Features of Dealer Management Systems, Their Advantages, and How to Pick One

You have several responsibilities as an independent or vehicle dealer. You are keeping an eye on the inventory, updating your website or marketplace catalogs, talking to customers, and other things. How do you manage this multitasking, though? Do you keep countless databases for everything? This entails looking at your inventory or past consumer purchases. Each time, you have to log in and open a new tracking sheet.


If you are bogged down in such laborious and time-consuming operations, how are you going to concentrate on conversions and customer engagement?


Programs like dealer management systems (DMS), which allow you to escalate without manually traveling through processes, are necessary for efficient dealership operations. Since practically all processes may be integrated into these systems, you can prevent confusion and save all the time and effort associated with opening many sheets and files.


Everything you need to know about a dealership management system, including what it is, what it does, features of automotive dealer management software, what to look for in online dealership management systems, and how AI can help you succeed in the online market, will be covered in this blog.


A Dealer Management System is what?

Simply put, a dealer management system—also known as an automotive dealer management system—refers to a piece of automotive software that aids dealers in efficiently managing a variety of dealership tasks. The abbreviation “DMS,” which we usually use to stand for “dealership management system,” also applies to dealer management tools, services, and solutions. The numerous demands of dealerships, including pre-sales, sales, purchases, and post-purchases, financial accounting, inventory management, CRM, human resources, and customer relationship management, are the emphasis of a typical dealer management system for the automotive sector.


While delivering a seamless and effective operational experience, automotive dealer management software may connect OEMs, dealers, distributors, vehicle firms, and customers. Dealership Management Systems have advanced significantly since the early 1990s, when they first became popular. DMS auto apps were first presented as a decentralized complex system, but they have since developed into centralized systems and are now an essential part of the supply chain network. The majority of dealers and distributors in the top industries (auto, manufacturing, retail, telco, etc.) will employ some sort of car shop management software. According to research from marketwatch.com and globenewswire.com, an online dealership management system’s market share will reach a staggering US$ 6395.1 million by 2028 and will continue to rise at a CAGR of 8.37 percent.


What is the purpose of a dealer management system?

A dealership may do all daily responsibilities, such as sales operations, financial operations, service operations, etc., and make them cooperate with one another thanks to dealer management system software. On a fully integrated platform, it is a potent software tool that offers auto dealers solutions. The future profitability of enterprises is supported by these solutions. a cloud-based platform that dealerships use to handle their inventory, customer data, paperwork, credit reports, and vehicle sales. With a Car DMS, dealers may improve every part of their business by combining all the required tools into a single platform. If all of your dealership’s daily transactions are done there, you can handle them more efficiently. You can create point-of-sale invoices, see service history, or follow up on leads without logging into several platforms in order to manage your inventory.

Additionally, thanks to the software integration capabilities in a DMS, dealers may manage their entire business in one cloud-based auto dealership software. You may efficiently track every dealership action with its help and get a better sense of the overall situation. An automobile DMS’s integration features make it simple to share data between operating areas and streamline your business operations. Staying knowledgeable about every facet of your dealership will help you increase operational effectiveness, boost customer satisfaction, and even make financial savings.


Keep in mind that successful dealerships have smoothly operating, integrated departments. By allowing departments the space to interact, communicate, and be aware of transactions taking place in other realms, car dealer management software can assist you in achieving that. You can save costs, increase operational effectiveness, and—most importantly—boost consumer interaction across channels with a good dealership management system.


Typical Characteristics of a Dealership Management System

It can be difficult to select the best automotive DMS supplier for your company because there are so many of them and they all provide a wide range of features and services. However, common basic elements seen in the majority of Automotive DMSs include deal structuring, inventory control, and BHPH (buy here, pay here) strategies.


Here are a few fundamental features of a dealership management system and how they can streamline your operations. While these are the basic features, some systems also offer advanced options like online marketing tools and website integration, which can significantly improve your business but come at a higher price.


managing the dealing of vehicles

The core component of every automotive DMS is vehicle dealing management. It ought to be a fundamental component of your software for auto dealers. This tool gives your company a structure for managing deals successfully. It often comes with a variety of tools that assist in gathering the data required to negotiate the best offer. Utilizing credit applications to connect customers to various lending and financing organizations is another feature of some car dealer management software.


