What Is A Dealership Management System? Does Your Dealership Need One?

what-is-a-dealership-management-system dealership lobby

We’ve mentioned probably a hundred times the term dealer management system here on our website. If you haven’t, you might have encountered its acronym DMS somewhere. What is a dealer management system? How can it help your dealership?

A dealer management system, to simply put, is a software platform that dealers use to manage their inventory. DMS can handle many things, including deals, wholesale, customer information, and many others. In short, it’s a one-stop-shop for your car dealership’s operations.

Back in the day, car dealers needed to have a lot of software tools to do different tasks. Want to check on customer information? Open up a sheet. Want to look at how many cars have been sold in a month? You need another software for that. Want to reach out to a customer? You will need customer relationship management (CRM) software for that. There are a couple more programs you need to install to do other tasks, such as reaching out to lenders and dealership colleagues.

Although we can consider this a more technological approach to handling your dealership business, it’s still time-consuming and, to some, overwhelming. Nobody wants to open that much software to run a business! Aside from that, your computer system will not enjoy all of these programs loaded and simultaneously running.

That is why we have the dealership management system to thank for today. Now, dealerships can do their business within a single platform that only requires one login. As most tasks are integrated within the DMS program, there’s no need for a user to open up many programs that can potentially deteriorate your computers.

Dealership Management System: Beyond Your Computer And Your Dealership

Now that you know what a dealership management system is, you’re probably wondering if a DMS can only work within the corners of your computer, that there’s a limit to what it can do. Not a lot of people know if that DMS operates beyond that. Truth is, it may not even work without the help of the Internet.

Like most programs nowadays, a dealership management system needs the Internet’s help to operate and maximize its processes. For example, when you need the DMS to send a message to either a client or a salesperson, you need the Internet to send it. Another example is when you sell your vehicles online (which you totally should), it’s crucial to have your DMS connected. The list could easily go on.

Now that we’ve talked about clients, we’re going to talk about how DMS can help you sell vehicles. With the integrations that come along with it, you now have your own selling platform over the Internet. Your dealership’s inventory is automatically sorted out and organized on your website. It may come with all the info a buyer needs to know. Suppose you have a full-detailed vehicle condition report. In that case, it makes it easier for buyers to learn more about your vehicles even without seeing them in person. This way, buyers would be informed and make a wise purchase even at the comfort of their own homes.

What Features A DMS Has

There are so many dealership management systems out there, offering a multitude of features and services. Needless to say, each of these DMS varies, depending on their system. However, most DMS comes with similar core features, including deal structuring, inventory management, and buy here pay here (BHPH) management. While the ones mentioned beforehand are basic, some DMS offer more premium features such as online marketing tools and website integration features. Although they are not cost-effective, these features can be quite an investment for your business, be it on time and revenue.

Below are some of the core features dealership management has and how it can ease your business.

Vehicle Deal Management

This feature is the most basic of all DMS out there. Without this feature, you cannot consider it a DMS. The dealership management provides a platform for your business to structure a deal. This feature usually comes with many tools that can help you ensure you have the right information to optimize the best possible deal. Some vehicle deal management allows credit applications to connect customers to a number of lenders and financing institutions conveniently.

Customer Management


No need to pull out the cardholders or the phonebooks and meticulously sift through the pages to find the right customer. Customer management keeps customer information and allows you to reach out to them right then and there. You can either call or send them a message using the DMS. Apart from that, you can also pull up customer information, log conversations, and organize your contacts to know which ones are a go and which ones are a no.

Inventory Management

Imagine you have a dealership that has more than a hundred cars in the inventory. That’s a lot of cars to put on your plate – figuratively and literally. With the inventory management that dealer management systems provide, you can take a look at all of them without spending too much time walking around. You can place all the vehicle records within the program and easily pull a record or two off in just a matter of seconds. You can also keep track of your reconditioning and flooring expenses. Lastly, with this tool’s help, you can quickly provide book values such as NADA and KBB. You can also provide history reports to sites such as Carfax and AutoCheck.

Does Your Dealer Need A Dealership Management System?

There’s no other way to put this but YES, your dealership needs a DMS in this day and age. In fact, we suggest that all types of dealerships should have one running in their system. Whether you’re a franchisee, a BHPH, an independent, or even a car auction, running your business through a DMS can make every transaction and task much faster than usual.

Yes, you may have been in the business for so long and your revenues may have come so far, year after year. However, in this age of quick and affordable information, you need to keep up. Your dealership may be one of the most popular ones in the area, but your competition will always have a strategy to keep up with you and the rest. One of the critical components of modern dealerships is a good DMS to cut time and expenses.

Also, as a business, you may want to keep track of your finances and taxes. You don’t want the tax people coming after you, right? So, to keep the internal revenue people at bay, you can hire an accountant to do the books. Either that, or you can use a DMS who will keep records of everything financial. Although a DMS can handle your revenues and taxes, it’s still best to get an accountant for more accurate reports.

Benefits Of Using A Dealership Management System For Your Business

If you have come this far reading this (thank you very much), then you would have gathered a lot of advantages of using DMS for your dealerships. However, we’d like to make it easier for you. That’s why we listed down the many benefits your business can get when using a dealership management system.

Better Organization

Most businesses can be chaotic when not appropriately managed, car dealerships included. Simply take a look back in the day when all they got are mountains of papers for both customer and vehicle information. Thank goodness that is all in the past now, and we have computers to take care of all this information and keep it hidden from everyone. Now, with the use of DMS, dealerships can make organizing tasks much faster and easier. Plus, you can pull the data you need anytime, anywhere, using your phone and laptop.

Efficiency

Without dealership management systems, you may have a very grueling day time at the office, right from the start of your shift to calling it a day. Your day may consist of listing down vehicles for upselling, spending hours looking for the customers in the phonebook, roaming around your inventory to check on each car, and manually type the information down. That isn’t the case with a DMS. Using the software, you can now work on these tasks with efficiency while cutting costs and time.

More Chances Of Saving And Selling

Dealership management systems guarantee that you may save time when you do your management using their software. This promise would have a significant, positive impact on your finances. First off, since you’re not really moving around quite a bit, you would be able to save from mobilization expenses. Since everything is done in your PC unit, laptop, or phone, you can save a lot of paper.

Also, a DMS lets you blast your inventory in all directions. You have your list on your website, complete with all the vehicle information you need. This gives the buyers the impression of the legitimacy of your business. When you can be easily reached through the CRM, and be able to do transactions online, bringing in the revenue is a lot faster.

So… What Is A Dealership Management System?

Simply put, it’s all you need to keep your car dealership business afloat in this fast-paced and momentarily strange time. What can help your DMS better? A DMS software tool that makes your dealership management system a lot better. This tool can help your DMS provide more efficiency with its car recon tool (tracks reconditioning process), valuation tool, and complete vehicle condition report for that total package. Click on the link to know more about this DMS software tool.

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