SAP brings greater flexibility, profitability to automotive dealers

SAP, market leader in the business applications software market, is set to extend its record of helping boost productivity and profitability in the automotive industry following the addition of a vehicle dealer management solution to its product offering in the sector.

The new functionality, to be known as SAP Dealer Business Management (DBM), will provide a single, unified platform for small dealers as well as large dealer groups or manufacturer-owned retail subsidiaries.

The dealer management functionality will be integrated into SAP's existing SAP for Automotive software suite, which already serves parts makers, sub-systems assemblers and car manufacturers.

It will help vehicle dealerships boost productivity and profitability through tighter integration of internal processes and easier collaboration with vehicle importers and original equipment manufacturers (OEMs).

Key to enabling the new functionality was SAP's recent acquisition of a vehicle dealer management application suite from a UK partner, DCS Quantum, which originally built its product on SAP's NetWeaver integration platform.

Says Zach van der Walt, automotive solution manager for SAP Africa: "SAP has been consolidating and integrating processes and systems for the automotive OEMs for many years. During the past few years, with our automotive portal, we've brought those very powerful systems to the doorway of the dealers, who've used the portal to improve the efficiency of their parts and vehicle ordering and streamline their financial inter-relationships with OEMs.

"Now, the dealer-specific sales and service functionality we're adding to SAP for Automotive, via DCS Quantum, puts the dealer's information technology (IT) and business processes on a par with the sophistication of the OEMs. It therefore enables a seamless exchange of vital business information that cuts redundancy out of both dealer and OEM operations and significantly increases profitability on both sides.

"Organisations in the supply chain don't lose their independence. They just massively boost their collaborative capabilities."

Known as SAP Dealer Business Management, the new solution will offer dealer-specific processes such as vehicle sales, vehicle service, service-parts management and marketing, as well as core (ERP) processes for human resources, finance and managerial accounting.

Van der Walt says SAP Dealer Business Management will be of particular interest to South African dealerships, most of whom are small or medium-sized businesses for whom the use of a standardised, integrated, highly automated system already approved and used by their OEMs and importers will save a great deal of money, time and effort.

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"Even though our local industry is comparatively small, it's incredibly competitive. Every rand saved in selling or servicing a vehicle is precious. But most companies are already running as lean as they can. So, the chance to achieve new efficiencies by consolidating business processes in this way constitutes a significant strategic advantage."

SAP will make implementation of SAP DBM for South African organisations more affordable by making it available as a mid-market best practice solution. SAP Best Practices is a set of industry-specific solutions specifically geared for the mid-market in terms of licensing and implementation costs.

"Because the Best Practice solutions are pre-packaged, requiring a minimum amount of customisation, implementation is quick," Van der Walt says. "Dealers will see a very rapid return on investment."

Also, because DBM uses SAP's integration platform, NetWeaver, existing dealership IT systems can be easily integrated with it - and one another - shortening implementation times and reducing costs still further.

SAP DBM minimises the administration, finance and daily operation of vehicle sales by linking customer requests and vehicle orders with existing stock at the dealer, within the enterprise, and in the pipeline.

It provides control over day-to-day operations such as appointment scheduling, work-order management, service reminders, service marketing and reporting, and service-cycle management.

It optimises inventory investment to support counter sales and repair and installation activities - giving the dealer complete control over the movement of both new and returned parts, as well as inventory and parts-procurement processes.

It allows dealers to target new-business prospects while improving customer contact and retention - through data management of prospects and customers, as well as automated follow-up for vehicle and service campaigns.

It also offers a suite of ledgers that provides integrated financial reporting, analysis and compliance with business process and transaction systems - helping with business planning, forecasting, and cost and profitability management.