Cox sues CDK, cites anticompetitive practices

[yagoparamo]

In some instances, for writeback RCI access, a vendor would charge me more for Reynolds fees than for their software.

Your point hides even a more terrible truth for the business;

There are lots of vendors with small ideas/tools that would solve those little nuances of this business that haven’t been brought to market because of the artificially increased DMS feed costs.

The entire business had beem up priced for the simple fact of data flow with absolutely no extra benefit to the consumer (dealer).

 

[craigh]

Until dealers suck it up and make the change to an open DMS like DealerTrack, CDK and REY will continue with business as usual. I will be surprised if this suit (if victorious) improves the dealers' world one iota. Likely, it will just mean even higher connection fees after CDK and REY pay their fines...

Don't forget the OEM involvement in all of this.
Many OEMs still force a specific DMS.
OEMs like Toyota Canada will only let 3-4 dealers a year switch off of Reynolds because it's such a mission.

 

[Jeff Kershner]

Don't forget the OEM involvement in all of this.
Many OEMs still force a specific DMS.
OEMs like Toyota Canada will only let 3-4 dealers a year switch off of Reynolds because it's such a mission.

That's some messed up sh!t.

 

[Brendan Dolan]

Your point hides even a more terrible truth for the business;

There are lots of vendors with small ideas/tools that would solve those little nuances of this business that haven’t been brought to market because of the artificially increased DMS feed costs.

The entire business had beem up priced for the simple fact of data flow with absolutely no extra benefit to the consumer (dealer).

It really is sickening from the dealers perspective. I ran a Reynolds store, so we have the huge monthly expense, the capital cost of the server, and then all of the integration fees. You're absolutely right; a small vendor that has a slick product can't get their foot in the door because they aren't RCI Certified, or they can't touch the DMS at all. Super annoying.

 

[Chris Leslie]

The DMS biz is where the real money's at. lol..

 

[Ryan Everson]

I had the opportunity to spend 2 days at Reynolds headquarters a couple years ago as part of Northwood's curriculum. I was definitely surprised by some of the things I heard in their sales training academy. Training salespeople to get dealers to sign 30 years contracts for their DMS and 10 year contracts for Naked Lime's digital marketing services. How do they even know what digital marketing services they're going to offer 10 years from now?

 

[Jeff Kershner]

Preying on ignorant dealers is all that this boils down to.

 

[craigh]

I had the opportunity to spend 2 days at Reynolds headquarters a couple years ago as part of Northwood's curriculum. I was definitely surprised by some of the things I heard in their sales training academy. Training salespeople to get dealers to sign 30 years contracts for their DMS and 10 year contracts for Naked Lime's digital marketing services. How do they even know what digital marketing services they're going to offer 10 years from now?

I agree 100%, but I will say... their campus is pretty epic.
I can tell you where they spend all the money they take off these ignorant dealers.

 

[Ryan Everson]

I agree 100%, but I will say... their campus is pretty epic.
I can tell you where they spend all the money they take off these ignorant dealers.

Yeah if I remember correctly, they had a product demo theater whose walls automatically raise after showing a video and you walk into a mock dealership showcasing their entire product lineup in each dealership department.

I did notice that there were a TON of cubicles empty and they really seemed to track employees' every movement through the use of RFID tags on every doorway (even bathroom area). The recruiting process is also intense with everything they require of applicants, they only hire half a percent of applicants and positions tend to be very underpaid.

 

[AdamMurray]

I had the opportunity to spend 2 days at Reynolds headquarters a couple years ago as part of Northwood's curriculum. I was definitely surprised by some of the things I heard in their sales training academy. Training salespeople to get dealers to sign 30 years contracts for their DMS and 10 year contracts for Naked Lime's digital marketing services. How do they even know what digital marketing services they're going to offer 10 years from now?

I worked for Reynolds/NLM for a few years in the recent past. I went through all of their training, boot camp and ride-alongs. While they certainly push for longer terms on their agreements, I never heard anything about 30 years or even 10 years. We would definitely push for multi-year marketing agreements at NLM but the product mix was fluid. Revenue swaps were common and we upgraded customers all the time to new products and services.

I know the big DMS companies get a bad rap and a lot of it is probably deserved. I will say, though, the sales/management team at Reynolds is the best in the country and trained extremely well and often. A great salesperson is going to start with a lofty ask and sometimes they'll get it.