Tag: DMS

Dealer Management Systems 101: A Comprehensive Guide for Dealerships 

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A powerful Dealer Management System (DMS) goes beyond basic functionalities. Often overlooked as a mere ‘basic necessity‘ of modern franchise dealership operations, the technology driving the data within your business operations needs a powerful ‘brain‘ to keep the lights on. This extraordinary solution helps dealerships overcome operational chaos and achieve remarkable efficiency. In this article, we’ll delve into the unique features and benefits of your DMS, providing insights that reveal its true potential for transforming your dealership’s success. 

What is a Dealer Management System? 

Your Dealer Management System is more than just a tool; it’s the cornerstone of your dealership’s operational strategy. This robust software platform integrates various functions, enabling you to manage inventory, sales, customer relationships, and financial operations seamlessly. By consolidating these critical processes, the DMS behind your dealership’s operations not only enhances efficiency but also provides a strategic advantage in a competitive market. It is an essential component for any dealership aiming to thrive against the competition.  

What are the Benefits of a Dealer Management System? 

Unlocking the full capacity of your dealership requires more than just crunching numbers and organizing data; it demands a strategic approach where the Dealer Management System acts as a catalyst for growth. Beyond the traditional tasks of payroll management and month-end processing, a cutting-edge DMS offers a multitude of benefits designed to refine and elevate every aspect of your operations. From streamlining workflows to enhancing customer experiences, let’s explore how embracing these advantages can redefine your dealership’s success: 

  • Enhanced Efficiency: Automates routine tasks and centralizes data, reducing manual labor and errors, allowing more time for strategic decision-making. 
  • Improved Customer Experience: Provides real-time data, enabling dealerships to understand customer needs and tailor services, leading to faster responses and higher satisfaction. 
  • Increased Profitability: Streamlined operations and better customer experiences lead to cost reduction and repeat business, positively impacting the bottom line. 
  • Better Inventory Management: Improves regulatory compliance and reporting capabilities, further enhancing financial performance. 

What Does a Dealer Management System Do? 

A DMS serves as the nerve center of a dealership, coordinating operations by managing inventory, processing orders, and forecasting demand to prevent stock issues. It also facilitates sales and customer relationships by tracking leads and interactions for personalized marketing. Additionally, integrated accounting simplifies financial tasks, while parts and service management, human resources, and regulatory compliance work together seamlessly within the system. 

How Does a Dealer Management System Work? 

Your Dealer Management System leverages automation and data integration to streamline dealership operations. It connects departments, shares real-time information, and breaks down data silos for better collaboration. With automation, your DMS handles tasks like inventory tracking, sales lead management, and accounting, while coordinating parts orders and service scheduling. By improving inter-departmental communication, it aligns all team members with your dealership goals for a seamless experience. 

Which Dealer Management System is Right for Me? 

Choosing the right Dealer Management System requires a tailored approach, taking into consideration the unique needs of your dealership. Factors such as scalability, usability, integration capabilities, support and training, cost, and customization options should all be carefully evaluated. 

  • User-Friendly Interface: A simple interface minimizes training time and ensures smooth implementation, making it easier for your team to adapt.  
  • Integration Capabilities: Seamless integration with third-party systems or legacy software maintains continuity and maximizes efficiency.  
  • Support and Training Resources: Essential for empowering your team to use the DMS effectively and to facilitate ongoing learning.  
  • Expertise and Collaboration: Partner with professionals to ensure the DMS integrates smoothly with your existing operations, helping you make an informed choice 
  • Customization and Flexibility: Allows adaptation of the software to your dealership’s specific needs, aligning with your values and long-term vision.  

The right DMS technology will help your dealership stand out from the competition while maximizing profit potential—now and in the immediate future. Discover how dealers are finding opportunities despite the top five challenges you face. Download the eBook today. 

It’s Time to Raise Your Document Storage Standards

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Dealerships manage thousands of documents over the course of a single calendar year, not to mention the many historical documents they’re required to keep. According to an annual report from NADA, a single vehicle purchase can involve more than 40 separate documents. And that adds up. Dealerships combined to sell nearly 14 million light-duty vehicles in 2022. (That’s a lot of documents, to say the least.)

Document management is a necessary part of doing business, but storing and retrieving these documents has always been a chore. It’s a time-consuming, manual process that leads to security issues, repeat work, and lost or duplicate documents.

