DMS vs CRM: which does a car dealership need?
People use "dealer management software" for two different things. One is the back-office system that runs accounting, parts and service. The other is the sales-side system that manages leads, customers, deals and inventory. They solve different problems, and many dealerships, especially independent used-car stores, do not need both in a single product.
What a DMS does
DMS stands for dealer management system. It is the system of record for the money and the shop. The main parts are:
- Accounting
- The general ledger, accounts payable and receivable, and the books that your accountant and lender read.
- Vehicle and deal accounting
- Posting each sale, trade-in and cost of a vehicle to the books.
- Parts
- Parts inventory, ordering and pricing.
- Service
- Appointments, repair orders, technician time and warranty claims.
- Manufacturer connections
- For a franchised dealer, the reporting and ordering links that the manufacturer expects.
What a CRM does
A CRM, or customer relationship management system, is the system of record for the relationship. It collects leads from your advertising and website, assigns them, keeps every text, call, note and appointment on one customer page, tracks how fast each lead was answered and shows the sales manager what is slipping.
A dealership CRM often goes a step further and holds the inventory and the deal worksheet, so a salesperson can take a shopper from first enquiry to bill of sale in one place.
Where they overlap, and why it hurts
Both hold customers, inventory and deals, which is where double entry creeps in. Someone keys a customer into the CRM, then keys the sale into the DMS. Ask any vendor what moves between the two systems automatically, in which direction and how often, and what happens when the same customer is entered twice.
The usual dividing line is simple: the sales side lives in the CRM, and the finished deal and the money go to the books.
Who needs what
- A franchised new-car dealer
- Usually has to run a DMS that the manufacturer approves, and will often add a CRM on top for lead handling.
- An independent used-car dealer with no service bay
- Often keeps the books in accounting software and has no parts or repair orders to manage. What it needs most is a strong sales-side system.
- A used-car dealer with a service or repair shop
- Needs repair orders and parts as well as sales, from one system or two that are connected.
- A small or new dealership
- May need very little back-office software and a good deal of sales-side discipline: fast replies, follow-up and clean paperwork.
Five questions to settle it
- Do I run a service department or sell parts?
- Does my manufacturer or lender require a particular system?
- Who keeps the books, and in what software?
- How many places do I key in the same customer or vehicle today?
- Which problem costs me most right now: slow replies and lost follow-up, or messy accounting?
If the honest answer to the last one is slow replies and lost follow-up, a DMS is not built for that. A CRM is the tool made for it.
Where DealerStation fits
DealerStation is a sales-side system for Canadian dealerships: leads, customers, text consent, the deal desk with provincial tax, inventory and a hosted showroom, and reports. It does not do general ledger accounting, parts inventory or service repair orders, and it does not replace a DMS that your manufacturer requires.
For a store without those needs, it can be the main system for the sales floor. For a store with them, it sits beside the DMS, and customers and reports can be exported as CSV.