Whether we want to accept it or not, we are in a rapidly changing world fueled by the Internet, ACH, wire transfers, etc., which the financial institutions and other companies use daily. Dealerships use these same methods of cash transactions to fund purchases, pay off vehicle floor plans, and pay liens, sales tax, payroll taxes, license and title fees, credit cards, etc. So whether you like it or not, the world is not going to stop or slow down for you to get off this fast-moving bus.
Buy here pay here (BHPH) dealerships and related finance companies (RFCs) are collecting payments from their customers by setting up automatic transfers for all the due dates of the installment contracts. The customer furnishes the dealership with the necessary bank account information and approves the transfers, normally at the time of sale. This method of cash collections has resulted in large savings through a reduction in collection costs for those dealerships and finance companies. It also has helped decrease the costs customers incur, as they no longer have to drive to the payment facility to make payments. They can stay at home and not worry about anything except if there is enough money in the account.
Many employers have switched to automatic payroll deposits into these same customers’ checking accounts. By timing the vehicle payment due dates to correspond with the payroll deposit dates, BHPH dealerships and RFCs are almost assuring themselves the money will be available to them first. This should help reduce the delinquency of these installment notes and may decrease the number of collectors needed.
Most dealerships now submit most credit applications online to finance companies for approval. Then, they receive approval back using the same method. This has greatly sped up the process of selling and delivering vehicles to customers. It also enables the dealership to quickly submit credit applications to multiple finance sources at once to see which company offers them quick approval and the best profit.
Online banking enables you to check bank account activity, transfer funds between accounts, pay credit cards and authorize other payments to vendors. Dealers can now manage their cash flow more easily and plan accordingly. You don’t have to call the bank every day to check your balance to see if you have enough cash pay your bills.
Scanners have revolutionized document transfers and storage in dealerships. Instead of faxing documents, you now scan them, save them to a file and e-mail them to whomever you want within minutes. No more long distance calls using the fax machine, and the recipient sees nicer and more legible copy.
There are many free programs on the Internet available for download to assist you in archiving your documents to PDF format files. This relieves the tedious, time-consuming process and cost of printing the reports, storing them in file cabinets, moving them eventually to storage boxes and then finally shredding them in the distant future.
Printing your month-end and other reports to a PDF format and storing them on your server or local hard drive normally consumes very little space. Plus, they can be easily named and categorized into appropriate folders for future review and analysis. It allows you to have the entire document at your fingertips, but to only print the pages needed for review rather than the entire document. This saves paper costs along with the storage costs and hassles.
You can purchase a high-speed scanner to archive your car deals and any other documents you don’t want to store for long periods. This is a more costly endeavor as it entails paying someone to stand at the scanner and feed it documents. Some dealerships are employing this method of archiving for specific documents only, such as car deal jacket information. Other dealerships have committed to archiving as much as they can, including vendor invoices, checks, receipts, contracts, etc.
If you think about it, the effect of all this technology has made us a more impatient group of people. We complain if the e-mail we are trying to open takes longer than a few seconds.
Today, technicians in service departments are utilizing laptop computers during test drives to store vehicle data, which can then be analyzed to assist in diagnosing problems and recommending repairs. The laptops utilize wireless networks to transmit the data to the factory for additional analysis and recommendations.
There are many ways to utilize technology in your dealership. It may make sense to sit down with employees to review what efficiencies you can still achieve and which reports take excessive time to prepare. Find out if there is a way to squeeze more service billable hours out of your technicians by updating their equipment. Inquire about your employees’ level of knowledge of the Internet, using e-mail, converting files to PDF, scanning, utilizing spreadsheets to automate reports, downloading data efficiently and in the correct formats from various sources, etc.
Let me know what you are able to achieve. If we can’t escape technology, we might as well embrace it.
Vol. 6, Issue 9