How To Squeeze More Value from Your DMS With

How To Squeeze More Value from Your DMS
With
Wayne Youngs – Executive Consultant, Dixon Hughes
Moderated by
Mike Bowers – Executive Editor, DealersEdge
Wayne Youngs is an Executive Consultant with Dixon Hughes
PLLC. Wayne specializes in the automotive industry and has been
assisting car dealers with process improvements, data processing
cost recovery, and contract negotiations for the past 23 years.
In addition for the past three years, he has also been helping
Dealers become Gramn-Leach Bliley compliant by doing in-depth
GLB risk assessments that help dealers meet these new identity
security procedures.
He is familiar with billing practices and contracts of major DMS
ADP, Reynolds & Reynolds ,Arkona and UCS.
Prior to joining Dixon Hughes 4 years ago, he spent 3 years with
his own dealership consulting firm and 16 years with ADP the last
14 years as their Director of Sales in the Southwest.
Dealer Services Group
2009: the Year of
“Survival” Mentality
Computer Chaos - What Dealers Need to Know
April 30, 2009
Wayne Youngs, Executive Consultant
Dixon Hughes Dealer Services Group
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Current Industry Overview
Dealer Computer Systems
Vendor Review
Protecting & Using Your Most Valuable Asset
IT Outsourcing (MSP’s)
2009 – Shocker Year
• # of dealerships sank 4.2% in 2008
• Auto Sales at 26 year low
Source: Feb 22nd autoblog
Dealer Survival
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Re-engage in the Dealership
Lead by example
Monitor solutions
Communicate
Maintain positive attitude
Be more hands-on
Survival Tips
• Review past success areas
• Maintain & increase “absorption rate” of the
dealership
• Think “out of the box”
• Review all expense areas
• Review DMS / software applications
• Identify change in processes
Survival Tips
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Review & evaluate all business practices
Review all management roles for consolidation
Focus with profitability tests
Clean existing database for better targeted
marketing programs
DMS Computer Systems
Expectations & Demands for Purchase Process
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Longer selling cycles
Pricing pressures – competition
Incumbents more aggressive
Shorter term contracts
Tougher addendum protections – demand
More creative on positioning deals – flexibility needed
Better discovery – listen to dealership needs
More cost justification to add products & change vendors
Changing Computer Systems
• Know the $ cost to change
• Identify needed 3rd party associations – costs
involved for some DMS providers
• Contracts –Terms & Conditions (know when to sign)
• Vendor responsibility & ownership
• Review monthly computer bills
• Review application & audit equipment
• Consolidation of IT services (MSP)
What Vendors Consultants
Are Seeing
Consistent all deals
Increased Activity
How Consultants Rate Vendors
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Current Products
Installs
Company Flexibility
Sales Force
Terms & Conditions
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Demos
Service & Support
Company Viability
DMS Pricing
Billing – Full Disclosure
Current Products
Criteria:
• Perception of leading edge software – windows
look, touch & feel, diverse products for dealership
needs.
• Addresses all the basic dealership needs
Demos
Criteria:
• Preparation for the demo, following agenda, people
on-site, good listeners onsite or via web-cast,
answer client questions, perceived ease of use,
right people to address dealership needs.
Installs
Criteria:
• Best communication with sales force on install, lead
installer, goes the extra mile for success, listens to
client’s needs, “can do” attitude and makes the
client feel comfortable.
Service & Support
Criteria:
• Phone answered quickly, questions answered
timely, minimum hold time, follow-up when
promised, professional caring approach
Company Flexibility
Criteria:
• Ease in doing business, out of the box thinking,
creative ideas to get the deal, market-share focus
for long term customer (revenue generator).
Company Viability
Criteria:
• Commitment to improvements, addresses weak
area with solutions, hitting committed timeline for
products and under promise and over deliver.
Sales Force
Criteria:
• Ability to address competitors systems as well as
their own, probing & discovery questions, focus on
dealership sensitive profit areas vs. applications,
professional approach and understands dealership
needs and current financial strains.
DMS Pricing (Deals)
Criteria:
• Flexible to address needs of each deal, understands
some dealers front load sensitive-other monthly
sensitive-ability to move gross where it needs to be
to attain deal and creative thinking, no predetermined % pricing
Terms & Conditions
Criteria:
• Understands every deal has different needs, no
cookie cutter approach, creative to address
application short-falls and client fears and needs.
Billing – Full Disclosure
Criteria:
• Ease of understanding – it is what is represented,
addressing credits and over-billings, builds client’s
trust.
Protect Most Valuable Assets
• Database
– Clean it
– Maintain it through processes
– Market to it
• Capture e-mail addresses - department benefits?
• People Training
– Build into contract at time of deal
– Improve utilization
– Negotiate pre-determined costs
What is an MSP?
• Manager over the IT resources
– Hardware, software, telecom, data networks, technology contract
reviews
• Protects and responds to security threats
– Installation & monitoring of security and firewall
• Acts as productivity officer
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Monitoring internet usage by employees
E-mail SPAM filtering
Central help center / tech dispatch
Maintain VOIP phone systems
Finding the Right MSP
• Selection of right MSP
– Local providers - small geographic reach
• Industry experience
– Both dealer industry & dealership technology
– DMS and manufacturers
• Virtual call center or actual service desk?
– Are you calling another country or your contracted vendor?
• Economic stability of provider
– They are getting under your covers, they better be in business
tomorrow!
MSP Benefits
• Consistent security at dealership and employee
level
• Control unnecessary added capital expenditures
• Equipment / software fit with industry AND
dealership
• IT vendor consolidation
• DMS and MSP partnership - validate vendor cost
expenditures
• Consistent software updates
How a MSP Saves $$
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Increased employee productivity
Trouble tickets are handled timely & efficiently
Vendor contracts are managed and reviewed
Decreased IT overhead
Cost savings vary by dealership size but overall value is consistent
regardless of dealer size
Dealer Services Group
• 135+ Dedicated Dealer Services Professionals
• 20+ Members Fully Dedicated to Dealer Services
• 50+ Years Serving Dealers
• 1 Dedicated Dealer Risk Services Group
About the Dixon Hughes Dealer Services Group
The Dealer Services Group of Dixon Hughes, one of the nation’s top 20 accounting
firms, has over 135 dedicated professionals working exclusively with some of the
largest dealerships across the country. Providing our clients with industry thought
leaders in our Assurance, Tax and Risk Service Groups, we consult on best practices to
help maximize efficiencies, decrease costs and understand risk management.
Dealerships need an independent CPA firm to provide an objective view to take their
business to the next level. At Dixon Hughes, we deliver on both sides of the service
equation. A fact you might find a plus.
www.dixon-hughes.com/dsg
Dealer Services Group
THANK YOU
Wayne A. Youngs
Executive Consultant- Dixon Hughes
P.O. Box 3853
Midland , Texas 79702
wyoungs@dixon-hughes.com
For more information
(877) DLR – CPAS
dsg@dixon-hughes.com
www.dixon-hughes.com/dsg