Ninety-six square feet. That is the whole building requirement.

Texas measures your ceiling. Florida sends an examiner before you sign a lease. California gives you an exam. North Carolina wants a room of 96 square feet and a sign with three-inch letters, which sounds like the easiest licence in the country until you read what happens afterwards.

What North Carolina controls is not the building. It is the plates, the calendar and the threshold.

This page covers the used motor vehicle dealer licence. Everything below comes from NCDMV's own packet, manual and forms, listed at the bottom. Where NCDMV does not publish a figure, this page says so instead of guessing.

Five cars, and you are a dealer

North Carolina sets the lowest threshold of the states covered here. The statute NCDMV reprints in its own packet defines a dealer as a person who sells five or more motor vehicles within any 12 consecutive months, regardless of who owns the motor vehicles.

And it is not only selling. Arranging, offering, attempting to solicit or attempting to negotiate the sale of five vehicles counts. So does offering to sell, displaying, or permitting the display for sale, for any form of compensation, of five vehicles in the same window.

The window is any 12 consecutive months, not a calendar year, so it rolls. Four in a rolling year is the practical ceiling without a licence.

The building, which is genuinely small

• An established salesroom containing at least 96 square feet of floor space in a permanent, enclosed building
• Separate and apart from any living quarters, residence, or other business, and having a separate entrance
• A sign showing the trade name of the business in block letters not less than three inches in height on a contrasting background
• Zoning compliance with all State, County and Municipal ordinances or regulations, with a zoning letter in the application
• A real address. It is not permissible to have a mailing address different from the actual location of the business, and a PO box has to be in the same city as the dealership
• No tents or temporary quarters. The statutory definition excludes a tent, a temporary stand, or other temporary quarters

Ninety-six square feet is roughly eight feet by twelve. It is an office, not a showroom. The statute also counts the area contiguous to or within 500 feet of the premises as part of the salesroom, which is how a small office with a lot behind it satisfies the rule.

What NCDMV does not publish, and other states do: a display lot size, a number of vehicles you must be able to display, any surfacing requirement for the lot, an overall sign size or viewing distance, and any minimum opening hours or days per week. The closest the statute gets to hours is that the dealer can be contacted by the public at reasonable times.

The inspection comes before the application

Like Florida and unlike California, North Carolina looks at the site first. The requirements sheet says the site must be approved before submitting applications to the Dealer Unit, that the salesroom or office must be inspected and approved by an agent of the License and Theft Bureau, and that the record of inspection must accompany the application.

Applicants are told to contact the inspector for the county where they plan to open. Moving later means the new location has to be inspected and approved before you can operate from it, and NCDMV may make periodic inspections of premises and records afterwards.

The bond

The current bond form, LT-409, revised May 2023, sets it out:

The aggregate liability figure is a blank on the form, filled in per bond rather than printed. At $50,000 North Carolina matches Texas and California and asks double what Florida does.

The course

Used motor vehicle dealer applicants must show proof that within the last twelve months they have completed a 12-hour licensing course approved by the Division for an initial licence, and a 6-hour course for a renewal.

Two exemptions are printed: applicants who comply with the educational requirements of the separate statute governing manufactured-home dealers, and persons aged 62 or older at the time of application who are seeking the renewal of an individual or partnership licence.

No examination, passing score or retake rule is stated anywhere, which puts North Carolina with Texas and Florida and against California on that point.

Dealer plates are rationed by last year's sales

This is the part no other state here publishes, and the part that catches people who plan to run several cars at once.

A dealer who was not licensed for all of the previous 12 months gets four plates per qualifying sales representative employed on the date of application. A qualifying sales representative is one who works for the dealer at least 25 hours a week on a regular basis.

So a first-year dealer selling ten cars has three plates to move them with. That is a real operational constraint, and it is decided by a number you have to be able to produce on demand.

What you pay

These figures come from NCDMV's own New Dealer Packet, on the VS-415 requirements sheet printed inside it, revised June 2021. NCDMV publishes a newer sheet, LT-415 revised February 2024, which would not load when this page was written, so treat the amounts as the last ones we could read from the state rather than as confirmed current.

Counties that levy a Regional Transit Authority tax add to each plate: $1 in Randolph, $15 in Wake, Orange and Durham. NCDMV does not publish a renewal fee, an inspection fee, a fingerprint fee, or a fee for an additional location on the documents checked.

The June date

NCDMV does not state a licence term. Its regulation manual says a licence issued under the Act is valid until suspended, revoked or expired, which is not a term, and separately that every dealer shall, on or before the 30th day of June in any calendar year, apply for and obtain the licence and number plates required. Dealer plates themselves are issued for a period of one year.

Treat 30 June as the date the year turns, put it in a calendar, and do the six-hour renewal course before it rather than after.

What you have to hand in

• The inspector's report
• The application, the surety bond and the consent form, each notarised
• The 12-hour course certificate, dated within the past 12 months
• A zoning letter
• A garage liability insurance certificate or declaration page
• For a corporation or LLC, the meeting minutes and the Secretary of State filing
• An assumed-name filing with the Register of Deeds in the county where the business is maintained, if the trade name is not your own

NCDMV requires comprehensive liability or garage coverage to cover dealer plates but publishes no coverage amounts on the documents checked, which is unusual: Florida names $25,000 and $10,000 on the face of its own page.

After the licence

The record-keeping obligations are heavier than the premises rules, and they are the ones that produce penalties:

• Four years of records of every vehicle received, sold, traded or junked, and four years for each bill of sale
• Five years for every odometer disclosure form
• One year for the dealer's copy of each temporary marker receipt and report sheet
• Ten working days from issuing a temporary marker to get the titling documents to a plate agency or to DMV
• Title at the time of transfer. Failure to deliver the certificate of title at the time of transfer is a Type I violation
• Records must be kept so as to be readily available for inspection on demand

Penalties are published: Type I violations run $250, $500 and $1,000, Type II run $100, $250 and $500, Type III $50, with a $1,000 ceiling per violation. Selling without a licence is $5,000.

What this costs you before the first car

North Carolina's state fees are the lowest here: $97 for the licence, $45 to pre-screen, and $38.75 a plate. The bond premium is a percentage of $50,000 set by your credit, and the course is set by the provider. Rent on a 96-square-foot office with a lot behind it is the real number, and it is local.

Which is the part most new dealers get wrong. The licence is a fixed cost you pay once a year. The money is decided car by car, by costs that arrive one receipt at a time and are almost never all written down, and in North Carolina you also have to be able to state how many you sold, because that is what decides how many plates you get. What a good gross profit per car looks like works through why the headline figure overstates what a small lot actually keeps, and Deelary keeps every cost on the car it belongs to, with sales by month on the same screen.

Comparing states? Dealer license requirements by state puts the bond, the office, the sign and the course side by side. Texas measures the ceiling, Florida inspects before you file, and California gives you an exam you can fail. Do you need a dealer license to flip cars covers the threshold question first.