Dealer Management Systems Archives - cox-content-hub.go-vip.net

How a Technology Switch Helped Goode Motors Keep Growing

Posted on August 8, 2018April 22, 2024

The moment a dealership realizes that its legacy DMS can’t keep up with business growth, everything changes. Suddenly, there’s a crossroads between hanging on to the familiarity of the past and embracing the promise of the future. But while the prospect of growth can be exciting, the transition to new technology isn’t always easy.

Bridging Past and Future Success

Opening its first store in 1917, Goode Motor Auto Group was the very first Ford dealership in Idaho. Over the years, the dealership witnessed the introduction of dealer management technology in the industry, as well as tremendous business growth. Since that first Ford store, the company has expanded to include four locations and multiple franchises in the Southern Idaho area. But like many dealerships, Goode eventually outgrew its legacy DMS. They started experiencing reporting difficulties, including problems obtaining information about car sales and customer visits. But, problematic DMS transition attempts left Goode Motor reluctant to make another change.

After researching several new providers, Goode Motor finally found what they were looking for in Dealertrack DMS—a seamless switch and the promise that technology would keep up with their ambitious plans for business growth. Before, during, and after the switch, Goode Motor’s employees received on-site training and a single, stable point of contact for all support, training, and system utilization needs with Dealertrack.

Partnering with Dealertrack DMS, Goode Motor found the reporting capabilities, connected integration, and easy-to-use technology they were looking for. And the seamless transition from outdated DMS to cutting-edge technology was delivered as promised. Making the switch to Dealertrack DMS allowed Goode Motor to bridge the divide between their past and future growth, paving the way to success for generations to come.

Overcoming a Reluctance to Change

Like Goode Motor, many dealerships get to the point where they must decide whether to stick with their limited legacy DMS or boldly move forward with future plans. This pivotal point, though scary, is an essential part of business growth. Despite some initial discomfort, finding the right technology and the right partner can bridge the divide between past, present, and future growth opportunities.

To learn more about Goode Motors successful technology transition, click here.

Why Dealers Get Stuck Using Outdated Technology

Posted on July 11, 2018April 22, 2024

The auto retail industry is made up of thousands of forward-thinking business people who have found success by adapting to changing environments. These industry leaders have endured downturns, adapted to imposing regulations, and evolved to become the results of natural selection in the marketplace. But when it comes to technology, even enterprising auto dealers can get stuck in their ways and afraid to change. The fear of change is real–and it seems even more real when your current DMS provider threatens to increase prices if you don’t resign or promises functionality ‘in the future.’

Fear of Change Management

With so many advancements in technology in recent years, many dealerships have become reluctant to switch their dealer management systems (DMS), despite the short-term and long-term benefits of upgrading. After all, technology touches every aspect of a dealer’s operations. And one wrong move could spell trouble for an entire business. In other words, with a decision as monumental as changing technologies, it’s easy to see why so many dealerships are apprehensive to make a move.

Fear of Losing Familiarity

Many dealerships are reluctant to change simply because they fear losing familiarity with their old systems and the effect that new technology might have on company culture. There’s no doubt that switching technologies has a huge impact on employees. Especially when dealerships have operated the same DMS for years, even decades, that technology, however outdated, becomes a part of the identity and culture of the business. And the idea of changing identities in the business world can be a frightening prospect.

Fear of Installation and Data Loss

For all intents and purposes, the DMS is the brains of a dealership’s business. It’s the glue that holds dealerships together. It harbors information so vital to the success and continuation of a business it could be fatal if the information isn’t converted seamlessly to a new system. Even if a different DMS would be better for business growth, many dealers are afraid to make the leap and can’t be bothered with a DMS install.

Getting Past the Fear

In truth, switching to a new DMS isn’t nearly as painful as most people think. In fact, most dealer groups report consistent satisfaction in several dimensions of operational improvement. These include efficiency gains, overhead savings, reporting advantages, improved customization, and faster financial closings.

As dealerships depend on their DMS platforms more than ever to stay profitable, those that find ways to leverage technology and take advantage of upcoming trends will outpace the competition and become the next generation of industry leaders.

If your dealership is interested in learning more about overcoming the fear of change, download our free guide, Overcoming the Fear of Technology Transition: Methods for Managing a Successful DMS Change.

A Dealership’s Digital Ecosystem: Insight into Technology of the Modern Franchise Dealer

Posted on June 27, 2018April 22, 2024

Did you know that the average car dealer needs 7 different technology solutions to run their dealership? The once simple and straightforward business of selling cars has transformed into a complex ecosystem of interconnected and interdependent parts. And while technology has certainly become indispensable, there’s also room for improvement at many dealerships.

