If you're looking to replace your current dealer-management system vendor, get ready for an extensive and time-consuming process.
Going through the process can be like negotiating your way through a financial minefield.
We've heard the horror stories from dealers paying incredibly high prices for their systems. But there are a number of issues beyond price you should consider before you sign a DMS contract.
You have choices. I'll never tell you which vendor to choose, but I can help.
So here what are some of the key questions you should ask.
Who can access your data and how do they get it?
Some vendors want to control the data and its access. Their concern is protection and security of the data. Their issue centers on allowing third parties who have your permission to access their data through a “pull” data extraction. What if you could “push” the data to a secured web site? Then access to your DMS data would not be an issue! Your third party could then scoop up that data and do what you asked them to do marketing, emails, etc. and they have access to only the data you wanted them to have. So why is this so easy to do with some vendors and not others?
What restrictions are placed on approved third parties who need access to data?
Approved by whom? Well that would be you, of course. But the DMS provider also wants a say. They need to approve the third party to make sure they have the technical abilities to access the file structures of their system appropriately - especially if they if they are going to be doing a “pull” data extraction and/or if they are writing back information to your files that will change/update your data in any way.
What costs will the dealer or third party have to absorb for this data access?
Some of these providers have told me the data “push” model I mentioned earlier is simple and the costs would be “free” to their customers. Others have said that the cost would be less than $1,000 by their best estimates and past experience. Others have said it is not an option! So, wouldn't you like to know where each of these providers stand on this issue? If you work with third parties and they need access to your data, I think your answer would be yes, you would like to know.
What if you plan on selling your store in the near future?
It depends on the contract the vendor offers. Some providers require long-term contracts while others allow for ones that are month-to-month. Of course, the features you receive will vary.
Make sure you understand what you are getting before you sign. Some vendors will be flexible while others will tell you “a contract is a contract.”
These are just a few of the issues you should understand before engaging in your search.
If you're attending next month's National Automobile Dealers Assn. convention in San Francisco, be sure to register for the Ward's/Dixon-Hughes DMS Panel Forum. It will be Friday, Feb. 8, at the Grand Hyatt on Stockton from 1 p.m. to 5 p.m. (The last hour is a cocktail reception).
While you are sipping on your beverage of choice you can mix and mingle with representatives from any of the DMS Panel participants, which include:
- ACS - Automotive Computer Services
- ARKONA - Dealer Track
- AutoSoft International
- Digital Motorworks - Third party data provider
- Reynolds & Reynolds
It is not often when you have the opportunity to visit and compare side by side so many of your DMS choices in one sitting. So if your schedule allows it, attend this session armed with questions you want answered!
CPA Wayne Fortier is a dealership consultant with Dixon Hughes PLLC. He is at 919-876-4546.
Questions or comments about this column? Send us an e-mail at [email protected].