How We Saved One Dealership Group $500,000 On Their IT Needs

Dealerships face all kinds of expenses just to maintain their basic needs. You need to pay your employees, purchase inventory, make sure you have enough office space; the list goes on and on. In today’s business world, having a solid IT infrastructure is critical to the success of any dealership. And the reality is that having the right IT services in place is as critical to a dealership as having the right vehicles in the showroom.

At VGM Forbin, we work with dealerships to help them realize the importance of having the right partner for their managed IT services. Part of that partnership is evaluating the current IT situation for any customer and looking for ways to make improvements. Through that process, we were able to help one dealership group save over $500,000 on their IT needs.

The Client

Forbin was evaluating the IT needs of a large regional auto dealership group in the Midwest. For our purposes, we’ll call the client “Heartland Auto Company.” Heartland was looking for a partner to manage all their IT needs for a dozen locations spread throughout the region. As part of this partnership Forbin would be responsible for:

Network administration
IT tech support
Security monitoring
Threat mitigation
Employee security training
Email services
Consulting

One of the other key components of our partnership with Heartland was evaluating their hardware, including computers, monitors, routers, and servers. With a simple audit of their equipment, we were able to find them huge savings.

Our Auditing Process

When any customer signs up for managed IT services with Forbin, we perform an audit of our new client’s current contracts. As part of our standard onboarding process, we ask for copies of all bills from the client’s current list of vendors. We followed that same process with Heartland. Our strategy during any of these audits is to find opportunities to reduce costs, improve efficiencies, and eliminate redundancies for our clients.

Where We Found the Savings

As we combed through the bills and vendor contracts, we kept asking ourselves this question:

Why were Heartland’s dealerships paying so much for their IT hardware each month?

As we continued to look through Heartland’s expenses, we discovered they were paying their Dealer Management System to lease the hardware required to run their business. This equipment included network switches, firewalls, servers, routers, and other components for each individual dealership in the Heartland group. The combined cost for managing all that equipment came to over $8,000 per month. Over the 10-year lease, they would spend nearly $975,000. We knew we could help save Heartland money, so we came up with a plan.

Our new strategy was simple. Instead of leasing the equipment, Heartland would buy the equipment. By buying rather than leasing, they would see the following benefits:

They would be able to buy all-new equipment and replace it more often while still saving money
Over the course of the same 10 years, they would spend about $445,000 compared to $975,000.

Simply put, buying the equipment allowed Heartland to improve their equipment more often while saving almost $530,000 over the course of 10 years.

Why does this matter for your dealership?

The savings we found for Heartland came through the standardized process that we offer for any client interested in our managed IT services. Most importantly, this new hardware management plan didn’t cost the dealerships any money. Forbin didn’t make any profits by discovering the savings and recommending the new plan for Heartland. This is just what we do for our partners. We can do the same thing for your dealership. If you’d like to get an idea of how you can find savings, we’re ready to talk. Submit your contact information below to connect with our IT team and schedule your consultation.