Best Auto Dealer Accounting Software

What is Auto Dealer Accounting Software?

Auto dealer accounting software is a specialized software solution designed to help automotive dealerships manage their financial and accounting activities, such as invoicing, payment processing, and reporting.

It offers features made especially for the demands of the automotive sector, like managing accounts payable and receivable and keeping track of vehicle inventory, sales, and commissions. The software's objectives include streamlining financial procedures, increasing precision and effectiveness, and giving dealership performance analysis.

Benefits of Auto Dealer Accounting Software

Auto dealer accounting software offers several key benefits to dealerships to help them streamline the entire process. Below are the main benefits -

1. Invoicing Automation

Auto dealer accounting software can help with invoicing automation by automating many of the manual tasks involved in the invoicing process. This can include:

• Generating invoices: Manual data entry is no longer needed because the software can automatically generate invoices based on sales transactions.
• Automated billing: The software can automate the billing procedure, including recurring bills for continuing services like maintenance or warranty agreements.
• Customer account management: It is simpler to handle invoices and payments using software tracking customer accounts.
• Auto dealer accounting software can assist in increasing accuracy, decreasing the possibility of errors, and saving time and money by automating these processes. This frees up dealerships to concentrate on other important company operations.

2. Integration with Other Systems     

Auto dealer accounting software can integrate with other systems through APIs (Application Programming Interfaces), allowing data exchange between the systems. This integration can include the following:

• Inventory management systems - to keep track of vehicle stock levels, sales and pricing information
• Customer relationship management (CRM) systems - to manage customer data, sales history, and marketing campaigns
• Payment processing systems - to process transactions and integrate payment information into financial reports
• Website platforms - to show updated inventory information on dealership websites

The benefits of integration include improved data accuracy, increased efficiency and reduced manual data entry errors. The specific integration options will depend on the software used and its capabilities.

3. Tax Compliance    

It is important to consider that the auto dealer accounting software can assist with tax compliance correctly.

• With the information provided for each transaction, the software may calculate taxes and produce tax reports for tax returns automatically.
• To assist with tax compliance and tax planning, the software can generate tax reports, including use tax and sales tax reports.
• The software can provide a thorough record of every transaction, which can be used to support efforts to adhere to tax regulations.
• The tool can help you track the sales taxes taken and paid to authorized taxing bodies.

4. Data Security    

Auto dealer accounting software can provide data security through several methods:

• Sensitive data such as financial information and customer data can be encrypted to protect it from unauthorized access or hacking.
• The software can have user management features that allow administrators to control who has access to what information and at what level.
• Regular data backups can be performed to ensure that critical information is not lost in the event of a system failure or data breach.
• In some cases, data can be stored in secure data centers, with multiple layers of physical security to protect against unauthorized access.
• The software may be developed and maintained in accordance with security standards such as SOC 2, PCI DSS, and HIPAA to ensure the secure handling of sensitive information.
• Dealerships need to research and understand the security measures in place for any accounting software they are considering to protect their critical data.

5 Types of Auto Dealer Accounting Software

Auto dealer accounting software refers to software designed for auto dealerships to manage their financial operations. Some popular types of auto dealer accounting software include

1. Tax Preparation Software      

   Tax form preparation allows the user to enter their financial information and prepare the necessary tax forms, such as 1040, W-2, and 1099. Provide tax calculation tool that automatically calculates the tax owed or refund due based on the entered financial information, allows the user to file their tax returns with the IRS electronically, imports previous tax returns, and helps in error checks.

2. Accounts Receivable/Payable Software    

   Accounts receivable and Account payable software is used to handle a company's financial operations. One of the basic features that are typically included in the software is invoicing. Other features include customer payment processing (including credit card, direct deposit, and check payments), cash flow management, accounts receivable and payable management, and generating financial reports like balance sheets, profit and loss statements, and cash flow statements to help businesses understand their financial health.

3. Dealer Management Systems (DMS)     

   Dealer Management Systems (DMS) is a comprehensive software solution designed for automobile dealerships to manage their operations. The software includes features like inventory management, sales, and marketing management and enables dealerships to manage customer information.