As consumers opt for more digital purchase experiences and compliance requirements continue to impact the industry, dealers need to raise their document management standards to ensure security and stay compliant.

Document Centralization

Managing documents is more difficult when they’re stored in multiple places. Important assets are handled by multiple people and/or entities, and when it comes time to retrieve them, dealerships have to deal with a variety of storage vendors. Even digital documents are commonly stored within each individual dealership software solution, leading to uniformity issues and compliance concerns.

When it comes to document storage, the best practice is to have one centralized location for every single document. This simplifies organization, ensures uniformity, and improves document search and retrieval. A centralized storage solution also integrates across the entire dealership, so dealers can keep every document uniform and indexed as part of the same deal workflow.

Document Automation

Manually managing documents is time-consuming and cumbersome. Physical documents can literally and figuratively fall through the cracks and storing them can be a huge expense. According to NADA, dealerships spend $20 in labor just to file a document, and $100 to $200 more if that document was misfiled or has to be reproduced. Instead of relying on multiple, non-integrated processes to store documents, dealers should look to implement automated document capture.

When a dealership produces a document, it’s automatically captured and stored as a natural part of a deal workflow. Automated document management also ensures that every type of document—whether it’s a deal document, a financial report, or just an image from the service lane—is always indexed to the same customer profile for easy retrieval.

Document Security

The security of consumer information is paramount. Protecting consumer information has been underscored by recent federal regulations, forcing dealers to implement additional security plans and protocols in order to become compliant. As deals become more digital and instances of fraud more frequent, dealerships need to double down on their document security efforts.

In addition to these more practical benefits, automating document management into a single dealership storage repository ensures compliance. It gives dealers the ability to manage documents in a secure location while keeping track of retention on a customer-by-customer and case-by-case basis. This also allows dealers to safely and securely retrieve and view documents until individual retention policies expire.

Document management is becoming a big deal in the auto industry. As dealerships evolve into a new digital age and document security becomes even more paramount, it’s time for dealers to raise their document management standards, collectively and individually. Automating and centralizing document storage increases efficiency and ease of access, while also ensuring security and compliance.

READY TO MOVE YOUR BUSINESS BEYOND BUSY WORK? KEEP YOUR MOST IMPORTANT INITIATIVES FRONT AND CENTER WITH NEW SOLUTIONS FROM DEALERTRACK. LEARN MORE.

 

Focus on the Future of Automation

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Most dealerships I talk to are hyper-focused on building a better business for their employees and customers. The most successful automotive groups I work with are always one or two moves ahead. They’re putting in the work to make sure the tools and technology are streamlining workflows so they can focus less on the busy work and focus more on their customers and staff. It’s not always easy. But the tools and capabilities exist to ensure the success of your business—and with the right partner at your side, you can most certainly get there. If you’ve partnered with a DMS who has your best interests at heart, they can help you get there. Here are some of the key areas of focus—in my experience—that will ensure the overall success of your dealership.

Focus On Delivering a Better Payment Process

Simply put, you need to take a hard look at the number of slow, manual processes taking place at every transaction, payment process, and accounting capability within your business. And then modernize it. Conveniences like point-of-sale and contactless payment in our day-to-day life are normal and expected everywhere else—why shouldn’t they be expected within your service lane? If you can both improve cash flow to your dealership via email billing services and get paid faster, why wouldn’t you? I would take this concept one step further (if you’re not convinced) and explain that automation and digitization of payment processes not only will reduce human error, but also creates digital receipts for all your transactions. Everything a dealer can do to protect themselves and improve accuracy is a major win in my book.

Focus on Digital Documentation

As we’ve seen over the past several years in the automotive industry, compliance and security rules are becoming stricter. In my opinion, this trend will continue to the benefit of both the dealer and the consumer. Protecting yourself as a business is going to require you to become more and more diligent as contracts and transactions are digitized. The good news is that, with the right DMS partner, you should have the ability to sync back your data every time you engage with your customers. Whether you’re capturing signatures automatically within the DMS or auto-filling form during the financing process, you’re not only offering more convenience for your buyer, but you’re also creating a (digital) paper trail that helps protect both parties. A secure document management solution will streamline your workflows and simplify your back-office operations. Compliance and fraud risk are real issues that are, unfortunately, a matter of when, not if, they will occur for most dealerships.

