Between everything that goes on at your dealership – from sales to customer service to work orders to invoices – your dealership relies on all its different departments to work together. Today, it’s more important than ever that the tools you use to run your business increases your efficiency and maximizes your profitability; therefore, a dealership management system (DMS) is a tool you might be considering.
If you are wondering where to start your search, you are in the right place. We’ve combined research from hundreds of dealerships about their experience in searching for a DMS and we’ve shared what they found in the process. So let’s get a few important questions answered to start.
What is a Dealership Management System?
A dealership management system (DMS) is a business management software solution designed to streamline and automate operations to help manage day-to-day business activities. However, most systems tend to be generic and are a one-size-fits-all solution for different businesses. These generic options are not equipped to handle more specific needs tailored to your industry, like parts and service management, rental, and sub-rental.
What does a Dealer Management System do?
Think about all the different departments of a dealership – sales, finance, service, customer service, etc. A dealership has many moving parts as well as a unique flow, which is why it requires a tremendous organization to keep the business running smoothly.
Many dealerships still manually track their departments using pen and paper or a punch card system, but this slows down processes and leaves room for human error. As your dealership grows, so does the complexity of your operations. Using different systems for different departments may lead to data silos, where information is stored within different systems and not easily accessible or shared across the dealership. Customers expect timely access to information about their purchases, inventory availability, and delivery times, and if your dealership is unable to provide this information in a timely manner, it can negatively impact the customer experience.
While dealer management systems have advanced significantly over the last 30 years, many industries still lack industry-specific, “all-in-one” systems tailored to their business. Dealers will benefit most from a fully integrated DMS that streamlines all the operational areas of a dealership in one place, allowing the different dealership departments to operate seamlessly.
Who is a DMS for?
Nearly all dealerships can benefit from having an industry-specific DMS. Whether it’s sales, finance, service, parts, or IT, a DMS allows dealers to manage all aspects of their business and reduce inefficiencies between departments. Anyone at a dealership can use a DMS to improve productivity and efficiency, including service managers, accountants, technicians, and more.
Although there are many DMS solutions, you will have the most success choosing the one that caters to your industry specifically. For example, if you’re an Ag dealer, you will want a DMS tailored to your processes, departments, and operational standards. The same applies to Construction dealers, Material Handling dealers, Mining dealers, Outdoor Power and Equipment dealers, etc.
In the end, a computer system will not solve problems – people solve problems; however, if you spend several hours trying to figure out what the problem is, you’ll have less time to fix it. These challenges only grow and become more complex as your dealership expands. Multi-location dealerships may find switching to the right DMS solution will help increase their efficiency and resolve those complex problems faster and more effectively.
What are some of the most important features you should look for in a DMS?
The features of a DMS can vary between systems, but there are still a few standard capabilities that a DMS should have. We’ve provided basic capabilities below to ensure you know what to look for when reviewing DMS options.
A good DMS should have features that enable you to easily handle all your locations, departments, divisions, and business processes. The DMS should be an “all-in-one” solution that can cover the most important areas of your business. These features should enable your dealership to do the following:
- Give your employees access to all the information they need to do their jobs effectively
- Allow dealers to pull up customizable reports in a few clicks
- Seamlessly integrate with your suppliers’ systems
- View live management dashboards and review performance in real-time
A good DMS will be able to automate all areas of accounting, from point of sale to inventory to costing transactions. The accounting of the DMS should be something that’s comparable to what your dealership is currently using or better. Some of the features of good accounting will allow you to:
- Quickly and easily complete financial reports to communicate with managers and employees across all departments
- Create operating budgets, track actual performance, and view the profitability of a specific location or department
- Automatically create all transactions relevant to your unit inventory and sales
- Recall customer history and information for a better customer experience
A DMS with service management functionality will increase the efficiency and profitability of your service department. It will also give you a clear view of your dealership’s service schedule, allowing you to prioritize work orders and meet deadlines. Some additional features that a service management module should be capable of doing are:
- Streamline the service write-up process to make it more flexible and faster
- Schedule service work so that billable hours can be maximized
- Allow technicians to clock in and out easily
- Perform quick and efficient repairs and track warranty claims
- Communicate with the Parts Department for order management
Parts and Inventory Management
One of the most essential parts management capabilities of a DMS is its capacity for OEM integrations. A DMS that provides OEM integrations enables dealers to manage parts orders more effectively. This means that your dealership will be able to interface directly with key manufacturers and aftermarket suppliers to automate order submissions. For example, HBS Systems has OEM integrations with AGCO, Bobcat, BRP, CanAm, Claas, CNH Industrial, Case Construction, Case IH, Krone, Kubota, John Deere, New Holland, Polaris, Skidoo, Seadoo, Vermeer, as well as over 300 shortline and specialty manufacturers.