4. Finance & Insurance (F&I) Software    

   Finance & Insurance (F&I) software is a type of software designed specifically for automobile dealerships to manage their finance and insurance operations. This tool helps in payment processing for finance & insurance, check payments, product & pricing management.

5. Inventory Management Software     

   Inventory management software can be used by businesses and industries, including retail, manufacturing, and distribution, to track and manage inventory levels. The software can help businesses reduce the waste percentage, improve their inventory accuracy, and make informed decisions about their inventory management.

   It also helps businesses quickly and accurately track inventory items using barcode scanning technology, allowing businesses to track the quantity and location.

Features offered by Auto Dealer Accounting Software

Auto dealer accounting software provides a range of powerful features that help dealerships streamline their financial operations and make informed business decisions. Some of the most common features offered by auto dealer accounting software include

1. Payment Log    

A payment log is a powerful feature offered by some auto dealer accounting software that allows dealerships to track and manage payments from customers and other entities. The payment log typically includes the following features:

• Payment reconciliation to guarantee the integrity and comprehensiveness of financial information
• Payment reporting payment summaries and payment history reports to provide insight into payment patterns and trends.
• Can track payments by the customer, enabling dealerships to readily access personal customer payment information and keep track of each customer's payment history.
• The software's ability to track payments by vehicle gives dealerships quick access to payment data for each sold vehicle.

2. Profit & Loss Report          

Accounting software for auto dealerships frequently includes a function called a profit and loss (P&L) report. A P&L report gives an overview report of a dealership's earnings and costs for a specific time period.  Some of the main functions that an auto dealership accounting software with P&L reporting may provide include the following:

• Allow to track and record revenue from numerous sources, including the sales of vehicles, loans, and services and components.
• Reporting expenses such as payroll, rent, utilities, etc.
• Gross Profit and Gross Loss calculation
• The software can determine the net profit or loss.
• Create personalized standard and customized reports according to the requirements of your business.
• Drill down into specific categories of revenue and expenses to see more detailed information.
• Compare P&L reports over different periods to track changes in the dealership's financial performance.

3. Customer Relationship Management (CRM)   

A CRM feature in auto dealer accounting software is a tool that helps to manage customer relationships and interactions, improves sales processes and increases overall customer satisfaction. It provides below mentioned features also - 

• A centralized database for storing customer information
• Automates sales activities such as lead tracking 
• Follow-up scheduling
• Generates reports to analyze customer behavior and trends
• Streamlines sales processes, increases sales, and improves customer experience

4. Built-In Time Tracker 

A built-in time tracker is a feature commonly found in auto dealer accounting software. It allows many important dealership tools to accurately track the time spent on various tasks and activities, such as:

• Calculate the time spent on customer meetings, vehicle repairs, and administrative tasks.
• Generate reports and analyze employee productivity
• Calculate payroll and allocate costs to specific tasks or projects
• The built-in time tracker can help auto dealerships increase efficiency, reduce expenses, and make informed business decisions based on accurate time tracking data

5. Inventory Management         

Inventory management is a feature commonly found in auto dealer accounting software. It helps dealerships effectively manage their vehicle inventory by tracking stock levels, recording purchase and sale transactions, and generating reports; this includes:

• Tracking vehicle details such as make, model, year, color, VIN, and price
• Inventory management
• Up-to-date records of vehicle inventory, reducing the risk of stock shortages or overstocking
• Helps to make informed purchasing decisions
• Manage pricing strategies, and track sales and profit margins
• Optimize inventory levels, increase sales, and improve overall business efficiency

Tips To Choose The Best Auto Dealer Accounting Software

Finding the right auto dealer accounting software can be a challenge that suits your business requirements, but there are several ways you should take to make the process easier and for a better decision     

1. Understand the needs

Out of so many ways to find the right auto dealer accounting software, the most important way is to identify your specific needs and requirements, such as inventory management, financial reporting, and customer relationship management. 

• Check what type of features are most required for you
• The price you can pay
• The level of security you need 
• Which software needs to be integrated, etc.

2. Research potential software 

Before choosing the right software, consider the below point to pick the potential software out of all the options available in the market.

