Are you looking to open a dealership in Minnesota but wondering what steps to take? Getting your vehicle dealership up and running can be complex at first as you go through the process of getting licensed. But after that, you will be ready to hit the ground running. We are here to help you get through the many steps of obtaining your Minnesota dealership license and to do so, we have created a step-by-step guide for you to reference along the way. 

5 Steps to Get Your Minnesota Dealership License

1. Which type of license do you need?

In the state of Minnesota, there are a handful of license types that you can apply for depending on your business intentions¹: 

• New motor vehicle dealer 
• Used motor vehicle dealer
• Motor vehicle wholesaler
• Motor vehicle broker 
• Motor vehicle lessor
• Motor vehicle auctioneer 
• Limited use dealer licenses

For the purposes of this article, we will be focusing on all the steps you need to take to become a new or used motor vehicle dealer. 

2. Rent or Buy a Permanent Location for Your Business

First and foremost, you have to find a location where you can operate your business. An assessment of this location will be part of your application and licensing approval process. The Minnesota Department of Public Safety has a commercial location checklist that you can reference to ensure that your business location meets all required qualifications. You can access the document here, but below is a brief snapshot of some of the qualities that you’ll want to ensure your location has: 

• A display area for at least 5 vehicles. 
• Easily readable signage that identifies what the business is. 
• A list of hours of operations. 
• Zoning approval from your local authority. 

3. Get Liability Insurance and an Auto Dealer Bond

You have to get liability insurance for all vehicles in your lot with coverage of at least $30,000 per person, $60,000 per accident, and $10,000 for property damage. Additionally, you have to secure an auto dealer bond of at least $50,000 (with additional costs for those selling boats, snowmobiles, small horse trailers, or mopeds). The cost of the bond will be a fraction of its total value, with an amount determined by your credit score and other personal financials. 

4. Gather and Fill out All Additional Documentation 

Additionally, you will also need to provide a few forms including²:

• Certification that proves compliance with Minnesota’s Worker’s Compensation Law.
• Verification of the property lease.
• A franchise agreement if you’re a new dealer only.

5. Pay All Fees and Submit your Application

Alongside your application, you are required to pay some fees: 

• $100 administrative fee. 
• $150 application fee. 
• $12.50 per vehicle. 
• $14.50 per duplicate plate. 
• $11 per sticker.

Then, you can include all payments and documents and submit your full application by mail to: 

Minnesota Department of Public Safety 
Driver and Vehicle Services 
445 Minnesota Street
St. Paul, MN 55101-5186

This is not intended as legal advice. If you have questions about dealer licensing requirements, please seek the assistance of legal counsel.

Find Used Car Inventory in Minnesota with ACV Auctions 

Once you are fully licensed in Minnesota and ready to operate your business, work with us at ACV Auctions to find used car inventory in Minnesota and across the country. Our online auctioning platform has the inventory you need to establish a desirable lot of vehicles that will expand your customer base. Each of our cars is inspected by our diligent team of vehicle condition inspectors. When working with us, you can trust that you are getting the high-quality inspection before you place a bid. Register with us once you get your Dealer License. 

‍

Sources

1. JW Surety Bonds. “Minnesota Auto Dealer License Guide.” Risk Strategies: JW Surety Bonds. Retrieved October 31, 2023. https://www.jwsuretybonds.com/states/minnesota/auto-dealer-license 
2. Byant Surety Bonds. 2023. “How to get a dealer's license in Minnesota.” Risk Strategies: Bryant Surety Bonds. Retrieved October 31, 2023. https://www.bryantsuretybonds.com/blog/minnesota-dealer-license-guide