A better way to buy and sell used cars
Evan Berney is the CEO of Carbiz. Headquartered in Baltimore, Carbiz is a vehicle dealership that provides customers with innovative ways to buy, sell, and trade used cars. The company allows shoppers to browse inventory and buy online, and offers complimentary one-year coverage, free delivery, and a five-day return policy. Carbiz is dedicated to giving back to the community through a partnership with ME to WE—a social enterprise that empowers consumers to change the world by making purchases and tracking their impact.
EDWIN WARFIELD: Tell us about some of the milestones Carbiz has reached throughout your history.
EVAN BERNEY: The first milestone was really the first month we sold 100 cars. That, to us, was the milestone that we had been setting for ourselves. We opened in 2003 and that happened in 2005. Within two years, we were selling a hundred cars per month, and since then, I don’t think we’ve gone below one hundred cars in a 30-day period—maybe twice in 11 years.
The next milestone was weathering the recession. We had got ourselves to a point where our business was doing very well, and in 2007 and rolling into 2008, when the market fell out, it had a big effect on used cars. Gas prices went up, SUVs dropped, and overnight we found ourselves losing probably 20% of the value of our inventory. We were left from there to just pick up the pieces and keep moving forward. We had had such a positive year through probably about seven months of the year before it really crashed that we were able to still remain even with that depreciation on those cars and the potential write-downs we had to take. We still were able to end up flat for the year. For us, that really resonated as a success because, around us, we saw new car stores getting their franchises pooled. We saw used car dealers having to fold up and go out of business. For us to have weathered that and made it through relatively unscathed was a success.
The following year, we started the process to build Carbiz in the location that we are currently. In 2008 to 2009, while others were trying to figure out how to maintain or keep their doors open, we were building, and we built through it. We opened our doors at the end of 2009, just coming into 2010. That’s really the next milestone: building the building.
The following year we built a service center. We bought property next to us: a giant food store, so it was the perfect combination. It was right across the street—25,000 square feet of space that we were able to turn into a service center and really grow that side of our business and allow our service center to handle the volume of the internal cars that we have to get ready for sale.
A few years back, we built a body shop and took over control of that side: reconditioning and the service side of the operation. With our reconditioning, we do everything in-house, so that was our goal: to not have to contract anything out, not have to be at the mercy of other businesses and their time schedules and how long it will take to get cars reconditioned. Build everything in-house to keep everything internal.
Q. What role has your business’s name and brand played in your success?
A. We feel so fortunate to have the name Carbiz. That was the pillar of this whole brand and this personality. I’ll just tell you a really quick, pretty neat story. It sounds very simple—Carbiz, right?—but Carbiz came from my grandfather, who drove around in his vehicle with vanity plates that said “Carbiz” on them. This is probably going back 50 years. My dad had started wholesaling, after he sold his new car stores, under the name Carbiz for that reason. It was Carbiz Auto Brokerage—that’s how it started. There was a company out of Florida that was Carbiz.com. They were a software company and it sold software to dealers. They went bankrupt and immediately we were on the phone. We got a hold of the bankruptcy trustee and negotiated out buying the URL. That was monumental to the brand.
Something we’ve done since the very beginning—this goes back to when we opened our doors—was building the brand around Carbiz and building a brand that people would recognize, but recognized to be more of a national brand. Part of having credibility as a used car dealer was trying to build on this idea that, at the time, maybe we’re bigger than we were. When we started out, we wanted to give consumers the perception that we were bigger than we were, and that Carbiz is something that would rival a CarMax/I don’t think we ever really succeeded as much as we wanted to until we’ve actually built it to be larger. Now, as we sit here today, we’ve built a brand that’s nationally recognized—more so regionally—but we’ve got a little bit of ways to go as we continue opening up points, which we are: we’re opening up our Washington, DC store in the next couple of months.
We feel as though the brand is what’s allowed us to really maintain, even during low points. The current used car market is really tumultuous. We’re coming off of record new car sales year after year that peaked in 2016. Well, when new car sales peak and when lease volume is up over year after year, that puts out used cars in the market, however long those leases were, however long peoples trade-in cycles are. We’re in a period right now where there is a saturation of used cars in the market.
We’re really never going to always be the lowest priced car. We just can’t be for a number of reasons, one of them being that we probably don’t buy the same quality of car as what the smaller lot or dealer might buy that sells it and that is going to be the lowest price. But we give consumers the brand, the reputation, and all the value propositions that we do, and that is what has kept us moving along.
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