The car dealer (garage) has to maintain premises and pay staff. A car is indeed bought in and marked up, garages generally using either CAP or Glass price guides. It has to be prepared to resale standard mechanically and cosmetically, as well a warranty has to be financed, the garage is liable to deal with faults that could be deemed to have existed or have been developing at the time of sale. They also have to pay VAT and cannot reclaim VAT from reconditioning work. So they may add £1k+ but it's certainly not all profit. The last two vehicles I bought, one was from Motorpoint, the other (a fairly cheap Fiat Punto) from Ebay on a private sellers classified ad. I would consider dealers are not necessarily the best source for cheaper used cars, but you do have legal recourse in the event of problems.