GPS or Starter Interrupt

Anytime a business owner thinks about a new venture, there are a multitude of issues to consider. For dealers thinking about getting into the buy here pay here business, one of those issues is whether they need starter interrupt systems and/or GPS location systems installed on their BHPH inventories. The two serve very different purposes and can be valuable investments for BHPH dealers.

Starter interrupt systems act as a motivator for customers to pay on time because customers know the dealer has the ability to disable their vehicles. As a result, dealers who use starter interrupt systems should see improved collections and fewer delinquencies. Robby Storey, president and CEO of Paytime, said using starter interrupt systems will “retrain the customer’s payment behavior [so they] make their payment on or before the due date”

Traditionally, starter interrupt devices have two components—hardware that is mounted under the dash and a remote (which typically looks like a small TV remote) that can be stored in a glove box or center console. The devices remind customers when their payments are due—some with audio alerts, some with visual.

With most systems, once a customer makes a payment the dealer accesses the starter interrupt provider’s software, updates the customer’s file and is given a unique numbered code that will work only with that specific starter interrupt device. The dealer then provides the customer with the code, which the customer types in using their remote. Once the code is typed in, the remote communicates with the starter interrupt device, resetting the device to coordinate with the next date payment is due.

If the customer defaults and makes no effort to work out payment arrangements with the dealer, the dealer can disable the starter until payment arrangements are made. If the customer calls the dealer in advance and says he/she can’t pay on the day payment is due, the dealer can allow for a grace period by giving the customer a code generated by the software. With Paytime, as well as other providers, the software is a Web application.

GPS allows a dealer to locate vehicles, which is handy for repossessions. “It’s really a loss prevention solution,” said Clark Swanson, CEO of BlacklineGPS, of the company’s new GPS product for dealers, Seeker. The company has another product, the Snitch, which is portable but can also be hardwired into the car. The Snitch can be reused, while the Seeker is for use on one vehicle only.

Like starter interrupt devices, most GPS devices are mounted underneath the dashboard of the vehicle, while others are installed under the hood. One new function on some devices is geofencing, which allows the dealer to define a geographical area for a vehicle, and if the vehicle leaves or enters that area (depending on how the geofencing it set up), the dealer can be notified.

Nowadays, several companies offer devices with both starter interrupt and location technologies. One such product, which is new to the market, is ResCaP, offered by the Crossbow Group. It includes a communications service in its system in addition to the location and starter interrupt features. When a new customer is set up in the Web-based software system, the dealer can also specify the method used to remind the customer that payment is coming due. Customers can be reminded via e-mail, a call to a cell phone or home phone, text message, or in-vehicle reminders given by the device. Ashley Herndon, co-founder of the Crossbow Group, said, “It’s about changing the customer’s payment habits.”

Depending on their business’ dynamics, dealers may not need both starter interrupt and location features. Dealers need to do their homework before choosing a provider.

Cost Comparison 
• Starter Interrupt - Paytime systems are $120 per unit with quantity discounts available. Plus a flat annual software fee of $120, regardless of how many units you operate.
• GPS - BlacklineGPS’ Snitch is $299 per unit with a minimum purchase of six units. Plus a $15-per-month fee for monitoring.
• Starter Interrupt and GPS - The ReCaP system is $250 with quantity discounts available. There is no additional fee for the communication services.