Four years ago, Bank of America's Floyd S. Robinson saw a need to use the Internet to streamline RV dealerships' floor planning.
So Robinson, as president of the bank's specialty group — which, among other things, finances recreational vehicles — launched an online floor plan management system for RV dealers.
After he also became head of the bank's Auto Group in 2000, “I felt a similar application could be applied to auto dealerships.”
So, Bank of America is launching Floor Plan Online, a free service that's intended to increase dealer efficiencies in floor plan financing and inventory control.
The password-protected system allows dealers 24-hour access to their floor plan lines of credit. That saves time and money, according to Robinson, president of Bank of America Dealer Financial Services.
For example, it facilitates paying-off vehicles as they are sold, avoiding additional interest.
Dealers can view and print current statements, pay interest or pay off vehicles, retrieve prior months' statements, and track every vehicle on their floor plan.
More features will be added soon, says Bank of America's Taty Williams.
“We talked to a lot of dealers while developing Floor Plan Online,” she says. “It's built on dealer feedback.”
Having dealers involved in the design, “made it intuitive and very easy to use,” says Ron Tye, regional financial officer for Hendrick Automotive Group in northern California.
He says his dealerships' accountants adapted to it quickly during test runs preceding the system's rollout.
“They were well-trained in less than an hour,” says Tye.
The new system poses advantages and disadvantages to the bank, according to Robinson.
An advantage is that it helps dealers, and that helps the bank build a stronger relationship with them.
But Robinson adds, “Financially, it's somewhat to our disadvantage, because dealers are moving their funds and receivables themselves. But their financial health is important to us, and that's why we're doing this.”
Dealer feedback in the development stages led to better functionality, user-friendly screens, timely and accurate information and reports that are tailored to match the way dealers need to review information, says Williams.
Once the system was built, 16 dealers tested it for three months. They gave it an overall approval rating of 9.7 on a 10 scale.
“They really listened to what I was saying,” says test group participant Linda Doney, business manager at Michael Stread's Concord Chrysler in the East Bay area of San Francisco.
She adds, “The website is so easy to use, it's a no-brainer. It checks your work and lets you know if there's a mistake — when you send it, you know it's correct.”
Another test group member, Jim DeSilva, worried the system would create additional work. In fact, he says, it saves time by eliminating mistakes that can require a lot of follow-up calls.
“It's a very good cash management tool,” says DeSilva, controller for S&C Ford in San Francisco. “You can check the interest or principal status of any vehicle at any time.”
Robinson says smaller dealerships can use the system as effectively as larger ones. But he foresees the big guys as primary users because they tend to be more Internet-savvy.
Tye, who oversees finances for seven Hendrick dealerships, says, “Before, payoffs were written on paper and faxed to the payoff center. You hoped they got there, you weren't sure when they were entered on the books and there was no receipt.
“Now you submit it, the system receives it and you get an actual receipt.”
He says that for a group like Hendrick, financial timing is important, as interest savings mount up fast when so many vehicles are involved.