How Titusville’s Salvage Direct continues to be a pioneer on the information superhighway.
Back in 1998, the Internet was still relatively new. Companies had just begun using it as a business tool, and no one was sure what kinds of applications it might have to different industries.
Bob Joyce, founder of Salvage Direct, was one of those who had a pretty clear idea of one way it could be used. Joyce was a claims adjuster for an insurance company at the time, and he dealt with specialty vehicles that sold at live auctions for far less than they were worth.
So he had an idea: Why not open up the bidding to a larger audience through the Internet?
His idea worked so well he set up his own company—salvagedirect.com, an eBay-style auction house for automobile salvage that sells to a worldwide network of licensed salvage dealers and auto rebuilders. It was the first company to bring auto salvage auctions online, and effectively created an entire industry in cyberspace. With 4,500 active and registered buyers in 61 different countries, Salvage Direct continues to expand its operations and respond to a growing customer base.
"We have a growth strategy that we're staying on track with and expanding as customers are asking us to go places," says the company's CEO Dan Hoversten. "And that's probably the key to our success…we’re going to where our customers are asking us to go."
The Titusville-based company is known for its state-of-the-art web-based technology that pioneered the salvage industry's first online auction. But lately it has been gaining a reputation as a logistics company for major insurance companies.
"We do a lot more than just sell the vehicle," Hoversten says. "Now we're involved with logistics, titling and preservation. When the insurance company calls, we'll figure out how to get that vehicle towed from where it is and brought over to one of our Salvage Direct lots, where we will store that vehicle for them for 60 or 90 days or sometimes longer."
Salvage Direct also transfers titles, takes photos, and preserves the vehicle—everything from covering up leather seats if the car has a broken window to making sure the engine starts and the keys work. And the company doesn't just handle passenger vehicles, but also boats, large trucks, motorcycles and RVs.
As its capabilities have grown, so has the scope of Salvage Direct's services. In 2003, the company handled its first catastrophic event in Norfolk, Va. when Hurricane Isabel struck. Since then, it has responded to ten such catastrophes, including Hurricane Katrina and Hurricane Ike.
For that operation, Salvage Direct set up a 27-acre salvage yard outside Houston, TX. It is one of nine locations the company manages with its own personnel, including a Cleveland yard it opened in January 2009. For some 83 other yards it uses across the country—wherever there's a demand for its services—the company uses subcontracted network facilities.
Considering its first vehicle sale was in 1998 and its first company-managed salvage yard was established in 2003, Salvage Direct's growth has been staggeringly rapid: About 120 employees, most of them based in Pennsylvania, manage the sale and transfer of some 40,000 vehicles annually, more than 3,000 per month. Their goal for 2009, says Hoversten, is somewhere between 50,000 and 55,000.
"Our business is growing," he says, and in the coming year Salvage Direct will be adding staff to handle an increasing demand not only from its insurance company clients, but also from rental car companies, vehicle consignment sales and nonprofit organizations.