Dealer Dissatisfaction

In a recent survey of more than 200 senior leaders at different franchise dealerships, only 20% of respondents had no complaints about their current technology. That means 8 out of 10 car dealers are at least somewhat unhappy with their technology.

The Value of Technology

Nearly every dealer uses a dealer management system (DMS) or customer relationship management (CRM) software. In fact, almost 99% of dealers use a DMS and nearly 93% use a CRM. And, unsurprisingly, nearly all surveyed respondents said that their DMS and CRM were the most important systems to their businesses. Still, dealers expressed the lowest satisfaction and loyalty rates for these two systems.

Considering an Upgrade

With so many dealers expressing at least some dissatisfaction with their technology, 53% of respondents said they evaluate their systems and consider a technology upgrade on an ongoing basis. About 25% said they consider upgrading with declining value or persistent problems. And 18% said they evaluate when contract expiration is approaching. Only 4% perform such evaluations on an annual basis.

Selecting Software

In selecting new software, dealers tend to look for vendor familiarity first. They also consider contract terms, ease of training/implementation and vendor reputation. Surprisingly, only 1.7 out of 7 dealers said they look for product benefits and features of new technology. When asked how they’d like to see their technology improve, dealers named integration, ease of use, support, reporting, and flexibility as the top five factors.

Time to Consider an Upgrade

Overall, survey respondents felt that merely improving their current technology wasn’t enough. Rather, they’re looking for the future of technology with more enhancements and mobile capabilities.

If your technology is slowing you down, it’s time to rise to the challenge of integrating new technology. To read more dealer survey insights and learn about the role technology plays in the modern franchise dealer, check out our infographic.

Fight Back Against Margin Compression

Posted on June 20, 2018April 22, 2024

Margin compression is taking a toll on the auto retail industry. Dealerships across the country are reporting slimming margins, with some even experiencing negative overall gross profits. And the problem isn’t going away anytime soon. Yet no matter the cause, dealerships can either choose to ignore margin compression and continue business as usual. Or, they can choose to fight back, finding ways to outsmart and outmaneuver margin compression with a few tricks of their own.

Finding Better Ways to Do Business

The secret to fighting margin compression is to find alternative ways of generating profit. And dealerships must think outside the box of the traditional sell-more-cars-to-make-more-money approach to business to recoup their missing margins. In general, dealerships can focus on seven specific practices to fight margin compression.

Fixed Operations – When other sources of revenue run dry, service lanes offer a steady stream of customers and renewable income. By placing a strong emphasis on customer service and retention, and doing a better job of creating awareness of their offerings, dealerships can win back customers that have left for the convenience of corner quick lube shops.
F&I Sales – A dealership’s F&I office is where retention is built and future relationships with customers secured. Plus, dealerships retain a larger percentage of each dollar generated through the sale of prepaid maintenance plans and other services than through the sale of cars.
Process Improvements – Through cost and expense control and other business improvements, dealers can sell cars more efficiently to recoup profits lost to margin compression.
Holding Cost Expenses – Time is money for dealerships. The longer a car stays on the lot, the more money it costs a dealership. By removing inefficiencies in the vehicle reconditioning costs, dealerships can improve profit margins.
Employee Training – By maintaining close interaction with employees, and conducting better, more thorough training, dealerships can correct costly mistakes caused by human error and sell cars closer to MSRP.
Digital Retailing – In today’s environment, it’s become almost necessary to move at least part of the car-buying experience online. The shift to digital retail allows customers to do a lot of front-end work in the car-buying process, saving dealerships time and money.
New Technology – Implementing a modern dealer management system can reduce dealership waste and increase profit by streamlining operations. And a modern DMS that provides real-time data allows a dealership to scrutinize each deal and track margins over time.

Margin compression isn’t going away. But by focusing on alternative ways to recover missing profits, dealerships can avoid the negative effects of margin compression and continue to grow their businesses. If you’d like to learn more about how dealerships are fighting back against margin compression, download our free guide, 7 Solutions to Margin Compression, Strategies for Preserving Dealership Profit Margin.

Communicating Helps Soften Change

Posted on June 13, 2018April 22, 2024

Successfully integrating new technology at a dealership is a daunting task. It’s more than just adopting new software. It involves operational changes, contemplation of compatibility issues, and buy-in from the entire dealership team. Although changing technologies can be challenging, proper communication can help soften the sting of change.

Communication with Leadership

As with any major decision, it can be difficult to get everyone on the same page with new technology. That’s because even if every member of the leadership team has the same end goal in mind, the steps each department must take to get there sometimes involve competing interests and viewpoints. The key to getting leadership on board is to explain how new technology will benefit each department and employee. And once there’s buy-in from leadership, the process of taking the message and benefits of change to the rest of the organization becomes much easier. Share your vision with leadership and be upfront about the realities and challenges of change. Then, invite managers to help employees understand the vision, again highlighting ways that new tech will make their jobs easier and more efficient.

