Yago Paramo

Automotive Entrepreneur

DMS Access Taxation

Just starting 2017 and we already hear rumors of new DMS access charges for vendors seeking dealership data to perform a service. A great quote from the 2017 JD Power Automotive Summit; “Information security should never be a guise for information taxation”. DMS systems are doing it right though… they charge their client—not you!—but the vendor performing the after data task and this vendor has no choice but to pass on these charges to you.

On a conversation with one of the top CRM systems I was told that DMS access fees are sometimes as high as $800/month depending on how often and how many departments they may need, this cost inflating their price as much as 30% of their charge to the dealer. So you, the dealer, thinking that are the client, are just the end user of a relationship between two companies that need to share your data. The problem resides that the company that has the data has never agreed to spend time and money on systems to deliver your data and the company receiving it can’t give you a true quote on a cost that varies depending on the depth of your needs.

We are in a world where malware systems have fine-tuned their models so well that they even attack police departments and getting away with it: Police pays off ransomware & 8 years of data stolen Texas police department (You can find plenty of eye opening cases by searching Google for ransomware).

So you must ask yourself if should the DMS company that faces more access points as new vendors enter the space carry on the cost or pass it on to you? Is this a fair thing to ask and what protection do I get? As you know we all get a $500 checking account withdraw limit with Bank of America, you can call and change the limit, but forfeiting their liability when you do so.

An important question for those of you negotiating new DMS contracts is to ask for the terms of access to your data. While it is not a fee present in the contracts because you will not be directly paying the DMS for it, it will come back to you, so you may as well negotiate that rate in at that time and when the next vendor needs data, make sure you know that they are taking that cost out and that you connect them with your DMS provider.