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Dealer Software Defining Car Speak

What is a DMS – Dealer Management System?

Components of a Modern DMS

A dealership management system (DMS) or auto dealership accounting system is a bundled management information system created specifically for the automotive industry and especially for  car dealerships or large dealer groups.

Some DMS's are OutdatedDMS is not for everyone, typically small scale dealers and independent used car lots will manage their business with generic accounting packages. Even large dealer groups will outsource parts of the DMS to achieve higher quality products.

A typical example of outsourcing is inventory management. In most cases dealers are using companies like VAuto, VinSolutions or Dealer Simplified.

Another reason dealers are outsourcing is that many of the traditional DMS systems are outdated or the dealership cannot afford the massive upgrade charge. It is just less expensive to keep the basic accounting package from their DMS and bolt-on modern software such as CRM and Dealer Web Sites.

Dealers need software to support all aspects of running a dealership such as:

  • Tracking vehicle inventory
  • Tracking sales
  • Finance and insurance calculations
  • Dealer websites
  • Menu selling systems
  • Tracking
  • Accounting
  • CRM
  • Wholesale management
  • Internal company websites and message centers
  • Calculating employee commissions
  • Purchase order tracking
  • Parts inventory
  • Auction management
  • Work order management
  • Appointment scheduling
  • Proper planning
  • Follow-up

Most Common Dealer Management Systems found in dealerships today are ADP, Reynolds and Reynolds and Dealer Track. However many new DMS systems have arrived on the scene in the past few years and are offering easier integration and connectivity with software partners with modern API’s and SSL Keys.

# of Dealership using Non-DMS add-on's
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Defining Car Speak Retail Car Lot

Define SRP

What is a SRP?

The Term; “SRP” stands for Search Results Page, a relatively new term in the industry. In the past, before the internet, all you had to worry about was how the front on your lot looked, did you open the hoods and blow up those balloons. Today, drive by traffic is still important, but if you truly want to grow your used car lot, you need to have a real understanding of SRP’s

SRP’s are how many times your car shows up in a search. Example on Autotrader, or even on Auction Simplified when you are trying to wholesale the car, your car must show up in searches results pages or it will never sell on-line. 
Kevin Leigh, Dealer Simplified
Kevin Leigh

Automotive SRP Yes or NoCars Not Showing On SRP’s:

When I speak to inventory managers at dealer groups, I tell them this: “If it does not show, it’ll never go.” And that is not too far from the truth. In the internet search dominated market, if your cars are priced to high or worse yet, you take to much time to get them online, they may as well be sent right to auction because they will age out.

Dave Kaiser our co-founder, wrote a great article about a pricing strategy he deployed at a large dealer group in Buffalo. In this article he talks about price changes at specific times to get the most possible SRP’s while retaining gross. [article on used car pricing]

The Main Question if you Want SRP’s:

The main question you should be asking is:  “Are my cars showing on page one of a search on cars.com autotrader.com etc, when the customer searches.” If not…. It should be a three alarm fire for your used car manager and inventory manager. Fix the problem quickly your your car will age.

One parting comment, even if the car is priced right, you still must have photos a great description and above all the equipment listed. I mean every time. Having missing photos in this day and age is a sin. Listing a car on line without a price is the cardinal sin. I have found only one exception to listing a car with no price; when you want the car to be bid on, using a tool like Car Auction Widget (available from us) but even then you need a starting price for it to be found on the SRP

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Car Auction Defining Car Speak Retail Car Lot Wholesale Lot

What is the ACV – Actual Cash Value?

Used Car ACV

Understanding A.C.V

The “ACV” is the “Actual Cash Value” the dealer places on the  vehicle purchased either at auction or as a trade in. This simply means the car dealer could liquidate the vehicle for that amount. In other words, if dealer chooses not sell the customer’s trade-in as one of their pre-owned cars, they could wholesale it to another dealer and receive that cash value.

ACV is a live value that fluctuates with the market. For example if a Mustang convertible is purchased in the summer, when it is desirable, it will fetch more then if it is sold in the winter.

ACV vs. Trade Allowance

What exactly is the difference between A.C.V. and trade allowance or trade value then? If neither trade allowance or trade value represent what the dealer actually books the trade into inventory, then why do they even quote those figures? In many cases the dealer needs to quote a figure in terms of the trade that is acceptable to the customer. The customer might tell the dealer that unless they get $12,000 for the trade then there is no deal. In order to put the deal together, the dealer might give the customer the $12,000 as a trade value, but the A.C.V. might only be $9,500. That means there is a $2,500 deficit between the A.C.V. and the trade value which means there has to be a $2,500 concession on the new (or used) vehicle purchase. So even if the customers paper work said $12,000 as far as a trade value, the booked in value to the used car inventory is only $9,500. Another way to look at this is the $2,500 came off the new car price.

Feel free to ask questions in the comment section below. or contact us at Dealer Simplified

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Defining Car Speak

What Does Bloatware Mean?

The Easy CRM is not BloatwareWe love the term called bloatware because it describe how software has devolved into a series of ridiculously complex and overbearing buttons and clicks.

Our goal at Dealer Simplified, is to prevent our software developers from creating buttons and features that are never going to be used. Utilization is everything in our mind, software that is overbearing and complex will never be used. When you have a piece of software that is only 10 or 20% utilized you’ve wasted your money.

bloatware (uncountable)

(computingSoftware that is overpacked with features and therefore slow or unwieldy; software that is inefficiently designed and occupies an excessive amount of space and is very difficult to use.