Giving College Kids a Smoother Move How AllDorm CEO Ryan Garman turned a difficult interstate trip into a thriving e-commerce company.
(Business 2.0) – Moving into the dorm on the first day of college is a notoriously trying affair. To furnish their new digs on student budgets, freshmen either brave the lines at the local Target or haul their must-haves from home.
Ryan Garman chose the latter when he enrolled at California's Santa Clara University in 1998. At home in Las Vegas, he packed up a U-Haul trailer--maximum speed 55 mph--and embarked on a painful 13-hour drive with his mom. Upon his bleary-eyed arrival, he checked into a hotel, only to stand in line at 5 a.m. the next day with 2,400 other students. Surveying the circus around him, he had an epiphany: Someone needed to come up with a better way to move into a dorm room. A year and a half later, he approached his three closest friends with an idea for a new business. "When you're in college, you have time to do things well," Garman says. "You can study, you can party, or you can start a company. We chose to start a company."
That company's story reads a bit like a dotcom tale of yore. AllDorm is an online retailer catering to a small niche. It was founded by four college sophomores in a dorm room. Its Silicon Valley offices are decorated with dartboards and mini basketball hoops. But by starting small, holding down costs, and meeting a specific need, AllDorm has thrived, with revenue leaping 500 percent to an estimated $25 million last year. And there's plenty of room for growth: According to research firm Harris Interactive, college students in the United States spend about $210 billion a year. "There are two ways to be successful in e-commerce," says Jim Crawford, vice president at analyst firm Retail Forward. "Operate on a large scale, or find an audience that isn't served by brick-and-mortar stores."
Option two is the thinking behind AllDorm.com, which went live in July 2000. To avoid frantic first-day shopping sprees or hellish moves, incoming freshmen can order gear in advance and have it delivered to their dorms right before they move in. AllDorm offers more than 6,000 items, including beanbag chairs, mini fridges, and shower kits with sandals for trips to the communal bathroom. The company also knows which requisite items are hard to find--like high-quality extra-long bedsheets--and carries plenty of them.
Despite the wide selection, AllDorm stays lean by stocking no inventory. Instead, it maintains links to its suppliers via proprietary e-commerce software; the suppliers then ship products directly to students. AllDorm works with universities to determine delivery dates, because shipments will be returned if they arrive too early. To prevent returns of the voluntary kind, the founders--now at the ripe old age of 24--keep tabs on dorm dwellers by hiring interns from their alma mater and letting them test new items. This strategy keeps costs down and provides constant feedback from the target market. One thing Garman knows for sure: Freshmen nationwide are saying good riddance to U-Haul. -- MICHAEL MYSER