Inventory Control

With an inventory management feature in the automotive dealer management software, a car dealership can review all its vehicles without going for a physical inspection. If you run a dealership with a sizable inventory, this is extremely helpful. All vehicle records can be stored in the program, allowing you to access and retrieve specific records in mere seconds. Additionally, you can monitor your expenses for reconditioning and flooring and swiftly provide industry-standard book values, such as NADA and KBB.


Customer Relationship Management

Say goodbye to manual searches through stacks of business cards or phonebooks to locate the right customer. The customer management feature of dealership management systems enables you to store customer information and easily connect with them. Therefore, with the auto dealership software, you can choose to call or send them a message in real-time. In addition, you can access customer information, record conversations, and categorize your contacts, enabling you to keep track of potential leads and discarded prospects.



An effective Dealership Management System must be able to automate all aspects of accounting, including point of sale, inventory, and transaction costing. The accounting module of the auto shop management software should be at par with the capabilities of your dealership’s current system. Some of the prime features of a robust accounting module include the ability to:


Swiftly and effortlessly generate financial reports for communication with managers and employees across departments.

Develop operating budgets, monitor actual performance, and analyze car dealership profitability of a specific location or department.

Automatically process all transactions related to unit inventory and sales.

Service Management and Productivity Tracker

A dealer management system with service management capabilities can enhance the productivity and profitability of your service department. The automotive dealer management software provides a clear view of your dealership’s service schedule, enabling you to prioritize work orders and meet deadlines. Some of the additional features that a service management module should offer include the following:


Streamlining the service write-up process to make it more flexible and efficient

Scheduling service work to maximize billable hours

Allowing technicians to clock in and out with ease

Quick and efficient repair handling, as well as tracking of warranty claims

Reporting of tools and analytics

It is one of the dealer management features that allow users to generate, analyze, and visualize data of documents and activities within the system. This tool provides insights into document usage, workflow efficiency, user behavior, and other relevant metrics.


Estimating Repair orders and billings

It is a functionality that enables automobile service centers or dealerships to create and manage repair orders and estimates for vehicle repairs and services. Dealership management requires proper documentation of all the repair orders and billings when providing services. An online dealership management system gives all of that on one platform. Additionally, it also provides service recommendations, parts, and labor management too.


LMQ(Lead Management Quoting)

A dealer management process involves managing leads and generating price quotes for potential customers that might be interested in purchasing the product. Therefore, a DMS dealer management system allows dealers to capture and store information about customers who have expressed some kind of interest in the product. It also helps the sales team by tracking the progress of the leads.


Integrated Accounting

A DMS allows one smooth and swift connection of financial data through integration between the DMS software and QuickBooks. So, now a dealer can get live updates of all the financial transactions and accurately map all the financial entries.


Benefits of a Dealership Management Systems

Besides these features, there are a million reasons why you should go for auto dealership management. Some of the noticeable benefits of an automotive DMS include the following:


Streamlined processes

Auto shop management software offers a centralized platform to manage all aspects of your dealership, making your processes more streamlined and reducing the time and effort required to run your business. By implementing car dealership management software, you can save time and resources and instead focus on crucial tasks such as expanding your business and providing exceptional customer service.


More efficiency

Dealership management software also helps you improve operational efficiency by automating many manual tasks. For instance, an automotive DMS can automate inventory management functions such as updating prices and generating reports, thus saving time and minimizing the likelihood of errors.


Better customer experience

A dealership management system can improve customer service by providing resources for managing customer connections and interactions. An automotive CRM system in your car DMS, for example, can assist in tracking customer preferences and interactions, allowing you to provide more effective and individualized service.


More saving and selling opportunities

Through auto dealer software, you can save time and positively impact your finances. For instance, a DMS helps reduce mobility expenses and decrease shuffling between sheets and files. Additionally, it enables you to highlight your inventory on multiple platforms, viz., your website, giving a professional impression to potential buyers. Similarly, the system’s CRM allows for quick and efficient communication and transactions, resulting in faster revenue generation.


What Integrations to Look for in a Dealer Management System

Before choosing an Automotive DMS software, consider a few things. Some of them that could drive your company to excellence involve the following.


