When the economy collapsed almost two years ago, the Detroit Trading Company didn't go down with it. Instead it tweaked its business model, allowing it to adapt to the rapidly changing market and set the stage for some significant growth.
The Southfield-based business developed a technology that gathered, analyzed, and organized Internet sales leads for car dealers. Prior to 2008, the six-year-old company sold them on an open exchange. After the financial markets collapsed and credit lines froze, its good subprime leads were no longer in demand. The company then switched to selling its best leads with the best credit scores to dealer groups who signed on for the service.
"There was no point in buying a lead from someone with average credit when they can't get a loan," says Pete Bonner, senior vice president of Detroit Trading Company.
This eliminated the open market model that depended on volume, rendering several hundreds of thousands of leads worthless. However, the segment with high credit scores was gold in an auto market desperate for buyers.
"All leads are not created equal," Bonner says.
The company has been able to maintain its profitability and its staff of 13 through the recent turbulent waters. It plans to hire 3-4 people within the next year, including a new salesperson and a new programmer.
Source: Pete Bonner, senior vice president of Detroit Trading Company
Writer: Jon Zemke
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