For $400 you could get a pretty good ILM product, but definitely not a worthwhile CRM. Cheapest CRM price I have ever seen was around $800.
I would recommend looking at different vendors and comparing while thinking about your short and long term CRM needs. Some have a lot of functionality/add on modules so you could start simple and grow. While some are very simple and don't have any add-on functionality. It just all depends on what you are looking for.
Here are some of the major features to look for of a complete CRM solution
Overall ease of use for salespeople
Inventory integration - Do you have access to all your inventory including full details, pricing, pictures and more (Would be good to know what you are selling.)
Internet lead functions - Can you easily email pictures and details about your inventory?
Showroom traffic - Can you track the activity that occurred in the showroom and do unsold follow up based on it?
Mobile CRM - Responding to leads from a mobile device is a must have. Manufacturers are about to require it.
Desking integration - If you want the managers to use the CRM, it better have good desking
Vehicle Valuations/Book out - Does it allow you to do trade appraisals and price inventory?
Reporting - Are there a lot of reports and can you build your own custom reports?
Marketing Campaigns - Can you mine your data to market to unsold, sold, and service customers?
Service department - Does it pull in service ROs for follow up and so you can see customer value
Phone PBX integration - Does it track inbound and outbound phone calls?
Dealer group functions - Centralized BDC/internet department functions, plus dealer group reporting
I'm sure I forgot some things.
As you can see... a full CRM has a lot of functionality. A fully featured CRM could integrate with over 100 other vendors and products. It is expensive and complicated software to create, maintain, and support. You get what you pay for.
I wouldn't expect to find a good CRM under $1,500 a month. There are also a few vendors that don't require contracts.