From the Farm Community to the Auto Industry

Glen Callahan, an Iowa farm boy, started Dubuque Data Services in 1972 with $5,280. He and two employees provided accounting and payroll services to farm equipment and heavy-truck dealers. In the early 90s, Callahan realized the farm community lacked growth potential for an IT firm. So he entered the battlefield that is the automotive retail industry. We looked at the potential of that market, and

Glen Callahan, an Iowa farm boy, started Dubuque Data Services in 1972 with $5,280. He and two employees provided accounting and payroll services to farm equipment and heavy-truck dealers.

In the early ‘90s, Callahan realized the farm community lacked growth potential for an IT firm.

So he entered the battlefield that is the automotive retail industry. “We looked at the potential of that market, and it made sense,” says Callahan, president of the firm.

It wasn't easy for little Dubuque to garner auto industry interest in itself or its dealer management system (DMS).

Until the mid-'90s, car dealers had a little choice when buying such a system. There were two, maybe three major players.

Auto makers weren't interested in dealing with several different vendors. So they kept the certification standards private. They only allowed major IT companies access to the dealers.

“It was like banging against a brick wall year after year,” Callahan remembers. He and his crew kept at it. In 1994, they sensed a change.

“I could see some new blood was coming into the auto companies,” says Callahan.

Also, dealers were getting frustrated with high DMS prices. Dealer councils began lobbying manufacturers to allow other companies to obtain certification.

“They wanted competition so they could get prices in line for the technology systems,” Callahan says.

He credits James O'Connor, now Ford Motor Co.'s group vice president for North America marketing, sales and service, for “actually listening to the dealers.”

Ford finally made the certification standards available. In 1995, a Dubuque team went to Ford World Headquarters in Dearborn, MI for the certification tests.

Callahan remembers the stress from that day. “I was back here in Dubuque and was receiving the reports by cell phone each time we passed a test. When it was finally over, it was unbelievable.

“Ford gave us the chance — we devoted 7,000 man-hours to getting Ford-certified. We passed everything on the first test. We knew we had to do it right the first time.”

Dubuque Data is still relatively small with 150 dealership clients. But the company is where it wants to be, says Callahan.

He says the firm has been on the cutting edge of dealership technology systems, being one of the first to offer a completely integrated system to dealers at competitive rates.

A seventh-generation Dubuque system debuts this year. The accounting, parts, sales and service tools are offered as one package.

There is also a finance and insurance tool and appointment setting tool that Dubuque sells as separate modules.

The system is robust but lacks the bells and whistles of some more expensive systems. That is to keep costs down as well as provide a simple tool that's not overwhelming to use, says Callahan.

While many of the other DMS vendors are moving to a Windows-based system, Dubuque is beholden to the Unix operating system because of its stability and security. But the front-end look is becoming more like that of the Windows environment with each new generation, says Callahan.

In many smaller dealerships, office managers and controllers are accustomed to the look of the Unix-green screen. They aren't interested in changing.

But attitudes in dealerships are changing and Dubuque is changing with them. In 2003, the company will offer a Windows-based system for dealers who want it.

TAGS: Dealers Retail
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