More than just OEM integrations, a good DMS with parts and inventory management abilities allows your business to track all the detailed service history on any piece of equipment which can be accessed at any moment. It should also be able to:
- Automate parts ordering based on seasonal min/max numbers (possible change below)
- Automate parts ordering based on numerous conditions like seasonal, fast-moving, slow-moving
- Easily transfer parts inventory between stores
- Point of sale functionality to process counter transactions quickly
- Integration with EMV chip-based credit card payments to speed up payment processes
- Provide historical metrics such as inventory turns, past inventory values, and sales performance
- DMS features service management and parts and inventory management
Another important feature of a DMS, which may not be as obvious as some of the others, is fleet management. A good DMS will provide your dealership with a comprehensive fleet analysis, giving full visibility of what is happening with each of your rental units at any location. Some important metrics that a DMS should have to help you monitor and assess your fleet’s performance include:
- Total cost of ownership and return on investment
- Cost per hour
- Efficiency analysis
- Historical trends
Sales and Customer Management
Sales and customer management features in a DMS will help your salespeople maximize the number of closed deals. A decent DMS should be able to provide your salespeople with the ability to:
- Show customers photos of units and products and easily prepare quotes
- Access real-time information about dealer-installed options, internal work orders, etc.
- Access up-to-date customer information from mobile devices using iOS or Android
- Easily build and sell custom order units with standard features and include manufacturer and dealer installed options based on the unique requests of prospects
- DMS features rentals and sales and customer management
- Ability to provide reports totaling customer purchases and activity
The reporting functions of a good DMS will be able to track dealership data for all departments, pinpoint bottlenecks and inefficiencies in your dealership, and generally allow you to maintain a birds-eye view of your dealership’s operations. Most systems have sophisticated reporting features that allow you to measure your dealership’s KPIs and get an idea of how the business is doing in comparison to other businesses in the region or across the country.
For example, HBS Systems has features for billing, accounting, and reporting that would typically take a long time to generate, execute, and deliver. However, the reports available provide customers with:
- Access to a personalized online account where they can automate most of their actions with the dealership
- General overview of their expenses
- Ability to download details on all their units, work orders, and invoices
- Allow customers to see the status of each invoice and make payments
Although many dealers still use on-site servers, switching to a cloud system offers major benefits and is an option that a DMS should be offering. Cloud hosting has many advantages:
- Save your dealership money on computer hardware maintenance, electrical power, and office cooling and server replacements
- Eliminate time spent on regular software updates, back-ups, and failed parts replacements
- Access system data from anywhere on any device as no on-site server is required
- Server and data security, including security against cyber threats like ransomware, and in the case of unforeseen circumstances, you can quickly restore your full business system with no loss of data
Customer Support and Employee Training
Ongoing customer support and training are essential features that a DMS vendor should provide. This gives employees an opportunity to learn about the system and be able to use it to its full extent. It is not enough for a vendor to just sell you the software, they must also be able to provide ongoing customer support and training in the following ways:
- Provide customer support on days and hours that are suitable for your dealership
- Provide training through webinars, online training portals, in-person training, or remote sessions
- Deliver more than one way of submitting and tracking an incident – e.g., telephone, email, web portal
For example, HBS Systems continues to assist your dealership even after installing the software. HBS Systems maintains two fully-equipped training centers: one in our Dallas, Texas headquarters and a second in our Stratford, Ontario office, where your team can learn without the distractions of the dealership environment. This accelerates the learning process and ensures that your employees have the knowledge required to maximize the return on your investment from your new system. Available M-F 7 am-7 pm and most holidays via phone at 800-325-2252 as well as 24/7 via email at firstname.lastname@example.org.
A DMS is only as good as the infrastructure platform it runs on. The DMS team should be able to provide a secure environment for your software and hardware and continue to solve technical issues as they arise. Other aspects to take into consideration when it comes to IT support is to determine whether the DMS does the following:
- Business data is backed up automatically and stored offsite
- System updates occur without the dealer’s intervention
- IT support should always be available to keep your system running properly
Ease of Use
While this is listed at the bottom of the list, it might need to be placed at the very top. A good DMS should be user-friendly and easy to navigate. It should have an intuitive interface that your team can quickly learn and use once trained.
If you’d like to learn more about the dealership management software HBS Systems provides to dealers worldwide, give our team a call at 800-376-6376 or send an email to email@example.com.