Focus on the Data That Matters Most

The daily data battle has long been an issue for dealers. I don’t need to remind you that your DMS is a gold mine of information that can help you make informed business decisions now and in the long run. But knowing which reports to run and where to begin to optimize efficiency without wasting your time can save countless hours. First, if you’re not partnered with a business consultant who has your best interest at heart, I feel for you. A Performance Manager with years of real dealership management experience can hold your team to task on things such as data extraction, KPI tracking, and goal setting. Are you tracking your Effective Labor Rate in the Service Department? How are you managing your contracts in transit in the business office? Are you using Dealertrack Digital Contracting to improve your cash flow? While everyone likes to review information differently, your DMS has the data, and your Performance Manager can help you manage it.

Focus on People Power

In my experience, staff turnover continues to be one of the biggest challenges for dealers, whether times are “challenging” or not. In fact, last time we checked, a dealership will need to rehire and retrain over 80% of its sales team every year. Your back-office team has a difficult job. Hiring and onboarding are only part of their role. If you’re considering optimizing any one key area of your dealership this year, it needs to be your HR and Payroll. Tax laws, compliance rules, and payments get beyond complex the more your business grows. As you add rooftops and expand your business, your needs will grow—and change—consistently. Your investment in this area will pay off immensely if you can integrate the technology you use into your people solutions as you make onboarding more professional.

Technology is never a “set-it-and-forget-it” process. Fortunately, the technology capabilities exist, today, to adapt. My team is constantly learning how to empower our dealer partners and set your dealership up for continued success. If you’re interested in learning how to optimize and streamline, your Dealer Management System for the future, reach out today.

Ready to move your business beyond busy work? Keep your most important initiatives front and center with new solutions from Dealertrack. Learn More.

 

About the Author | Jade Mitchell, Sr. Manager of Client Performance Management

Jade Mitchell is a Sr. Manager of Client Performance Management who works with dealerships to maximize DMS utilization, as well as drive processes and profit improvement. Jade believes that the Automotive Industry is a game of inches in today’s world, so taking a deep dive with our dealers into their financials and processes by using the data that the DMS provides can make a huge impact on their success. Jade came to Cox Automotive in 2019 after working in automotive dealerships for over two decades. He started washing and detailing vehicles when he was only 13 years old which led to him becoming a finance manager at a very young age and spending the next decade in management. In addition to his passion for the Automotive Industry, Jade runs his nonprofit organization: Stay Positive Stay Aggressive Inc, which he established in 2013 to assist local families struggling with medical bills due to life-threatening illnesses. Recently, Jade and his wife Aubrey welcomed their first child into the world so between Dealertrack and daddy duty he is truly working 24/7 these days.

 

 

A Technology Partner That Won’t Hold You Back

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Technology should propel your dealership forward, not hold it back. Too often, however, new tools are so complex, so hard to learn, and so slow to provide support that they actually do more harm than good. DMS platforms have earned this exact reputation—that of a technology tool that brings businesses down rather than bolstering their success.

For a tool so central to your dealership’s operation, that level of performance is entirely unacceptable. Dealertrack DMS is different, as demonstrated by the experiences of the dealers in this video, all of whom found Dealertrack to be easy to use and easy to learn—even for new hires and legacy teammates. And, because the company provides a level of product support that is unmatched in the industry, Dealertrack is as easy to work with as it is to operate.

Efficient Connections and Smooth Conversions

In today’s connected world, technologies must be evaluated for their ability to integrate with other tools. Switching to an open platform allows for natural connections and easy integrations with a wide variety of third-party platforms. When you work with an open and transparent DMS partner who works easily with the vendors of your choice, you can reduce the costly integration fees other providers charge. Still though, no matter how well it connects with your other tools, switching to a new DMS can be nerve-racking. Most of the dealers that switch to Dealertrack, find the transition to be smooth and surprisingly seamless.

Easy-to-Use Interface

Your DMS touches every department and every process within your dealership. So any effort spent working on – or working around – your DMS is energy that could have been used to build up your business. Dealertrack DMS is rated the #1 easiest-to-use dealer management system, so your team can put more of their energy and effort toward things that actually make a difference. Because it’s so easy to use, dealerships that make the switch reach full productivity faster. And, because new hires pick up the system so easily, you’ll never have to make a hiring or retention decision based on DMS experience again. Instead, all of your team members – from the newest to the longest-tenured – will be taking advantage of its powerful capabilities.

