In the last few years, both dealerships and car buyers have become more interested in e-contracting. Environmental awareness has a lot of sound effects, but it also has a lot of other benefits that can put dealerships ahead of the competition.
Quicken the funding procedure
Dealers who use traditional paper contracts have to wait a lot longer than those who use e-contracting services when it comes to getting money. Most deals are funded within 24 to 48 hours after an e-contract is sent to a financial institution. Some will send the money as soon as the form is sent.
Paper contracts take a lot longer to make because of the time it takes to ship and process the paper. If dealers use traditional contracting, they might not get paid until a week or more after the customer has picked up the car. When funding is late, it’s a massive problem for dealerships that depend on that money to make floorplan payments.
Reduce dealer interest in floorplans
Most financial institutions need a floor plan to pay off within three to seven days of the date of financing. Because e-contracting cuts down on time it takes to deliver a car, payoffs can be done sooner. This means the car spends less time on the lot, where it can collect interest.
Increase efficiency and cut down on delivery times
Digital tools can help cut hours off of the time it takes to do paperwork every week, which can speed up closing a deal. Car buyers don’t want to spend more time in the dealership waiting for paperwork to be processed, and on average, it takes about three hours for a customer to buy a car at a dealership.
With electronic contracting, dealers can eliminate unnecessary steps by importing customer data from their CRM or DMS into all forms needed to close the deal. With a digital signature pad, the buyer and co-buyer only have to sign it once, which cuts down on time to finish the sale.
Improve your accuracy
Because digital contracts don’t require as many forms to be filled out, sales staff can focus on getting the customer’s information right the first time. Information about a customer stored in your CRM or DMS systems can be used to make a credit application, which can then be turned into a working car deal without any problems.
Reduce costs by abandoning paper forms
Whenever you print a form wrong, miss a signature, or sign in the wrong place, the bank may ask the dealer to start over. So much money is spent on forms that get thrown away because of mistakes. Companies that make software for e-contracting, like Dealertrack and RouteOne, now work with more than 7,400 lender partners and are still adding more.
E-contracting menus are being added to even dealer management systems. It is now straightforward for car dealers to use digital tools in their everyday work. E-contracting also saves money on printer maintenance and toner.
Never concern yourself with running out of contractual supplies
Digital contracting eliminates the need for paper bank forms and paperwork for aftermarket products. Most e-contracting companies let dealers process add-ons like GAP insurance, tire and wheel protection, and extended warranties.
There’s nothing worst than being in a rush to close a deal and realizing you’re out of the proper forms. The real value is now on grab until you can get more, which is frustrating for both the salesperson and the customer waiting to get their new car. E-contracting can help dealers avoid this issue entirely.
lower shipping expenses
It costs money to send out a customer’s contract, but the costs add up quickly when you think about how many deals have to be re-done because of dealer mistakes. Shipping is necessary for dealers, but e-contracting can make it much cheaper.
Make it easier to stay organized
E-contracting saves time and space for filing and reduces the chance of losing customer paperwork. Digitally storing car deals makes it easy to get the data you need from any dealership computer or mobile device with the right software.
Because all legitimate financial firms offer e-contracting, they all have strict steps to safeguard sensitive information. By keeping deals and letters of credit digitally, you remove the risk of identity theft and make sure you follow the FTC’s Red Flags Rule.
Improve overall customer satisfaction
Ratings are critical to a dealership’s success, and the delivery process significantly affects how satisfied customers are. With e-contracting, a customer spends much less time in the business office. According to the Cox 2018 Car Buyer Journey, less than half of consumers (46 percent) are happy with how long it takes to buy a car.
There is always stress to stay competitive, and keeping your dealership as efficient as possible can help you do that. Changing processes isn’t always easy, especially when you believe everything is working fine. The fact is that financial institutions will always move closer to digital platforms.
It costs them money and needs to appeal to people who want to buy a car entirely online. Once you take the time to set up automation like e-contracting, you’ll see a big difference in how well your dealership does, how much money it makes, and how happy its customers are in general.