Competition is heating up among vendors of accounting software packages for auto dealerships to handle accounting, general ledger and other financial tracking chores.
The two predominant suppliers are Reynolds & Reynolds and ADP , long the industry standard with a combined market share of more than 70 percent according to a 2003 survey commissioned by the National Automobile Dealers Association.
Reynolds, a leader in the United States and Canada with representation in 36 countries, announced in July its acquisition of DCS that will enable it to expand in Europe. ADP boasts 25,000 vehicle dealers here and abroad.
While these funds make dealers feel good, slush funds tend to cause some problems.
They are now facing growing competition from a cadre of smaller vendors offering similar software and support that is user-friendly and available at a fraction of the price.
This larger selection of vendors offers auto dealership greater choices along with opportunities for substantial cost savings. A number of dealers have learned about the new options and are changing vendors.
For example, the pair of companies that now dominate the market charge anywhere from $5,000 to $15,000 per month for software maintenance plus an additional fee for any hardware items required. And their prices continue to increase.
The new competitors, on the other hand, charge significantly less for monthly software maintenance.
Some auto manufacturers – such as Infiniti, Saturn and Lexus – stipulate the brand of software that their dealers must use, so switching vendors is not an option for them.
Among the larger upstarts are Universal Computer Services (UCS), Adam Systems, Autosoft, PBS Financial Systems and EDS Automotive Retail Group.