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What are the Benefits of Using Auto Dealer Management Systems? Pt 2

Posted by Brandes Elitch on Mon, Apr 29, 2019 @ 01:55 PM

DMS iconsIn our last column, we talked about the challenges and intricacies of being a car dealer, and along those lines, why a car dealer would need a reliable and robust Dealer Management System (DMS).

The car retailing business is unique. It has a lot of moving parts and there is a lot of money flowing through it every week. The owners and managers need to stay on top of the numbers that drive the business every day, not once a month. The DMS is a kind of supercharged general ledger accounting system that addresses the unique needs of a car dealer. Consequently, you do not want to change DMS or providers lightly; it is a big commitment to learn how to use a DMS and is usually a long-term commitment.

Why Use a Dealer Management System?

To quote Auto Dealer Today, “A DMS should be a system that clearly measures, reports, and controls the functions within a dealership yielding quantifiable, reliable, and timely information of significant importance to the dealer and management.” Principally, this means integration, reliability, and an audit trail. It should be intuitive and easy to use. The platform should be streamlined and seamless. But the DMS should help in other areas, too, CRM contentincluding:

  • Training and installation
  • Customer service
  • Improving customer satisfaction scores
  • Making internal operations more efficient

In the past, a dealer would have to log into separate software systems, for example, to submit deals to lenders, manage their website and online marketing, pull credit, etc.

Today, the dealer wants to manage their business from a single login platform. One example would be a customer relationship management program (CRM): tracking current customers and leads, scheduling appointments, pulling credit reports, filling out credit applications, submitting loan applications, and automatically populating contracts, etc. Another would be tracking used car expenses in reconditioning, flooring expenses, pulling book values from Kelly Blue Book (KBB) or NADA Blue Book, and pulling history reports from AutoCheck and CarFAX.

There are three major DMS companies — CDK (formerly ADP), Reynolds & Reynolds, and Autosoft — and about a dozen smaller ones. Dealers will choose the one that they think is the best fit for them. This is an important decision and everyone that will use the DMS in the store should be kept informed and have a voice in the decision of what features are the most important to them.

Service Department Apps

Today the factory evaluates the dealer on their Consumer Satisfaction Index. If it is good, the dealer gets access to the most popular makes, models, and options, special deals, and can qualify for holdbacks and rebates.

car on rack

For most consumers, the primary contact with the dealer after the buying experience is when they bring the car in for routine scheduled maintenance, or repairs. Consumers don’t like this experience because it seems that they can never get a straight answer from the Service Manager on when their car will be ready and what it will cost. You call multiple times and get voicemail and play voicemail tag and the person you are calling never seems to be at the service desk. This can be infuriating, particularly if you want to return the rental car in the meantime, or are trying to be in a certain place at a specific time and you don’t know if your car will be ready then, or if you have to authorize a needed repair that the shop found when they were inspecting the car.

All DMS include fixed ops in their platforms, but one related business model has built its app around the scheduling and follow-up of service operations. It is called MyKaarma (www.mykaarma.com).

MyKaarma has an installed base of over 700 dealers, which is a pretty good indication that they are on to something important. It is built around a sophisticated platform that handles bidirectional recorded voice, text, recorded phone call, and emails with a single inbox view. It is their secret sauce. This leads to a 50 percent reduction in telephone traffic, and equally important, a 37 percent lift in dollars per repair order because now the service department can communicate clearly as to what work needs to be done now and what it will cost.

The consumer can pay from anywhere too. This is really important to the dealer principal, because dealers make certified auto service departmentmost of their income from what is called “fixed ops,” namely the service department.

For this reason, it is the most critical component of the customer satisfaction index, because you want your customer to keep bringing the car back to you for service, not going to an independent shop down the street. You not only want a customer that is happy with the repair, but you want that customer to come back to your store when they shop for their next new car.

MyKaarma is not a DMS, but it works with the DMS companies seamlessly.

In summary, choosing a DMS that is a good fit for your store, and augmenting it with MyKaarma, would be a win-win for a dealership, large or small.

Additional Auto Dealership Services

And when it comes to taking a payment, the dealer will want to take a check for high dollar service work, because the interchange rate on a rewards credit card will be a big drain on their profit. Fortunately, CrossCheck is there with Multiple Check — a real-time authorization for one to four payments to be deposited from today up to 30 days in the future. The dealer pays a small service charge and knows that they will get paid, without having to worry about a bounced check. The consumer does not apply for credit or pay interest. And the store gets a high CSI score, which helps their relations with the factory. Indeed, a win-win for all concerned.

Download our free guide to learn how Multiple Check can help increase sales and mitigate risk while saving time and money at your dealership.

Happy Motoring from CrossCheck.

hold check, multiple check

Tags: Auto Dealerships