By Stacy O'NealDirector of Sales, Dealer Services Network
Dealerships create thousands of documents every day, from deal jackets and repair orders to parts tickets and accounts payable paperwork—it's an endless stream. Managing these documents is cumbersome and time-consuming, as dealers know very well.
Even with a process in place, whether it be staff turnover, vacations, or simply human error, all of this can lead to instances where critical paperwork goes missing.
Consider these real-life scenarios: I recently spoke with a dealer involved in litigation who could not locate the customer's deal jacket and another dealer who failed an FTC compliance audit due to missing deals. These are not isolated incidents.
To avoid such situations, dealers need to have an ironclad process in place. If that's not possible, perhaps consider outsourcing to a company that can help.
Identifying The Problem
The first step in creating an efficient document archiving process is identifying problem areas. The most common problems with document management I see in dealerships include the following:
Too Many Hands. How many staff members touch a deal jacket? For starters, the salesperson, the desk manager, the F&I manager, the accounting staff, and possibly the receptionist or cashier. With the FTC Safeguards Rule in place, the number of people with access to deal jackets is concerning. You want as few hands on this information as possible. This is not just about efficiency; it's about safeguarding your dealership's operations.
Lack of Organization. Documents that are relatively recent, within the last year or so, are most frequently kept on-site in large filing cabinets, taking up a lot of valuable office space.
Older files typically get transferred in bankers boxes to an offsite storage unit. That paperwork is shredded after the requisite number of years, which requires another timely, organized process. The problem is that an employee can come up with an efficient system to organize all these files only to then leave the organization. Current staff members might not know how the past files were organized. Then, the new person sets up a new system, and so on.
Additionally, when a file is retrieved for a reason, it often sits in a desk drawer for an extended period of time and is not always returned to where it belongs.
Disgruntled Employees. Another dealer I recently met with let go of an employee and soon discovered that person left with 20 deal jackets in their possession. Other employees then had to go through the arduous process of re-creating those deals. Additionally, the personal and private information in the missing deal jackets is who knows where, which is a direct violation of the FTC Safeguards Rule.
Not Enough Space. When staff gets too busy to make trips to offsite storage, they tend to store boxes wherever there is room. I have witnessed boxes of documents stored in parts and service, which creates frustration for the parts and service managers who want their much-needed space back.
Too Many Work Hours. When paperwork does need to be retrieved, it can take countless hours of searching. Now that the FTC Safeguards Rule is being tightly enforced, most dealerships will be audited at some point. If an auditor comes in and asks for 175 deals, how many employees will have to drop everything and spend a day or two in storage?
Digital Archiving is the Answer
Most dealers have realized that digitizing documents is the answer. With a digital document system, every piece of paper is scanned and stored online. All that's required is to enter an RO number, a deal number, a last name, or a VIN, and you can locate and retrieve files within seconds.
By digitizing your documents, it's possible to downsize and eventually eliminate offsite storage altogether. This is especially useful for specific paperwork, such as termination documents, which must be kept forever.
While dealership management systems (DMS) offer document archiving solutions, document scanning and organization still rely on dealership staff. When things get busy, employees often let things slide or scan in a hurry, leading to illegible documents and missing pages.
When a deal jacket is assembled from the various parts of the DMS, including sales, F&I, and accounting, dealers don't have a QC department or person to verify that every piece of the deal has, in fact, been scanned cover to cover. Additionally, when staff scans paperwork in-house, dealers are still liable for any protected information in those documents.
Outsourcing Solution
All these factors make adhering to a process for in-house document management very challenging and often as time-consuming as traditional paper storage methods.
Outsourcing your document management process is faster, easier, more compliant, and ultimately, less expensive than an internal process.
Partners specializing in this area focus 100 percent on getting the process correct and compliant—it's literally all they do. They organize, digitize and ensure that every piece of paperwork is legible and retrievable.
If your dealership is having difficulty creating or executing an efficient in-house document management process, outsourcing could be a viable option for you to consider. In addition to reducing storage and shredding costs, you'll eliminate the headaches, work hours, and worries an inefficient process creates.
Stacy O'Neal serves as the Director of Sales at Dealer Services Network, overseeing sales and account management teams across eight states. Her two decades of expertise extend to automotive advertising, tag, title and registration, and document archiving and compliance.