Technology holds the promise of productivity, powerful processes, and more profit—but not all tools actually deliver on that promise. Technologies that are hard to learn, hard to use, and hard to troubleshoot can actually hold your business back. As the easiest-to-learn, easiest-to-use DMS in the industry, Dealertrack DMS delivers on its promise to make your business better.

READY TO LEARN MORE? VISIT HTTPS://US.DEALERTRACK.COM/DMS/ AND GET A DMS THAT DOESN’T HOLD YOU BACK.

Make the Move to a New Dealer Management System

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The technology you use to connect your dealership operations is like a lifeline. So, it makes sense that a decision to move to a new Dealer Management System is a big deal. For many dealers, making the transition to any new technology is a difficult decision. Disruptions in work and business are just the tip of the iceberg regarding the many fears that can hold people back. Overcoming the fear of change to your daily workflows and access to data goes even further. Fortunately, the dealers in the video below, found the process of switching to a new DMS was calculated, supported, and guided by a team of experts. Furthermore, once they made the switch, they found a technology partner invested in their success beyond the switch.

 

Technology That Doesn’t Hold Your Team Back

New tools and tech often sound glamorous to people with purchase power. But they can also carry an intimidation factor that causes anxiety to your entire staff. If you’re considering a new technology as integral as your DMS, be sure to weigh the pros and cons of its user interface and useability. If your new hires and legacy teammates are unable to learn how to use your DMS, you’ll have an even bigger issue on your hands once you make the switch. Dealertrack DMS is rated the #1 easiest-to-use, so your team can reach full productivity faster and employees can take advantage of its powerful capabilities.

Access to Data Shouldn’t Cost More

Businesses can’t operate without access to the data and insights that help them see the bigger picture. With drill-down reporting, real-time data, and remote access to information when and where you need it, you can make the best decisions for your business. Unfortunately, some vendors hold your data hostage. Dealertrack DMS is backed by Cox Automotive, giving you access to the most powerful source of truth in the automotive industry. In fact, our open system is built to enable reliable, affordable connectivity to your best-in-class preferred vendors. Our open platform allows for third-party integrations and pairs easily with the vendors of your choice, reducing costly integration fees other providers charge.

Ready to learn more? Visit https://us.dealertrack.com/dms/ and start demanding more from the technology driving your dealership.

 

 

Build Your Service Experience and Maximize Every RO

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With fewer cars coming off the factory line and inventory shortages continuing to impact dealers, more car owners are keeping their cars longer. While this trend is less than ideal for new car sales, it presents a real opportunity for your service department to boost dollars per RO and increase profits. Garry Shirley, Performance Manager at Dealertrack DMS, recently sat down with a diverse panel of dealers to discuss a shift in focus toward fixed ops. (Watch the discussion here.)

Building Rapport with Service Departments

Improving the service experience and maximizing every RO is every dealership’s North Star. But Gary Shirley wanted to find out how thriving dealers were actually making it happen. The Dealer Principals and Managers who participated in our panel shared real-life tips and strategies that delivered measurable results for both their bottom line and customer satisfaction. Key to their success was investing in new ways to offer a more personalized approach to service by utilizing every customer’s service history data. Additionally, using both photo and video communication in the service process kept customers engaged and increased the “trust factor” between parties.

Watch the discussion here and check out the new resource center for more tips and insights on improving the service experience and capturing more revenue in your service lane.

Sustaining Profitability Through Operations and Sales

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Between ongoing talent and inventory shortages, operating a dealership has arguably never been more challenging, and it doesn’t seem to be getting any easier anytime soon. With more competition for cars and qualified employees, dealerships have to do more to sustain profitability by improving operations.

Garry Shirley, Performance Manager at Dealertrack DMS, recently sat down with a panel of dealers to discuss key ways to improve operations and stay competitive in a changing automotive industry. (Watch the discussion here.)

Tips for Optimizing Operations

While sustaining profitability is an ongoing effort for business owners, no matter the current challenges, recent challenges in the automotive industry have put considerable stress on retaining talent and hiring for key positions in the service lane. Another topic trending for General Managers is the ongoing inventory shortage. How do dealers keep their sales team operating at peak performance when inventory remains low? In discussions with high-performing franchise dealerships, Gary found it often comes down to uncovering the right metrics and utilizing reporting in order to stay competitive.

Even the basic building blocks of a dealership require attention to make sure they’re operating smoothly. See how thriving dealers are keeping their sales and operations sharp in order to sustain profitability.

Watch the discussion here and check out the new resource center for more tips and insights on staying profitable in today’s competitive market.