Communication with Employees

Integrating new technology can be especially jarring for employees, whose lives will change as a result of having to learn new processes and programs to complete their jobs. And that means emotions are involved, creating a natural tendency toward pushback. But with leadership on board, it’s easier to get buy-in from every employee. Remember, these are the people who implement your operational processes and will be most affected on a day-to-day basis by a change in technology. You want to make your employees’ work lives happier and more enjoyable, while at the same time improving efficiency across the board. It’s your job, along with your leadership team, to convince them that a change in technology is for the better. Because when your employees are on board, your dealership is in a position to take full advantage of new technology.

Communication with Vendor

Finding a tech partner that’s willing to facilitate communication among staff members can be invaluable. Before implementation, work with your tech provider to discuss requirements unique to your dealership. Then ask your provider to tailor training and communication with staff accordingly. During implementation, your tech provider should be on-site to provide support and help to ensure that there are no interruptions in operations. And after going live, communication with your tech provider’s performance managers and ongoing support team will ensure that you stay focused on meeting your business milestones.

Implementing new dealership technology is no easy task. But proper communication between leadership, employees, and technology vendor can ensure that all parties move forward together for the betterment of your business. If you’d like to learn more about ways to communicate as a part of change management, download our free guide, Real-World Advice for a (Practically) Painless DMS Transition.

The Future: Open, Integrated Systems

Posted on June 6, 2018April 22, 2024

The Internet of Things is here. Consumers are starting to expect that their refrigerator can talk to the stove and their GPS knows where to take them based on calendar appointments. These innovations require software services and devices to communicate with different systems. With open systems comes efficiencies, convenience, and ultimately a better customer experience for all of us. That same logic applies to the technology stack in a dealership. The modern dealership needs all their software solutions—more than 8 per dealership on average—to communicate with each other without the need for custom code, integration fees, or downtime.

Open Platforms Comes to Automotive Retail

What does that mean for car dealerships and their technology stack? It means that a more effective and expansive way of selling and servicing cars starts with sharing secure data, accessible between key partners—all via an open platform.

Indeed, a perfect example is the experience at Big Two Automotive Group. Fed up with their DMS provider’s lack of service and capabilities, they switched to Dealertrack DMS and soon discovered that the power and immediacy of an open and modular platform was required to keep their operation thriving.

Overall, the Group moved toward an open and accessible platform to run their operation due to several key benefits, including:

Quick access to relevant data: The ability to apply data in real time made decisions more fluid and efficient, meeting customer expectations and helping to create a more productive and nimble environment. For example, data such as customer information, vehicles, and VINs, employees, parts inventory and transactions (ROs, deals, parts tickets, etc.) can help to do one very important thing: use data to better meet the needs of customers and create process efficiencies.

Common system versions for all employees: Having all employees—from sales to service and accounting—on the same version helps to ensure accuracy, reduce confusion and the cost of miss-timed upgrades.

Availability for all important vendors and services: The concept of dealer control and open access to ALL vendors creates efficiencies across the entire group. This is perhaps the most challenging aspect to open and accessible platforms: it must be secure enough to protect the dealership, yet open to all third-party sources of information and service. It’s also an area in which dealers are often taken advantage of, by vendors seeking to charge them for the use of their own data. It’s vital that dealers retain control of their own data!

Convenience of integration points that matter: Integrated data across vendors and store systems helps to eliminate manual data entry – such as name and address – as well as provide timely and proactive reminders about service and more. Of course, remember too that the point of integrated systems is to work with humans to provide better-than service through technology. In fact, a recent study by Price Waterhouse Cooper found that the majority of consumer wanted integrated and automated technology to improve the human customer service experience – not replace it.

Big Two Automotive Group discovered that closed systems and restrictive policies were about as effective and convenient as roll-up windows on cars. Indeed, most retail operations are now realizing the same thing: closed systems symbolize the status quo and a static and frozen picture of automotive retail—not the evolving and growing reality of the business.

Learn more about open and integrated DMS systems in this blog post, Demand More from your DMS: Open Integration.

Invest in New Technology with a Purpose

Posted on May 30, 2018April 22, 2024

Today’s consumers are always on the lookout for the latest and greatest. When something feels old or outdated, it’s quickly replaced with something else that’s new and exciting. This is especially true with technology. But, as dealerships search to find advantages in a competitive marketplace, it’s important to incorporate new technology with a purpose, and not just for the sake of getting something new.

Keep Strategy in Mind

Too many dealerships make strategic decisions based on the limits of their technology. This is a backward approach to business that allows technology to dictate everything from operations to hiring new employees. Every decision you make, including the decision to implement new technology, should be made with your business’ core strategy in mind. To define your strategy, ask how your dealership is different than your competitors. It might be based on size, amount of inventory, or quality of customer service. Whatever makes your dealership unique, find ways to leverage your advantages and use technology as a tool to accomplish your goals.

