For at least a decade, dealer Katie Bowman Coleman searched for a dealership management system as easy as point and click.
Her store, Bowman Chevrolet, in the Detroit suburb of Clarkston, has used systems from Reynolds and Reynolds, CDK Global and Cox Automotive's Dealertrack. In her view, they're all fine products but have limitations — expensive pricing, "antiquated" technology, extra fees or hurdles to connect software tools developed by outside vendors.
Last year, Bowman Chevrolet switched DMS providers again. Coleman, the store's owner, chose a startup called Tekion, which promises an Amazon-like experience and has the backing of General Motors.
"It's just what we've been wanting for decades," Coleman said. "This isn't a new desire on the part of dealers. This is just a time when I think some disrupters are going to come in and force that change on the industry."
Tekion is signing up dealers at a time when the overall market for DMS software is in flux, giving dealers more choices for a platform that fits their stores' needs. New entrants and smaller players are vying for share in a segment long dominated by CDK and Reynolds, both of which are in the process of reinventing their businesses.
Their decades-old duopoly may be cracking. Today, while CDK still is believed to be the clear market leader in number of dealership customers, it's less certain which company holds the No. 2 spot. Cox Automotive asserts that its Dealertrack platform is close to overtaking Reynolds and Reynolds, a claim that a dealership consultant with the Gillrie Institute, which advises dealerships looking to switch DMS providers, said is possible. Comprehensive market share data is not publicly available.
Experts say the shuffling is good news for dealers, who for years have been asking for better DMS pricing and contract terms along with improved technology and flexibility. The DMS is a dealership's central operating system and data repository. Changing systems is one of the most arduous processes a dealer can undertake and often likened to a heart transplant for its complexity.