5 Ways Car Dealerships and Auto Parts Stores Benefit from Automated Cash Management
Find out why automated cash management matters to the car industry and how this solution can drive your organization’s transformation.
As essential businesses, car dealerships and auto parts stores must be ready to accept all forms of legal tender, especially cash. Efficient cash handling is a necessity because these merchants serve a broad spectrum of consumers—from the banked to the unbanked to entrepreneurs who operate cash-intensive businesses and to those who just prefer to pay with bills. However, the cost of handling cash can be high when you consider the labor, time, potential for human error, and security risks involved.
A widely shared stat from IHL Group suggests the average retailer spends 9.1% of the value of their cash transactions counting, recounting, auditing and depositing cash. How is your business managing these costs?
The car industry is ripe for automated cash handling. Through cash automation, dealerships and auto parts stores can optimize and better secure their cash operations, while giving time back to their valuable employees.
What Is Cash Automation?
In simple terms, cash automation entails a middleware application integrating with your cash recycler and your point-of-sale (POS) system or dealer management system (DMS) to accurately track and secure cash transactions. This networked cash management solution enables automated bill dispensing, exchanges, and deposits and makes balancing fast and easy. Additionally, it offers real-time cash visibility across locations and devices.
Car dealerships and auto parts stores with a considerable flow of cash transactions can benefit from automated cash handling—a solution that’s best implemented with a cash recycler, not a traditional or smart safe, to enable secure access to cash on hand.
What Are the Benefits of Cash Automation?
1. Greater efficiency
Traditional cash management processes are time consuming and labor intensive. For the average retailer, the processes of counting and recounting cash to provision start funds, make change, prepare bank deposits, and reconcile to total net receipts at the end of the day consumes a lot of staff energy and time. Modern retail organizations need a streamlined way to handle cash.
What happens when a cash automation solution is at work? Dual verification of cash counts becomes unnecessary as the trusted technology quickly performs this task. For example, the time it takes to prepare a cashier's till is reduced to mere seconds, as the recycler accurately dispenses the preset denominations for start of day. Reconciliation against the POS happens at a faster clip and with greater accuracy and an audit log, freeing managers and supervisors to handle more strategic work. With a robust cash automation platform, managers gain 4 hours of time back per day to focus on more activities that support business success.
2. Greater Security and Less Shrinkage
Auto parts stores operate similarly to traditional retail stores. They have one or more registers or tills and follow standard cash/in or cash/out procedures. Car dealerships, however, have cash operations that span the showroom and the parts and service department. As a result, a lot of different types of employees may be handling cash frequently.
Despite their unique settings, both types of businesses can leverage cash automation to achieve better control and security over cash operations.
With cash automation, you can implement a culture of accountability that not only facilitates process compliance but also helps to reduce shrinkage. Cash automation lets you know how much cash you have, who has touched it, and where it is—all while authenticating bills and providing an accurate, real-time accounting of your money.
3. Better Compliance
With anti-money laundering regulations, car dealerships in particular have to scrutinize large cash payments from customers. Any time they receive a cash payment over $10,000, they have to file a Form 8300. For some dealerships and or body shops, these transactions occur frequently. The IRS provides comprehensive guidelines; however, without the right guardrails in place, a dealership can potentially go afoul of these laws—not to mention lose track of the cash.
A cash automation platform offers the ability to secure and track cash payments from customers so it's easy to know when it's necessary to file Form 8300. Plus, you'll be ready for any audit.
4. Superior Cash Planning and Visibility
Cash in transit fees, change orders, deposit fees, and other charges eat away at your bottom line. However, a cash management platform can help you reduce those expenses.
With an end-to-end system, retailers have up-to-the minute intelligence of the cash on hand. It’s easy to segregate large bills and plan for cash in transit (CIT) services and keep cash on hand, secured in their recycler, to reduce the frequency of these services. Depending on the capacity of your recycler and cash transaction velocity and size, you can store enough bills to last several days to weeks. A robust system will have functionality that gives CIT personnel secured access to your recyclers without the involvement of your personnel. That means work is not interrupted every time the armored truck arrives.
5. A better employee productivity and engagement
An automated cash handling platform gives employees peace of mind that their drawer will balance at the end of the day. With the stressful post-sale administrative function of counting cash off their to-do list, they can do what they signed up for: serve your customers and drive marketing activities. That’s an important outcome during this current labor shortage, when it’s critical for businesses to get the most out of the workers they do have.
The efficiencies your dealership or auto parts store can gain with a cash automation solution far outweigh its costs. Within 12 months, most retailers recoup their investment and start seeing a return on investment every month as their cash operations run more efficiently.
Your Path to Automated Cash Handling
Whether you're running a full-service dealership or an auto parts store, it makes sense to remove all barriers to growth and success. Cash automation can empower you to lessen the financial, administrative and security burdens of handling cash. The experts at Avivatech can help you find out how this solution can transform your cash operations. Let’s schedule a meeting to discuss your situation.