KEEPING ITS FIZZ DR SODA SUCCEEDS AS OTHER ONLINE DELIVERY EFFORTS FIZZLE.

Byline: Brent Hopkins Staff Writer

PACOIMA - As high-profile online convenience services implode brilliantly, dashing the hopes of investors and dooming themselves, a former golf caddy and a handful of high school graduates are only getting better.

Their outfit isn't high-tech, they boast no snappy uniforms or delivery vehicles, and their top seller is just plain old Coke. Yet Don Rubenstein and his 15-person crew at drsoda.com are beating the odds and growing their business.

``I started off in 1984 with $350 out of my garage in Panorama City,'' Rubenstein said. ``I never had an employee before 1988, just me. We're not magicians or anything, just a bunch of hard-working people.''

This hard work seems to be paying off. With competitor Kozmo.com already having gone under, Webvan's stock hovering near 16 cents per share and PDQuick forced to rein in its aggressive expansion plan, Dr Soda's profits are growing.

``I made it my goal for the first quarter this year to be our best ever, and it was,'' he said after auditing the books of his privately held firm. ``Our business went up 22 percent over the first quarter last year, and that's a conservative estimate. I'd be surprised if it doesn't double over the year.''

Most of Dr Soda's competition found itself in trouble by casting their nets too wide, according to e-commerce analyst Jeetil Patel of Deutsche Bank Alex. Brown Inc. Shoppers who'd traditionally go to the grocery store, he said, are still going, unconvinced of the necessity of home delivery. And by trying to expand to multiple locations, they were unable to get enough shoppers in each spot.

``With companies like Webvan, that are focused on a city-by-city basis, it's hard to build a critical mass of buyers,'' Patel said. ``There's enough people who live in each city, but it's too hard to build a customer base quickly. Lots of companies overextended themselves into too many markets.''

This stands as a polar opposite to Dr Soda's plan of starting small, building loyalty and making sure to keep an ear attuned to customer demand.

``We listen, we know what the customer wants, and we all work together,'' Rubenstein said. ``If we played softball, by damn, I bet we'd be impossible to beat.''

Darla Postil, a Westlake Village retiree, first signed on with Dr Soda for business but continues to use it for the personalized service to her home. Rubenstein still delivers cases of bottled water and Diet Pepsi Free monthly, and provides supplies for Postil's parties.

``He's great. I don't have to schlep cans and bottles and stuff,'' she said, popping open a soda can. ``It's more personal than just going over the Internet. If you have a special order, he'll go out of his way to make sure you get it. I hope they never go under.''

Though the majority of Dr Soda's business lies in Los Angeles and Orange counties, the company offers shipping of hard-to-find items worldwide. He's shipped Tab to Japan and unusual orders come in weekly. During an interview, he found himself momentarily interrupted. ``Hang on. I've got someone in Hawaii looking to buy some Diet Rite.''

It's been an unconventional path to success for Rubenstein, who first broke into the soda biz as a Coca-Cola deliveryman in Texas. While working the unpopular office delivery route, he noticed inefficiencies in the system, leading to unhappy customers and unfulfilled orders.

``Back then, you went out to the offices, took orders and ran back out to the truck, praying you had whatever they wanted,'' he recalled. ``I figured there had to be a better way.''

He eventually devised a system allowing clients to order ahead of time, allowing him to stock his van more precisely. Soon, the dead-end route was booming, and Rubenstein was ready to move on. He headed West, but fell on hard times.

``I ended up homeless, but I was right in the parking lot of the Los Angeles Country Club,'' he remembered. ``But that was good for me, because I was surrounded by some of the most focused business people in the world. I've always been a very motivated person, so pretty soon I was caddying, then before long I was trying this out on weekends.''

He started with beverages, cold-calling businesses and offering them cheap deals for their break rooms and complimentary food displays. Corporate customers praise the service for both its price and ease of service.

``It's almost the same price as retail, but I don't have to go to the store,'' said Noah Saxe, a partner with Saxe, Roth, Dokovna, Schwartz & Lynskey, a Van Nuys CPA firm and 15-year client. ``The convenience is unbelievable. It's so uneconomical to send someone out to go get stuff.''

This is where Rubenstein hopes to succeed, not beating out warehouse stores on price, but taking the hassle of shopping out of clients' hands.

``We're in the service business,'' he said. ``I can't sell you time, but I can save it for you.''

Though he seems to be doing well, Rubenstein's seen his share of slip- ups. In 1991, he launched Coffee Direct, an ill-fated catalog venture offering hot beverages to companies. It tanked miserably and he now calls it his worst failure. Undaunted, however, he combined his Internet savvy and pre-established customer base and began again as WideAwakeCoffee.com in 1999. Combined with its soda sister company, the two are working out quite well for Rubenstein and crew, who share profits in a company-wide bonus program.

``I actually like failure more than success, because it teaches me more,'' he said. ``I love when I screw up, because it means I must be getting close to getting it right.''

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(1 -- 3 -- color) Dr Soda founder Don Rubenstein says he has shipped Tab to Japan and works hard to satisfy customers' unusual orders.

The online delivery service Dr Soda offers its customers more than just beverages, such as its own brand of these crackers. Below, a forklift in Dr Soda's Pacoima warehouse helps speed delivery of beverages and other products to customers' homes.

John McCoy/Staff Photographer