• Use online resources, such as websites and forums, to learn about it
• Read software reviews to get an idea of the software's strengths and weaknesses
• Attend trade shows and events related to the automotive industry to learn about new software options and trends
• Reach out to vendor to ask any questions or to request a demo
• Schedule a call with a software consultant to discuss your specific needs

3. Test the software out    

One of the best ways to find the right auto dealer accounting software is to test it out. This can be done in various ways:

• By setting up a demo account 
• Attending a webinar or a software presentation 
• Requesting a trial version from the vendor

4. Compare features and prices

Another way to find the right automotive accounting software is by comparing features and prices. This involves:

• Researching different software options 
• Evaluating the software based on the features they offer and the price they charge
• Check key features like inventory management, financial reporting, customer relationship management, and sales tracking 
• By comparing the features and prices of different software options, you can determine which software provides the best value for your dealership's accounting needs and budget.

List of top 5 Auto Dealer Accounting Software

Want to find the right software for your auto dealership? Check out these five best auto dealer accounting software.

1. CDK Drive

CDK Drive is a car dealership accounting software offered by CDK Global. It is made to assist dealerships in managing a variety of business-related tasks, such as sales, servicing, marketing, and financial reporting.

In order to increase productivity and streamline operations of small or midsize businesses, CDK Drive offers several capabilities, such as customer relationship management, appointment scheduling, parts ordering, and more.

It is popular among car dealerships all around the world and is renowned for its powerful and streamlined user interface.

Features

• CRM for managing customer data
• Financial reporting tools
• Scheduling appointments and ordering parts
• Marketing automation solutions
• Sales tracking software & reports

Pros 

• Comprehensive solution
• User-friendly interface
• Automates many manual processes
• Integrates with other systems

Cons

• Can be expensive
• May experience technical issues
• Learning curve for dealership employees
• May not allow for as much customization

Pricing

• Provides custom pricing option.

2. Xero

Xero is a cloud-based accounting software for automobile dealers that can be used for financial management and accounting tasks.  It automates manual financial tasks like payroll calculations, invoicing, bank reconciliation, and reports, etc. 

Features

• Create and send invoices to customers
• Payroll solution for dealership employees
• Calculate payroll taxes, and track employee hours
• Automate the bank reconciliation process
• Real-time financial reporting
• Integrates with a range of other systems

Pros

• Can be accessed from anywhere
• User-friendly interface
• Easily adaptable

Cons

• Limited customization options
• Technical issues
• Can be expensive
• Learning curve for the users

Pricing 

• Starter: $25 per month.
• Standard: $40 per month.
• Premium: $54 per month. 

3. Sage Intacct

Sage Intacct is a cloud-based accounting software designed for businesses of all sizes. It helps businesses manage finance and create custom reports, making it easier for businesses with multiple automation tools.

Features

• Manage cash with different methods 
• Provides configurable reports and dashboards
• Supports multi-entity management
• Offers an iOS and Android mobile app

Pros 

• Helps in improved reports creation
• The user interface is very smooth
• Dashboards can be configured easily

Cons

• Technical issues
• Very few customization options

Pricing

• Can request custom pricing quote. 

4. Fishbowl

Fishbowl is a specialized software designed for auto dealerships to manage their daily operations with ease. It provides inventory management, sales tracking, customer relationship management, and financial reporting tools to streamline processes and reduce manual labor. 

With real-time data access, dealerships can make informed decisions and stay competitive in the market. Fishbowl is customizable, allowing dealerships to tailor the platform to their specific needs. 

Features

• Inventory management
• Sales management
• Reporting
• Customer relationship management (CRM)
• Accounting integration

Pros

• User-friendly interface that is easy to navigate
• Customizable to meet specific needs
• Streamlines sales and inventory management processes

Cons

• Limited mobile functionality 
• Difficulty with customer support and technical issues
• The cost may be more expensive

Pricing 

• Offers custom pricing options.

5. QuickBooks Desktop Pro

QuickBooks Desktop Pro is an accounting software designed specifically for the needs of auto dealerships. It offers a comprehensive range of features to manage finances, sales, and inventory in an efficient and organized manner.

Features

• Invoicing and billing
• Sales tracking
• Financial reporting
• Customer management
• Integration with other software

Pros

• Easy to navigate
• Highly reliable 
• Very secure

Cons

• Limited to desktop use
• Difficulty with customer support 

Pricing 

• Offers custom pricing option.

