That is the main way to dispose of the car. If the public wants to also make an "offer" they can. But the model is similar to Lending Tree where the dealers bid for your business.
I think that the business-model has to have high conversion for the consumer and dealer.
Dealers are frustrated by "tire-kickers." Lots of wasted money following up on email. We hope to take this up another notch by having a bona-fide consumer walking in with an offer in hand.
I agree the competition can become very stiff in this space.
We're looking to bring in personal data (financial) from Neustar to qualify the seller along with carfax data to verify the quality of the car prior to the bid.
I see having to have some sort of dispute resolution or mitigate that risk like eBay Autos does. Like Gazelle does I believe they have right to modify the trade-in price upon inspecting the gadget.
Serial Founder of SaaS B to B companies. Dealerignition.com; Adealy App (deal of the day app for e-commerce).
Mentor to Ironyard Startups Advisor to Clemson MBA- Entrepreneurship