Ryan Alford doesn’t like to use the “D” word, but the iDrive car club is very much in the business of selling and buying cars. What online car seller iDrive wants, however, is to offer an experience and a price that keep people from ever confusing it with a traditional dealer.
The membership-based business makes its money by selling cars with either a flat markup fee or a percentage of sales, sharing pricing information with customers throughout the process.
iDrive achieved $2.5 million in sales revenue in 2013, its first year in business, and is on pace to near the $7 million mark in its second year. The company is betting that taking the mystery out of whether or not they’re getting the best deal will be a big draw for customers.
“Much like CarMax changed the game, the industry is ripe for disruption,” said Alford, an operating partner. The Greenville native brought iDrive to Greenville in 2013, building upon a company called Wholesale Car Club started by his friend and partner, Brent Boate, in Jacksonville, Fla. Alford, who most recently spent 15 years at Erwin Penland, first started in a marketing role, but became a part owner as he developed the process and rebranded the company.
“Opening in Greenville made sense because I didn’t just want to own the marketing. I wanted to live the brand and operate the business in order to expand it,” Alford said.
Alford said the main difference between iDrive and a typical dealership is that rather than purchasing cars they hope potential consumers will want, iDrive’s buyers simply go in search of the cars the club’s members want. That lowers overhead costs and, consequently, the members’ costs. Members pay a fee to join and then a flat $999 finder’s fee for cars that cost up to $50,000, and a 2 percent fee for more expensive cars.
The company is built on its ability to find any car anywhere, and deliver it to wherever members want. That includes fairly common cars, but also the 1986 candy-apple red 944 Turbo Porsche Alford recently found in Michigan for one member.
People have become increasingly comfortable with making large purchases online. Alford said despite the fact that cars are purchased sight unseen, social media and review websites have created a system of checks and balances where fraudsters are easily and quickly revealed. Along with that trend, the growth of tools for checking a car’s history and people’s general need for timesaving services have opened up market space for companies like iDrive.
“There are people who are always going to want to kick the tires, but we’re not trying to get those people who would never be comfortable [buying a car online],” he said.
Alford said he has owned more than 50 cars in his lifetime – more cars than years the 37-year-old has been alive, so he considers himself particularly qualified to comment on the car-buying process. The company has six employees, and Alford said he intentionally hires people with tattoos and piercings to underscore the un-dealer vibe, even as people check out cars on the small lot. The electronic music playing inside the office is akin to tunes one might hear late night at a cocktail lounge. The goal is a low-pressure environment, and the membership structure aims to cultivate lifelong relationships with individuals and families who will buy several cars.
iDrive keeps a small inventory in Greenville at a location near Haywood Mall. Anyone can purchase those cars. Recently, the inventory has included several Land Rovers and BMWs and a variety of other makes. Trade-ins are accepted. At the Jacksonville location, about 70 percent of sales occur online and the rest are on the lot. The income ratio is reversed in Greenville, with a current volume of 15 to 20 cars per month, Alford said.
Alford said people purchasing luxury vehicles between two and four years old are most likely to benefit from the club. He said the company does not intend to handle only luxury car sales, but cars under $10,000 are unlikely to create much of a savings for shoppers.
Even though iDrive is based online, Alford said people prefer to buy cars from sellers with some sort of physical presence in their market. “The vision is to be a franchise on a very limited nature,” he said. With between 10 and 15 offices, he expects iDrive to be able to create a nationwide distribution network that will expedite the process.
Even as iDrive works constantly to set itself apart from traditional dealers, Alford said he is looking for a space on the Laurens Road “Motor Mile” where several dealerships have been located for years. He said the move ostensibly goes against the image iDrive wants to portray, but it’s a smart move to get in front of people looking for cars – and a way to get in front of the competition.
