13 Sep

I usually keep these blog postings pretty non-commercial. I try to make them on industry related topics and as informative as possible. I decided to make this one a little different in light of our recently announced Business Builder Pricing.

We get inquiries from dealers looking to enter the Buy Here – Pay Here or Lease Here – Pay Here business frequently. As the cost of wholesale inventory has risen to a point where the cost of a 10-year old car is almost 50% higher than it was 5 years ago, the amount of money it takes to enter the business has risen even more drastically.

Most prospective new dealers have a limited amount of start-up cash available and are apprehensive about committing too large a percentage of that cash to a dealership management system to run their dealership. Although they want a system that provides all the functionality they need and one that can grow with them as their dealership grows, they often sacrifice some of that functionality and flexibility to purchase a lower cost software product. Without even getting into the argument that the higher cost of more comprehensive systems is more than offset by the time saved and improved performance it can provide, this approach has its own set of issues.

The problem with this approach becomes apparent when their dealership grows as they projected and hoped that it would. Too often, the less expensive software alternative can no longer provide all the functions the dealer needs. This is especially true if they create an RFC, open additional locations or want to host their data outside the dealership.

Now the dealer must go through the process of finding a dealership management solution that can meet his needs. Not only does this take additional time and the expense of purchasing a second software product, but it also requires a conversion of the data from the original software into the new dealership management system. This can be an expensive and time consuming exercise.

We can sympathize with the dilemma a new dealer faces in trying to allocate those start-up funds. As we tried to look at this issue from the dealer’s perspective, we looked for new ways we could price our dealership management software that would allow them to purchase a full-featured product from the very beginning without draining that start-up money pool.

Some software companies have addressed this issue with a stripped-down version of their main software that they sell for less. We didn’t want to go down that road. Our mission was to be able to provide dealers with the full version of our software along with a pricing structure that made sense for a new dealer.

We believe we have found the perfect solution. As a dealer grows his business and adds more accounts to his portfolio, his cash flow increases and he is able to afford to pay more for his software. We decided that if we made our software very inexpensive to buy and install initially, dealers would be willing to pay us a little more as they were able to afford to do so. Therefore, Business Builder pricing was born.

Now, a new dealer can acquire our MSP software for as little as $395 up front and $50 per month for support. As his dealership grows and he adds accounts, he will reach 2 different tier levels, 75 accounts and 150 accounts. At each new tier, he will pay a little more license fee and his monthly support will increase slightly. By the time he reaches over 150 accounts, he will be at our normal support level but will only pay as he grows, as long or as little time as that may take.

This innovative pricing structure will help new dealers conserve their capital while still allowing them to get all the features and functions they need to manage their dealership now and into the future. At Constellation, we are committed to the success of BHPH and LHPH dealers and we think this ground-breaking new pricing illustrates that commitment.