Ensure a Smooth Tech Transition

Even when a tech upgrade is obviously needed, dealerships should take steps to ensure a smooth transition. These steps include:

Getting leadership on board
Researching and choosing the right vendor
Building implementation partnerships
Managing continuous learning

There are emotions involved in change management. And, getting leadership on board and choosing the right vendor the first time will help you get buy-in from every employee. It’s important to share your vision of how new technology will benefit the business. Then, start researching vendors with your long-term goals in mind. Find a provider that’s willing to help you get the most out of your tech investment. Partnering with a team you can trust—one that’s committed to the ongoing support of its product—will help your dealership reach its goals.

Pull the Plug on Outdated Tech

If new technology will help your dealership get better at what it does best, it’s time to embrace change. Incorporating new technology with a purpose, and not just for the sake of getting something new, can help your dealership find a real, lasting solution that will propel your business forward.

If you’re ready to learn more about ensuring a smooth technology transition at your dealership, check out our guide, Pointers For A (Practically) Painless DMS Transition.

A Dealer-Focused DMS

Posted on March 16, 2018April 22, 2024

Original article written by Paul Whitworth, Senior Vice President of Dealer Management Systems at Dealertrack

What does it mean to be a dealer-focused DMS?

Two years ago, Dealertrack DMS reframed its strategy to focus on being the High Tech, High Touch DMS. So what does that mean? In short, it means that we are focused on the client. Our customers—dealerships just like yours—are at the center of the way we develop technology and the way we offer our services. Of course, we don’t believe that dealers are regularly raving about their dealer management systems, any more than we expect our neighbors to tell us about their amazing washing machines. In a way, the DMS is an appliance. Dealers count on it to be there and to perform its function while they focus on building and running their businesses.

So, in addition to providing a full set of capabilities, what does a High Tech, High Touch DMS do that is special? How is our focus on our dealership clients apparent in our products and services? There are four main things that make us different. Our DMS is open, intuitive, and easy to use. Finally, we aim to be easy for dealerships to work with.

Dealertrack DMS is Open

Automotive retail has become very competitive and, increasingly, innovative technology is being used by dealerships to differentiate themselves. Our open system allows dealers to work easily with a broad range of solution providers. Dealers pick the solutions that they need to win and can count on Dealertrack DMS to integrate those solutions into the rest of their systems. We want you to do business your way, not ours. Dealertrack DMS is giving dealerships the freedom to pursue their own unique strategies rather than forcing them to do things just like everyone else.

Dealertrack DMS is Intuitive

Similarly, a client-focused DMS doesn’t become a central issue in dealership personnel decisions. With employee turnover at an all-time high and the traditional dealership workforce getting older, dealers need more freedom to hire the best people for their business. Dealers need to be able to select candidates based on their skills in the areas of customer service, selling, technology, and management. Too often, however, they are forced to make hiring decisions based on prior DMS experience. To remove the need for prior experience, Dealertrack DMS has developed an intuitive user interface that employees, regardless of background, can learn quickly.

Dealertrack DMS is Easy To Use

Beyond our intuitive interface, Dealertrack DMS is easy to use across a number of dimensions. The platform is fully web-based and works across all types of devices. The system features simple navigation and thoughtful design, limiting the number of clicks required to complete an action. Finally, the system aligns dealership tasks into natural workflows so that employees don’t need to jump between screens or enter the same data twice.

Dealertrack DMS is Easy To Work With

Perhaps the most important part of our High Tech, High Touch approach is our commitment to become a true partner. By definition, a client-centric DMS must make it as easy as possible to do business and to leverage technology. We believe we are the clear leader in this area. Here are just a few examples of things we are doing to put the dealer at the center of our product and service offerings:

We offer simple upfront pricing with no long-term contracts.
We are deploying DMS 360—an online community and user portal to get our users the answers they need to do their jobs quickly and easily.
We provide Performance Managers: proactive coaches to help clients better use our software and improve their businesses.
We introduced DMS Edge virtual user conferences and DMS Controller Conference.

When it is time to upgrade your business, be sure to examine the goals and objectives of your technology partners. Look for a company that puts dealerships at the center of its operation. And, please take a look at Dealertrack DMS, the only High Tech, High Touch dealer management system.

Paul Whitworth, Senior Vice President of Dealer Management Systems at Dealertrack, has been at the forefront of automotive retail technology advancements his whole career. Paul graduated from the Massachusetts Institute of Technology and has held positions with J.D Power & Associates, Accenture, Hyundai Motor America, and Cox Automotive as well as leading several start-up companies.