Which DMS is Right for Your Dealership?

DMS Comparison

By: Sandi Jerome

It’s possible you’re facing a decision. Which Dealership Management System will be right for your dealership? Or maybe you’re wondering if the one you just switched to is the right one for you? This can lead to a lot of decision fatigue and second-guessing when you’re investigating all your options and then trying to figure out how to implement them. We’re going to help cut down the time you take to make that decision through this blog.

Every DMS company is under pressure to make money right now - they want you to buy into all the bells and whistles they have within their system. Some of that is due to investors who’ve come on board with these companies, seeing the opportunity for them to expand their services. But that doesn’t mean every feature and capability is right for you or that it will make dealership life easier for you.

When you’re considering a new DMS, we know you are particular about how you want it to run. Some of the Tier 1 systems have a lot of features you don’t need and they can come at a higher cost than other tiers. They are also sometimes slower to respond to new technology. That’s why those older systems might seem “patched together” to you when you take a system for a test drive. But there are some Tier 1 systems that are newer and more responsive for certain types of dealerships. If you know you want a Tier 1 system, and if you have the money to spend on it, make sure you know what you’re signing up for when having the conversation with their sales team.

How will your DMS serve your CRM system? Is it interfaced or integrated technology? This is an important question. Take for instance a customer who is thinking about buying a new car. A great system will allow you to automatically send them an email offering a free tank of gas if they do a test drive, but you don’t want to send this to someone that already bought a car today. These higher levels of integration save you money and go a long way towards better customer service.

You need to also pay close attention to the report writer on the system. Right now, you most likely have access to the main database files, and you can write certain reports based on specific criteria. But some of that may be going away as these companies look for ways to make additional revenue. A great level of service in a DMS will give you the opportunity to filter information and then export the report to Microsoft Excel. And if you want to go paperless at the dealership, you should be looking for up to three levels of report writing.

Do you have advanced features in your current DMS? Let’s give an example- you’re going to sell a small part that’s worth ten cents and you want to sell it for a higher profit margin. Make sure your DMS can do a grid escalation based on cost. Or that you can order a lot of those parts easily using an ordering escalation and never run out. Another advanced feature would be online schedules and generating correcting vouchers, or knowing when an employee is going into an overtime status. Some Tier 1 systems might have these features, but most Tier 2 and 3 systems don’t.

Also, can you run multiple companies out of the DMS? Let’s say you have three dealerships that sit next to each other and they want to share the cost of a large balloon for an upcoming promotion. A great DMS will allow you to debit a portion of that balloon expense from all three dealerships seamlessly instead of complicated accounts receivable charges that cause disputes.

Switching new systems can be tough- and you may be inclined to go back to your old system. But before you do it, ask yourself: Were you treated okay when you left your DMS? Did they help you get your data? Did they have a plan where you could use the system for a few months during the transition? Before you go back to what you know well amid a struggle with the new, it’s important to consider all the above. And truly- there’s more to it. Why did you leave them in the first place? Was it price? Will you get a better price? And has the system improved?

And be honest with yourself- is the new system really all that difficult to use? Employees don’t like change, so don’t make a switch in the middle of a move or when you have had a key employee leave the dealership- like the controller. This system is going to take six months to really be understood by all involved.

If you’re locked into a contract, ask your DMS sales rep if there are ways you can reduce costs. You can get rid of the non-DMS technology like phone systems and proprietary archiving. If an interface doesn’t make sense or gets very little use, getting rid of that can save you money.

There’s a lot to consider in this subject area, and we’ve just hit some high points to help you decide. So, we’ve made it easy with a comprehensive look at what’s happening in the DMS world in a webinar right here.

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