Getting with the program

Amy Malow is shopping for an all-inclusive dealer management system for Jefferson Beach Yacht Sales. With five offices in three states, she envisions a future in which the marine dealership can make its decisions based on real-time data obtained from a fully integrated dealer management system, which interprets all of the operations of its multiple locations through a single management tool.

“The dealer management system is a strategic instrument for planning,” Malow says. “It’s not just how many units we sell and the lead’s street address. It’s so much more for us.”

Malow wants to take the 8,000 records she has in two databases and consolidate them for trend analysis. She wants access to her dealership’s intelligence, its data. Then she wants to take that data and quickly twist it, crunch it, shape it, and ultimately utilize it to keep the company’s business plan and stategies in line with an ever-changing consumer markets.

“In a time when trend analysis is critical, to have our valuable data at our fingertips instead of merging multiple systems is important for our high-end market,” she says. “It takes too much time and effort now. We are tracking everything but not from one place efficiently. Do we see any trends from 600 leads? What segment should we direct more effort to? Is one Sunseeker model getting more leads than another? How has our average sale changed over time and what do we predict it to be moving forward? In a time when we are making very difficult business decisions, ease of tracking of analyze is more important than ever?”

If fast data access and actionable insight are critical to your company’s profitability, a dealer management system should be in your future, too. It has never been more important to be efficient, be effective and know exactly where your dealership stands.

Considerations: Cost of system, ease of use, training and support
Recognizing that it’s time for a new DMS is a relatively easy first step. But the next – choosing the right DMS for your business – isn’t nearly as simple.

JBYS has a consultant who is helping the dealership determine which Windows-based, user-friendly system would be the best fit and what special programs are required to bring together all leads, customer info for sales promotions, accounting, inventory management and service, all in one place, with access for its multiple locations and business functions.

It’s a long-term project that Malow is several months into with many more to go. She has to pick the right DMS system for the right reasons.

“We need what’s going to work for us,” Malow says. “We won’t spend $15,000 if the system is just okay versus $39,000 for a DMS that is really great. Price is, of corse, a consideration, but what comes with that price? We’re also looking for good customer service with a DMS to asure we can quickly tweak problems or adjust reports as we evolve.”

It’s important to choose a DMS with strong technical support. That’s worth its weight in gold to Nancy Smith, vice president and co-owner of Colorado Boat Center. She tells her staff, “If you have a problem, ask me, but call the support line. We pay for the service.”

It’s easy for a “boat guy” at the dealership to throw a wrench into the dealership’s financials.

“A parts person doesn’t know what a P&L (profit and loss statement) is,” Smith explains. “One person can mess up a lot of things. In an integrated system, all departments filter into accounting. It is great because everything automatically changes everything else. With a crew who knows what they are doing, it goes smoothly.”

Procedures should be established with each employee trained for a specific level of security access. Mistakes can be fixed on the back side. Manual corrections from a general ledger can be performed on the accounting module.

“The key for a dealer is that the system doesn’t go beyond the expertise of staff they have now,” says Alan Bohling, president of Washington-based dealership Seattle Boat Co. “Some move to a system that requires a management degree in accounting to operate.

“A system must have simplicity to understand it. I believe none of us are using our operating system to the level we can use them. We are just on the peripheral of what Dockmaster offers and we have had it for 10 years. We eliminated all hard paper copies of work orders. I bet most dealers still use those in their service department.”

What do you need for your business?
Many dealers don’t think outside the box to well utilize their system. They don’t ask themselves what they want to keep doing and stop doing manually.

Bohling wants to generate contracts electronically, for instance. Many modules can be added on to a DMS system, although it’s important not to get a system with unnecessary bells and whistles.

“Get the essentials, then add on so you are not spending money on modules you don’t use,” Smith advises. “Do payroll, all credit reports, gift cards and credit cards on your DMS.”

This is a fundamentally important consideration: whether the system has the flexibility to allow you to do some custom reporting in-house, thereby avoiding heavy external expenses and errors.

“Make sure the module for service, sales, F&I department or marina can be integrated throughout the system and avoid redundancy entering in systems,” says Rod Malone, president of Texas-based dealership Sail and Ski Centers.

“The ability to have a chart of accounts to handle multiple locations is important,” Malone says. “It is relatively easy from the software standpoint to handle one location, but is more difficult as you add locations.”

Malone likes the benefit of a fully integrated system. When he’s at the dealership’s Austin location, he can see what’s happening in the parts department in San Antonio without a download.

He warns that some DMS companies don’t address multiple locations and modules. Your best reference is a current user if you want to ensure you don’t have to integrate a module as a separate function.

Sales follow-up is a whole other module to consider. This Customer Relationship Management module captures the customer in your database and goes from one location to another, tracking him. If your system isn’t integrated, and you sell a new customer a boat, you’ll need to capture him all over again in the service department if he doesn’t have a history there.

Finally, there’s the decision of whether to turn to a Microsoft Windows-based system. Some dealers like the ease with which you can export data into programs like Excel for analysis.

Where is your dealership headed?
Business management systems usually start departmentally: either in sales or parts. Some dealers start with a brown bag accounting system – paying bills when money is in the bag. Others start with QuickBooks and deal with multiple entries and ledgers that are not integrated.

“We converted everything from a paper system,” says Michelle Ayers, general manager of Prince William Yacht Sales.

Quality Boats of Clearwater started at the top and worked its way down. The Florida-based dealership couldn’t justify the nearly $65,000 cost of a top-end system.

“We don’t integrate our whole accounting system,” says Dan Bair, co-owner. “We have Peachtree for accounting software. We have less than 20 employees and $10 to $15 million in product sales. We don’t have storage, so why have a module for storage? Why pay for something you don’t use?”

The question: are you big enough to integrate your DMS into your accounting software or small enough that just entering the data causes more of a problem?

“If you are only selling two new boats a month, Peachtree and QuickBooks can handle this,” says Stanton Murray, president of Murray Yacht Sales. “QuickBooks and Salesforce, together, cover everything.”

If your dealership aims to expand, then look for a system capable of handling integrated systems. But don’t take the decision lightly. It’s a cultural shock for a dealership to adopt a fully integrated system that requires everyone to adapt to a single process versus a single location where there is latitude with modules.

“It was two years of pain,” Malone says. “I questioned it 100 times over two years, but in the long term, it was the best decision.” — BY?Lisa Hoogerwerf Knapp

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