Blaine Adair dipped his toes in the automotive industry when he was just 19, working at a small Ford dealership. It was only a two-person operation, but he enjoyed the work, especially selling cars. After he got engaged, he wanted to be able to provide more for his family so he decided to leave the dealership and took a job at a factory.
After a few years, the factory fell on some hard times and Adair was itching to get back into the automotive industry. He decided to take the severance he received from the factory and try opening his own dealership. “I really wanted to get back to doing something I loved and that’s when I decided it was time to open Shoals Truck Center,” Adair said.
In 2015, his first year, he sold about 80 cars. He was cautiously optimistic about being able to bump that number up to 100 cars the following year, but he was operating on a cash-only basis, which was limiting. “If your cash is tied up in your inventory, you don’t have the cash flow for things like reconditioning or maintenance at your lot, so your cash flow is limiting,” he said. “In order to carry more inventory and sell more cars, I realized that I had to have access to more capital.”
He had heard negative things about floor plans from other dealers in the past so he wanted to make sure he picked one that wouldn’t put him out of business. The research was a little overwhelming, but NextGear Capital always rose to the top when he talked to other dealers who had success with floor planning. “What I’ve come to realize is that it’s not floor plans that put you out of business but mismanaging your funds,” he said.
With his floor plan, he now averages about 30 to 35 units on his lot each month. He says that he’s still old school when it comes to purchasing inventory. “I still prefer purchasing in-person versus online but if an online auction has a good post-sale inspection process and policy, I feel comfortable buying online because I know I won’t end up with a bad vehicle,” he said.
Adair said his experience working with NextGear Capital has been fantastic. He especially appreciates the high level of customer service he receives from his Portfolio Manager if he has any questions and the tools are second-to-none.
“Account Portal is always open on my browser,” he said. “It’s very easy to reconcile units, and I love being able to floor non-auction purchases. Another tool I use a lot is the Consumer Loan Program. If someone’s paying off a car that still has a lien on it, NextGear Capital handles the process for me, making it a breeze.”
Like other independent dealers, Adair said his biggest issue is a shortage of inventory. Before COVID, he used to visit only one auction a week and had a couple of wholesalers whom he would source from. Now he’s shopping at every auction he can. He’s also had to adjust his vehicle pricing due to inflation. The inflated prices at first gave him pause, but he nearly ran out of inventory and only had about six trucks left on his lot. Similarly, it took some of his customers awhile to come to grips with the higher prices but once they did, they were ready to sign on the dotted line.
Adair is looking to continue his steady growth over the next few years and said in hindsight he wishes he would have signed up for a floor plan sooner. He now offers advice to new dealers on the advantages of floor plans and how to make the floor plan work for them. “My advice to any dealer signing up for a floor plan today is not to max out your plan right away,” he said. “Just ease into where you feel comfortable because a lot of the negativity surrounding floor plans comes from people who don’t know how to manage them. And don’t buy crazy stuff, just buy what your customers want so you can move your inventory quickly.”