Buy here pay here (BHPH) dealerships are used car dealerships that offer financing to customers with poor credit or no credit history. These dealerships are often the only option for these individuals to purchase a vehicle, but they come with their own set of challenges. One of the key challenges facing BHPH dealerships is the lack of a proper dealership management system (DMS). In this article, we will discuss why BHPH dealerships need a DMS and how it can help them overcome some of the challenges they face.
First, let’s understand what a DMS is and how it can benefit a dealership. A DMS is a software solution that helps car dealerships manage their day-to-day operations, from form printing and compliance to finance and accounting. It offers a range of features and tools that streamline and automate many of the processes involved in desking a deal, allowing the dealership to operate more efficiently and effectively.
One of the biggest advantages of a DMS for BHPH dealerships is that it helps them keep track of their customers and their payments. BHPH dealerships often offer in-house financing to customers with poor credit, which means that they are at a higher risk of defaulting on their loans. A DMS can help the dealership track their customers’ payment history, including any missed or late payments, which can be useful for making credit decisions and managing risk. Some DMS systems can even send SMS text payment reminders to customers who may be on pre-paid phones with limited minutes.
Another advantage of a DMS for BHPH dealerships is that it can help them manage their inventory. A DMS can provide the dealership with real-time data on their inventory, allowing them to make informed decisions about what vehicles to stock and when to restock. This can help the dealership maximize their profitability by ensuring that they always have the right vehicles on hand to meet customer demand.
A DMS can also help BHPH dealerships manage their finances more effectively. It can provide the dealership with real-time reporting, allowing them to make informed decisions about their budget and expenses. This can help the dealership improve its bottom line by reducing costs and increasing revenues.
In addition to these benefits, a DMS can also help BHPH dealerships comply with regulations. Many states have strict regulations governing the financing and sale of used vehicles, and a DMS can help the dealership ensure that they are in compliance with these regulations with proper forms. This can help the dealership avoid costly fines and other penalties.
In conclusion, BHPH dealerships need a DMS for several reasons. It can help them track their customers and their payments, manage their inventory, manage their finances, and comply with regulations. A DMS can help BHPH dealerships overcome some of the challenges they face and improve their overall performance.