for years as a mechanic at an MOT centre then it makes sense to set up on your own in that field.

A premises

You’ll almost certainly need a premises when setting up a motor trade business. There are some exception to this, for example if you work as a mobile mechanic or are just getting started buying and selling vehicles. However in most cases a premises is necessary.

Be sure to pick a premises that meets your criteria and don’t be too hasty to invest in it before you’re 100% sure you’re happy.


You’ll also want to hire employees to help you run your business. You should always be very selective when it comes to employees to give your business the best chance of success.

A good employee should fit the following criteria –

  • Have a good attitude
  • Have a good amount of experience
  • Have no criminal record