In 2003, Phil Klima and his father John started KDK Auto Brokers in Cleveland with a simple goal: sell 20 to 30 reliable cars per month to budget-conscious buyers. Twenty years later, that humble family operation has grown into one of Ohio’s largest independent dealerships, routinely moving over 200 vehicles monthly and outselling 90% of all new and used car dealers in the state.
The transformation didn’t happen overnight. Klima’s journey from a small-lot operation selling $3,000 cars to managing a sprawling 10-acre facility with over 17 years of automotive experience reflects both strategic vision and an understanding of how technology could reshape car buying. His story offers insights into building a successful automotive business while adapting to changing consumer behaviors and market conditions.
Today, KDK Auto Brokers maintains an A rating with the Better Business Bureau and consistently ranks in the top 8% for monthly sales volume across Ohio. But Klima’s path to success wasn’t just about expanding inventory or increasing sales numbers.
Building on Internet Marketing When Others Were Still Catching Up
Klima recognized early that the internet would fundamentally change how people shop for cars. “We started KDK Auto Brokers really in the infancy of the internet age and online marketing as a way to purchase a vehicle,” he explains. While other dealers were still relying primarily on newspaper ads and lot traffic, Klima began casting a wider net through platforms like Autotrader and Cars.com.
The strategy worked. By providing multiple interior and exterior photos along with detailed descriptions and competitive pricing, KDK Auto Brokers began attracting buyers from well beyond their local area. Cars were selling to customers from other states, something that would have been nearly impossible without the internet’s reach.
This early adoption of digital marketing became the foundation for the company’s growth. Between 2005 and 2007, when Klima expanded to a Brookpark location with space for 140 cars, monthly sales jumped to 80-100 units. The business model focused on high volume and competitive pricing, appealing to internet-savvy consumers who were willing to travel for the right deal.
Strategic Relocations and the Push Toward Premium Inventory
In 2007, Klima made a significant move by purchasing a former Nissan dealership in Brunswick. The 3-acre property could accommodate over 200 vehicles and provided the infrastructure needed for serious expansion. More importantly, it positioned the business to move beyond budget vehicles and into higher-end inventory.
During this period, Klima developed expertise across multiple automotive segments. He learned the ins and outs of import luxury brands like Mercedes, BMW, Audi, and Lexus, while also building knowledge around domestic trucks and SUVs. This diversification proved crucial as customer preferences shifted and different vehicle categories experienced varying demand cycles.
The Brunswick location saw phenomenal growth, with monthly sales routinely exceeding 160 units. Klima managed all marketing efforts while overseeing daily operations and maintaining his role as controller. The combination of strategic location, expanded inventory capacity, and refined digital marketing continued driving results.
The 10-Acre Expansion and Streamlined Operations
By 2016, Klima was ready for another major move. He acquired a former Lincoln Mercury dealership on just over 10 acres, directly across from their existing location. The additional space wasn’t just about holding more cars – it allowed for optimizing the entire reconditioning process.
This operational refinement proved critical as sales volumes pushed past 180 units monthly, with certain months hitting over 200 vehicles sold. The streamlined reconditioning process meant cars could be prepared for sale more efficiently, reducing the time between acquisition and sale.
The numbers speak for themselves: KDK Auto Brokers outsold every independent dealer in their county and 90% of all dealers – both new and used – throughout Ohio. For an independent operation competing against major franchise dealers with manufacturer backing, these results represent significant achievement.
Avoiding Common Car-Buying Mistakes in Today’s Market
Klima’s experience processing thousands of vehicle transactions has given him insight into where buyers typically go wrong. He identifies several critical mistakes that cost consumers money and create problems down the road.
Title verification represents one of the biggest oversights. Many buyers assume the seller has clear title or that any title issues will be obvious. But title problems can create massive headaches and financial losses if discovered after purchase.
Vehicle history reports present another area where buyers place too much trust. While services like Carfax and AutoCheck provide valuable information, Klima emphasizes they can only show what was actually reported. Unreported accidents, service issues, or other problems won’t appear in these reports.
- Verify title status independently before finalizing any purchase
- Budget for ongoing maintenance and repairs, especially with European vehicles
- Avoid predatory buy-here-pay-here lots that often trap buyers in unfavorable terms
- Consider total cost of ownership rather than just purchase price
European luxury vehicles deserve special attention when budgeting. While these cars offer advanced features and performance, their maintenance and repair costs typically exceed domestic or Japanese alternatives. Buyers who don’t account for these ongoing expenses often find themselves financially stretched after purchase.
Market Shifts and Current Buying Opportunities
The automotive market has experienced significant changes over recent years, creating both challenges and opportunities for buyers. Klima notes that inventory shortages dominated headlines for a while, but supply chains have largely recovered. This normalization has shifted leverage back toward buyers in many situations.
High new car prices have created increased demand for quality pre-owned vehicles. When the average new car price reaches record levels, more consumers naturally look toward the used market for value. This trend has elevated the importance of finding dependable used cars rather than stretching budgets for new vehicles.
Current oil prices have also influenced buyer preferences toward fuel-efficient vehicles, hybrids, and electric cars. Klima sees this trend continuing as fuel costs remain a significant factor in total ownership expenses.
For first-time buyers, Klima recommends separating emotions from financial realities. Japanese imports historically offer the lowest total cost of ownership, making them smart choices for budget-conscious buyers. When financing, he suggests focusing on the total loan term rather than just monthly payments, as longer terms mean paying significantly more interest over time.
Looking Ahead: Technology and Industry Evolution
Klima expects the automotive industry to continue evolving rapidly, particularly around battery technology, artificial intelligence, and autonomous driving features. He believes hybrid vehicles will become standard across most platforms as battery range improves and technology costs decrease.
Advanced driver assistance systems and AI-powered safety features should become more common. These technologies can monitor driver attention, detect drowsiness or distraction, and potentially reduce accident rates over time. Level 3 and 4 autonomous driving capabilities may become standard rather than premium options.
For buyers considering these technological advances, Klima recommends staying informed through resources like Consumer Reports and Edmunds. Consumer Reports provides long-term reliability data and owner satisfaction ratings, while Edmunds offers comprehensive buying guides and market analysis.
Beyond the dealership, Klima maintains an active commercial real estate business with holdings throughout Ohio valued over $10 million. He also coaches youth athletics and supports local charities. His St. Ignatius High School and Fordham University background in finance continues serving him well across these various business interests.
The growth of KDK Auto Brokers from a 20-car-per-month startup to one of Ohio’s largest independent dealers demonstrates how understanding customer needs, embracing technology, and maintaining operational focus can build lasting success in a competitive industry.