 

 

The Dealer Who’s Different Demands a DMS Who Cares

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Making the move to a new Dealer Management System requires careful consideration from the stakeholders at your dealership. When evaluating the technology that houses the data driving your business, your entire staff will be affected by making the switch. For the team at Greg Hubler Automotive, who made the switch to a new-to-market DMS in early 2022, the promise of a better experience for both their guests and their people was reason enough to leap into the unknown. However, when the promise from their vendor was under-delivered and their employee morale took a big hit, Matt Lohmiller, VP of Operations, was ready to pull the plug. Greg Hubler Automotive is a different kind of dealer—one who truly values its people and its guests. Here’s their story.

A DMS Partner Who Lives Up to Their Promise

A few months after implementing their new DMS, Lohmiller received feedback from his team that things weren’t on the up and up. “I was going to potentially be losing some team members if we stayed (with the other DMS) …and I couldn’t have that.” Employee retention and satisfaction have always been key components of what makes Greg Hubler unique. While going through multiple DMS switches within several months isn’t ideal, Lohmiller took careful consideration from his team and decided to switch to Dealertrack DMS. After hearing their input, it was clear which direction they wanted to go. “We had to make the change,” he recalls.

A Partner Committed to Their Success

A key benefit of making the switch to Dealertrack DMS was the ability to observe the implementation process first-hand and compare the difference from Greg Hubler’s previous provider. The switch to Dealertrack DMS was more streamlined and the level of support “has been great, all around,” said Lohmiller. “Even after the implementation team has left, we have a Performance Manager we can reach out to any time.”

For the people at Greg Hubler, the difference has been night and day. The change enabled ownership and management to keep their promise of being a different kind of dealer—one that listens to team members cares for customers and prioritizes people.

Looking for a DMS who matches your values? Read Greg Hubler’s full story here. 

Making the Switch to Your New DMS

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Changing technologies might be the right move for your dealership, but it’s never an easy decision. Many dealers hold off switching to a new Dealer Management System for fear of disrupting workflows and downtime. It’s not a decision that any dealer takes lightly, which is why it’s so important to find a DMS partner committed to helping you every step of the way. Watch this video and discover why making the move to a more flexible DMS was worth the switch for these real-world franchise auto groups.

Trusted Partners

Your DMS provider should be invested in your success. When it comes to the time for installation, your new DMS team should be on-site, ensuring that your dealership has everything it needs to succeed. That means answering your questions, ensuring that every employee is up to speed, and employing industry best practices for data migration and installation.

Ongoing Support

Once your installation is complete, your new DMS partner should help you get the most out of your new technology. Your provider should have an ongoing presence in your dealership, consulting with your teams on a regular basis to improve performance and help enact operational changes when necessary. Because technology and the auto sales industry are constantly changing, your DMS partner should be forward-thinking, providing ongoing support and updates to help your dealership grow, as the industry evolves.

Watch the video below to see how real-world dealers, like you, made a successful transition to a new DMS and DMS partner.

Control Your Data with the Right DMS Partner

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Your dealership’s data is your business, literally. It’s the key to invaluable insights into your customers, your operation, and the overall performance of your dealership. When you’re in control of how you run your operation—and whom you choose to do business with—you not only save time, but you also save money. Find out why dealers like you are switching to a DMS partner with open and integrated solutions. Watch the video.

Seamless Open Integration

Are you spending money to access data you already own? It sounds wild, but certain vendors can and do charge (often hidden) fees just to access customer information. The average dealership now uses up to seven software systems to complete a sale—and that can add up over the course of a year. Most franchise dealers are paying up to $42,000 every year on integration fees, alone. * (Yowza.) A DMS partner who offers seamless integration with bi-directional data flow and third-party software and OEM integration, would speed up processes and save dealers a lot of cash.

Real-Time Insights

How you access your data is just as important as how you share it. Your data should be on demand, not waiting for you the next day after a lengthy overnight download. Your DMS partner should empower you to access your data when you want, whenever you want. With unrestricted data access, you can get up-to-the-minute insight into transactions, account balances, and dealership performances. You have the freedom to make quick, effective decisions at a moment’s notice, with every possible piece of information.

It’s your data. You should be able to access it when, and where, you need it most.

See how real-world dealers, like you, are taking control of their data with a true DMS partner in the video below. 

References

*Avg. $500/month x 7 third-party apps x 12 months = $42,000/year