Software That Auto Dealer Accounting Software Integrates With

Accounting software for auto dealers can be integrated with a wide range of other software programs to give businesses a complete and seamless financial management system. Auto dealer accounting software frequently interacts with the following applications.

1. Customer Relationship Management (CRM) Software

   From initial contact to follow-up after a sale, CRM software aids dealerships in managing customer contacts and data

2. Inventory Management Software

   Inventory management software assists car dealerships in the management of their inventory of vehicles, including the tracking of vehicles, setting prices, and managing sales.

3. Electronic Data Interchange Software

   Automotive dealerships may electronically exchange transactions and data with their suppliers and customers thanks to EDI software.

4. Payment Processing Software

   Payment processing software helps dealerships to process credit card transactions, ACH transactions, and other types of payment quickly and securely.

5. Dealership Management System (DMS) Software

   DMS software assists dealerships in managing all aspects of their daily business, including sales, service, and parts.

6. Business intelligence (BI) software

   BI software offers real-time financial information and data analysis to dealerships, assisting them in making strategic business decisions.

How Much Does  Auto Dealer Accounting Software Cost?

The cost of auto dealership accounting software can depend upon several factors, such as the features offered, the number of users, the vendor, and the pricing model (e.g., one-time fee, subscription-based, etc.). On average, the cost can range from $80 to $460 per year. It is recommended to compare multiple options and their costs before making a decision to ensure you get the best value for your dealership.

Rising Trends of Auto Dealer Accounting Software

The auto dealership industry has seen a growth in the adoption of accounting software to streamline financial operations and improve efficiency. Here are some of the current trends in auto dealer accounting software:    

1. Cloud-based solutions  

   An increasing number of auto dealerships are choosing cloud-based accounting software to streamline their financial operations. This allows them to access their financial information from anywhere, at any time, with just an internet connection. 

   Cloud-based solutions have become increasingly popular in the auto dealership accounting software industry due to their numerous benefits such as accessibility, data security, automated updates, scalability, etc.

2. Improved reporting capabilities

   Improved reporting is a growing trend in auto dealer accounting software, offering a more comprehensive and accurate view of a dealership's financial performance. 

   As dealerships require up-to-date financial insights, auto dealer accounting software solutions are adapting to provide real-time access to data, customizable reports, and visual representations of financial data. The software solutions also offer predictive analytics, allowing dealerships to make informed decisions based on past performance trends.

   Some of the trends in improved reporting capabilities in auto dealer accounting software include real-time data access, dashboards, predictive analysis, customizable reports, and more.

3. Powerful & flexible software

   Powerful and flexible software solutions are in high demand for auto dealerships, as they are looking for software that can meet their specific needs and grow with their business. Auto dealer accounting software has been evolving to meet these demands, offering powerful and flexible features and functionalities. It includes mobile access, cloud-based solutions, customized workflows, etc.

4. Increased automation

   Increased automation is a rising trend in auto dealer accounting software as dealerships look for ways to streamline their financial operations and reduce manual processes.

   The rise of technology has enabled auto dealer accounting software solutions to offer increased automation capabilities, allowing dealerships to save time, increase efficiency, and reduce errors.

   So, whenever you opt for auto dealer accounting software, ensure that it provides different automation functionalities.

5. Customer service

   Customer service is a critical aspect of any software solution, and auto dealer accounting software is no exception. As dealerships look for software solutions that meet their unique needs, the trend in customer service for auto dealer accounting software is shifting towards more personalized and proactive support. 

   Auto dealer accounting software solutions are now offering proactive support, anticipating and addressing customer needs before they become issues.

Final Thoughts

In conclusion, accounting software for auto dealers has emerged as a crucial resource for contemporary businesses. In order to adapt to the changing needs of dealerships, the software now offers strong and adaptable features and functionalities, more automation, and individualized customer care.

Dealerships should consider both their specific demands and requirements when choosing an auto dealer accounting software solution and the program's capabilities and features.

It's critical to pick a system that delivers a comprehensive picture of a dealership's financial performance, real-time financial data, and the adaptability and scalability to expand a dealership's operations. Dealerships can take charge of their finances, make informed decisions, and accomplish their company objectives with the proper car dealer accounting software.