Managing a successful dealership requires meticulous attention to every aspect of your business, especially the financials. One area that often escapes scrutiny is the monthly parts statement from your Original Equipment Manufacturer (OEM). These statements can include bundled marketing fees, and if they’re not carefully reviewed, you might end up paying for services you didn’t authorize or that aren’t yielding benefits for your dealership.

This guide will walk you through how to examine your parts statement for marketing charges, identify discrepancies, and understand why taking charge of this aspect is crucial for your dealership’s profitability.

Understanding Your Dealership Parts Statement

A dealership parts statement is a monthly document provided by your OEM that outlines all the parts purchased, associated fees, and charges for OEM-related programs. These programs might include co-op advertising, marketing initiatives, or subscriptions to various services.

Regularly reviewing this document is essential to ensure its accuracy and to confirm that you’re only being charged for agreed-upon services. Marketing fees can be subtly embedded under vague terms, making them easy to overlook if you’re not vigilant.

Common OEM Marketing Charges

OEMs frequently charge dealerships for various marketing programs, such as digital marketing services, promotional materials, and co-op advertising. While these programs can offer value, there are instances where the charges don’t align with your agreements or fail to deliver a return on investment (ROI).

Common marketing-related charges you might encounter include:

  • Co-op Advertising Programs: Fees for participating in joint advertising efforts with the OEM.
  • Digital Marketing Services: Charges for services like website hosting, SEO, paid search, or social media advertising managed by the OEM or a preferred vendor.
  • Subscription Fees: Recurring costs for tools like CRM software, customer data management platforms, or email marketing services.
  • Event Sponsorships: Costs associated with manufacturer-led events, local promotions, or media purchases.

Steps to Review Your Parts Statement Effectively

  1. Identify Marketing Fees: Carefully scan the line items in your parts statement. Look for terms like “co-op advertising,” “digital marketing,” or “program participation” that could indicate marketing or advertising charges.
  2. Cross-Check Against Agreements: Match any marketing fees with your existing agreements with the OEM or third-party vendors. Verify that the charges reflect the agreed-upon services and pricing.
  3. Assess ROI on Marketing Spend: Evaluate whether the marketing charges are delivering value. Are these initiatives generating leads, sales, or increased brand awareness? If not, consider renegotiating terms, opting out of ineffective programs, or reallocating your marketing budget to more fruitful channels.
  4. Seek Clarification When Needed: If you spot any discrepancies or unexpected charges, reach out to your OEM representative for clarification. Mistakes can happen, and a prompt inquiry can resolve issues and prevent overpayments.
  5. Monitor Changes Over Time: Maintain a historical record of your monthly parts statements. Tracking marketing fees over time can help you identify trends or sudden increases in charges, providing leverage in discussions with the OEM if costs rise without corresponding benefits.

Avoiding Common Pitfalls

To ensure you’re not overpaying for OEM marketing, be mindful of these common mistakes:

  • Neglecting Regular Reviews: Don’t let statements accumulate unchecked. Reviewing them monthly allows you to catch and address issues promptly.
  • Overlooking Performance Monitoring: Spending on marketing without tracking its effectiveness is wasteful. Keep tabs on the performance of each OEM marketing initiative to ensure you’re getting a solid ROI.
  • Assuming All Charges Are Accurate: Errors can and do occur. Always verify charges, even those from the OEM, to ensure their accuracy.

The Importance of Vigilance

Every dollar spent on marketing should contribute to your dealership’s success. If you’re investing in OEM marketing programs that aren’t delivering measurable results, you’re diverting resources from more effective opportunities. By meticulously reviewing your parts statement and scrutinizing marketing charges, you can take control of your marketing expenditures and enhance your dealership’s profitability.

In today’s competitive market, where digital marketing and local SEO play a pivotal role, it’s crucial to allocate your budget to initiatives that drive growth. Staying vigilant helps you avoid unnecessary costs and maximize the impact of your marketing dollars.

Conclusion

Your dealership’s parts statement isn’t just an administrative formality—it’s a vital document that can reveal hidden marketing fees draining your resources. By proactively examining your parts statement for marketing charges, ensuring they align with your agreements, and monitoring the ROI of these programs, you can prevent overcharges and optimize your marketing budget.

Knowledge is power in dealership management. Stay informed, take control, and make sure every dollar you spend propels your dealership toward greater success.