“How did you get where you are today?” That is perhaps the number one question that entrepreneurs are asked by those seeking to learn from their success? By peering into the mind of someone who has done exactly what we want to do, we are able to get an idea of how success happens, what it takes, and ultimately how we can emulate it.
We had the privilege of speaking to Derek Emery, owner of CashForCarsCalifornia.com – a major used car retailer out on the west coast – and asked him just that question. He sat us down and told us all about his journey as an entrepreneur.
Derek grew up in a family that owned an art supply and custom framing business. Early on he got to see how business was done in a small shop and learn the ins and outs of entrepreneurship from his parents. After these formative years, he headed up East to the University of Maryland, his alma mater. After graduating from there, he got a job selling Toyota cars to people. This first sales job is where Derek really laid the foundation for his success today. He told us that his job at Toyota taught him “the #1 thing about sales is to sell something people will buy over and over again.” Every day he saw customers come in and trade their older Toyotas with 200,000 or 300,000 miles on them for the newest model. The customers loved the product and they were willing to buy it again and again.
Derek worked for Toyota doing sales for some time before he decided to cut his teeth on his own. He realized that there was a hole in the used car market that needed filling. While he was in California he realized there were a lot of used car dealerships offering cash for cars in Los Angeles, but few of them providing real customer value. For instance, customers did not want to have to drive to the car dealership in order to trade their car in. They wanted the convenience of a service like Amazon, where they wouldn’t even have to leave their home to trade in their car. Not only this but he also saw that most trade ins were severely undervalued by the appraising agents at the dealership. They didn’t always intend to rip off the customer, but one way or another they were not providing them a fair price for their vehicle.
Derek realized that in solving the first problem he actually would solve the second problem as well. By offering a to-your-door trade in service, Derek is able to save quite a bit on overhead because there is no brick and mortar operation that he has to pay for. His agents can simply head out to the consumers’ homes or offices and appraise the vehicles. If the customer accepts, they can write them a check and take the car. The savings on not having a storefront meant that they were free to offer even more competitive rates for trade-ins.
Derek’s business then takes the cars they have purchased and sells them at a dealer’s only auto auction. This means that at no point in his business model does Derek need a physical location. Buying all of these cars takes a significant amount of cash. They receive help with cash flow from the auto auction itself, which provides financing. The auto auction itself of course benefits from this because they also profit off of the cars that Derek brings to them with this financing.
Starting out, Derek was moving about 25 cars a month. That was twenty five years ago, and he now moves over 1000 cars a month with over 50 different buyers, DMV agents, and transportation drivers. He says this on the job experience has been the greatest teacher of any!
On a final and unrelated note, we wanted to find out any other advice Derek might have for entrepreneurs. We asked him who his biggest influences have been and what things outside of his work experience have helped him get where he is today. Derek told us that Dan Kennedy, author of the No BS series has been one of his biggest influences. It is important for business owners to have a few authors and influencers that they enjoy hearing from. These are the people that will continue to inspire you and keep you going even when you are frustrated and considering quitting. Without that sort of inspiration you don’t go from 25 cars a month to 1000. Derek is also a member of Dan Kennedy’s Titanium Mastermind Group, where he can network with other entrepreneurs and receive this sort of inspiration in person and recommends that every business owner be a part of one. If I’m ever looking to sell my car in Los Angeles, I know who to go to!