How Does Dealership Management Software Reduces Business Cost

A common perception among the general population is that automotive dealerships are flowing with money, given the size and value of their inventory. While the sentiment isn’t entirely wrong, it’s important to remember that dealerships have to shell out a lot of money to procure cars, ensure its safety and hand it over to the customer.

After all, maintaining an inventory of cars is no cake-walk and requires quite a lot of planning and moolah to keep it up and running. Consequently, the cost of keeping the doors open becomes quite high and can become a financial nightmare for the dealership management authority

A dealership cannot do away with the costs stated above, as these are necessary expenses that drive business. But there are other ways in which it can minimise expenses for lower business cost. The solutions range from using a dealership management software to cutting down on excess supplies.

Let’s dig in, shall we.

4 Ways for Dealerships to Reduce Business Cost

Automate your Administrative Functions
Run Periodic Inventory Clean-Ups
Cut Down on Excess
Go Digital

Automate your Administrative Functions with Dealership Management Software

Imagine you’re building a house of cards. Every card is stacked on each other with accurate precision while keeping the physics of it in mind. The smallest mistake in alignment can cause it to tumble and collapse, in its entirety, leading to a complete waste of your time and effort. That would suck, wouldn’t it?

In the instance above, your dealership is the house of cards and you’re its architect. The smallest mismatch in any of its operational functions, and the whole dealership goes haywire. To prevent this from occurring, you should consider automating your administrative operations with a dealership management software. To put it in perspective, if you were to apply glue to the edges of the cards and then stack them, the likelihood of them collapsing would be reduced, significantly. A dealership management software is the glue in the above metaphor: holding dealership operations together in a tight and compact manner.

A dealership management software automates different processes like report generation, bookkeeping, sales tracking and history, etc. It simplifies a dealership’s important verticals like accounting, inventory management, sales tracking and CRM, into an automated solution that requires less time and manpower to operate. This in turn saves dealerships the hassle of employing more people to keep their administrative functions running smoothly.

eMsys’s AutoNet is one such dealership management software that lets dealerships keep a check on their operational expenses by running a tight automated system. Apart from the aforementioned features, AutoNet has separate modules for managing vehicles, workshop, spare parts, accounting and marketing. Each of these come with uber detailed features which handle the a to z of dealership management.

Run Periodic Inventory Clean-Ups

We already know the impact of dealership inventory management on overall operations. Inventory management allows a dealership to be smarter with its storage and keep a better track of stock movement. Most importantly, inventory management helps dealerships in identifying financial pain points to reduce business costs.

Let’s say you have 100 cars in your inventory at this very moment. Of these, five cars have been in storage for a very long time and show no signs of customer interest or market viability. It makes no sense for a dealership to continue keeping the cars as they are a maintenance liability.

Plus, they take up valuable space in your storage area, which could be used to keep cars that people want to buy. It is important for dealerships to conduct such periodic inventory clean-ups to identify non-performing stock and then formulate plans to dispose/sell them to make space.

Cut Down on Excess

Office supplies are important but it can become a costing nightmare when your dealership starts to buy more than they require. It might seem like an exaggeration but most companies don’t realise the financial impact of office supplies.

Every dealership needs to vet their requirement and compare that to consumption, to identify the excess. This would help in long-term cost saving for the dealership. Consider buying office supplies in bulk with lower pricing. Additionally, there’s always extravagance in every office that can be eliminated to save costs. Your dealership doesn’t need a fancy coffee maker when a normal one would suffice.

Go Digital

Speaking along the lines of cutting down expenses, consider going digital and minimising paper-based work to a minimum. Paper costs a staggering amount of money to a business and a big chunk of it often goes into trash- either as misused or unused sheets. Paper wastage is also an environmental disaster and reflects poorly on your brand image, should people find out.

Digital technology progression has allowed businesses to migrate from paper to devices seamlessly. You should consider doing the same as not only would it reduce the cost of paper but also auxiliary expenses like pen, papers and even trash bags. With the help of tablets, laptops and mobile phones, your staff can easily make notes, write down points and perform all other activities that would typically require a pen and paper.

Additionally, you can also minimise paper consumption in billing by generating digital invoices. There’s also a brand image advantage of minimising paper consumption at work. You can market yourself as an environmentally-conscious dealership that cares about trash generation and carbon footprint. It might not seem like a huge deal but you can use it as an add-on USP for your brand and give it an edge.