How many third-party integrations does the automotive DMS offer?

This is a significant bit. An online dealership management software that integrates with third-party solutions is crucial for operational efficiency. Such integrations include online payment gateways such as PayPal and Stripe, shipping software, live chat, multichannel inventory management, accounting software, email, and car dealership marketing automation, feedback, and rating software, customer relationship management, analytics, and more.


Integration for dealer management system

These integrations can help drive growth and improve the overall functioning of your business on the online platform.


CRM integration

A CRM system helps you enhance the customer experience by providing a deeper understanding of customer engagement. It also enables meaningful interactions with customers visiting your dealership, from pre-sales communication to standard interaction, post-purchase service, and support. This process ultimately contributes to improved customer satisfaction.


ERP integration

It is a multi-channel third-party integration that serves as the backbone of car dealer management software. The ERP system facilitates effective management of the items you want to sell, including efficient customer-specific pricing, inventory management, and streamlined sales and order processing.


POS integration

POS integration streamlines the connection between a point of sale software and an automotive accounting and operations platform, allowing for quick and easy retrieval of detailed data.


Chatbot integration

E-Commerce chatbots for dealerships are a valuable asset that helps enhance customer experience. These chatbots use smart prompts and quick responses to engage with interested customers and casual website visitors. They also address queries and questions related to specific vehicles, leading to improved sales and profits and boosting overall revenues.


RMA reporting

This integration feature, termed return merchandise authorization (RMA), enables customers to return vehicles and receive a refund, replacement, or repair while the vehicle is still under warranty.


Smart search feature

The Smart Search integration helps sort product labeling and reduce confusion by providing relevant charts. Therefore, buyers can quickly and easily search for their desired vehicles and related products on the dealership management system’s website.


How to Select a Dealer Management System

Investing in an automotive DMS is not a cakewalk because you have to evaluate a DMS through many lenses, viz., long-term benefits, overall relevance, ease of onboarding, etc. There are many dealer management system providers that provide various features. These features are critical to running an automotive dealership. Consider the following points when selecting a dealer management system.


What problems do you need your car DMS solution to solve?

What specific problems do you hope to solve with a DMS? Are there issues with financial health, departmental performance, and inefficiencies leading to lost sales and employee hours? The more specific you can be, the better. What are the biggest challenges, and what impact would solving them have? Make sure to find the answer to these questions before diving headlong into implementing auto dealer management software.


Don’t forget to get buy-in before investing in auto dealership software.

To overcome employee resistance to a new DMS, involve key employees in evaluating it, give them ownership of the project, and make it fun with contests. Therefore, this will help them see the benefits, feel in control, and minimize disruptions.


Collaborate more for successful automotive DMS implementation

The success of DMS implementation depends on your dealership and employees, but your implementation team will be a valuable resource. Partner with them to make it a positive experience with minimal disruptions through open and frequent communication. Make onboarding easy by providing the necessary training.


Training is crucial for a smooth DMS implementation. Without proper training, it can be a disaster. Therefore, Refrain from assuming you can figure it out on your own. You need experts with experience to help, just like you wouldn’t let a novice work on a complex engine. The software affects all aspects of your business, so make sure you receive adequate training.


Clarity on the total cost of ownership

Price is important, but 80% of buying decisions are based on factors other than the initial price. The total Cost of Ownership includes all costs over a product’s lifespan, including lost employee time, malfunctions, and lost sales. Buying a DMS solely on price can result in unplanned expenses and frustration, such as inaccurate data, stability issues, and a need for another DMS change. Hidden costs will eventually contribute to the Total Cost of Ownership.


Are you getting a long-term ROI

While the price may be a short-term concern, a DMS can offer a long-term return on investment in improved efficiencies, better morale, and reduced frustration. However, calculating ROI based only on hard numbers only partially captures the benefits of a DMS.


Why AI Integration is Popular With Dealer Platform

Integrating an AI image editor into your existing workflow may be a hassle and can disrupt your existing workflow. To give you a seamless and smooth experience, AI works with your dealer platforms to integrate into your workflow with no extra effort on your part. No need to go through the process of reshooting images.

No leads were lost. reduced overhead.
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