The consumer auto industry is a hard one to disrupt, but after a few years of trial and error, Greenville startup iDrive On Demand thinks it’s found another avenue: a personal shopping service for cars.
The idea is a two-part pivot from the three-year-old company’s original car club concept, a membership model that kept pricing data transparent but was a barrier to entry for many consumers, according to iDrive President Ryan Alford. Today, Alford said the company sells more than 50 cars a month and is on track to nearly double sales from last year to $4.5 million by the end of 2015.
The new model has no membership requirement, and charges customers $1,000 for the search and asks for payment when they pick the car up. The difference, said Alford, is while dealerships add thousands of dollars to the sale price, he gets cars at a lower wholesale price, negotiates shipping himself and passes much of the difference to shoppers. A dealer might sell a 535i 2012 BMW for $47,000, but Alford can buy it wholesale for $32,000 and sell it to customers for $37,000, he said.
“I’m not trying to sell you an aging inventory,” said Alford from his office on Laurens Road, where he operates a body shop out back and holds a handful of cars awaiting customer pickups out front. The company also runs an office in Jacksonville, Fla., led by his business partner. “I wish we didn’t have a single car on our lot.”
While shoppers can buy almost anything with the click of the mouse, the consumer car industry has been slower on the uptake, though other digital services such as Carvana, Vroom and Beepi are slowly making gains. An Accenture survey released this year reported that a full 75 percent of consumers would consider conducting the entire car-buying process, including car selection, financing, price negotiation, back-office paperwork and home delivery, completely online. But many of those platforms still have inventory to push, said Alford, which can add overhead costs that are passed to consumers.
“Success would be that the average customer understands that he can custom-order a car without going through a dealer,” he said. “The car service part is getting people exactly what they want, not what they’ve settled for.”
Alford hopes to add five employees to his eight-member team by the end of the year, and said he’s working on a “technology solution” to ward off copycats. The firm could have a new location within two years, but the effort at hand is highly focused research and marketing efforts to support future expansion, he said.
