“THE WORKS” PARTICIPANT #3: BiT Dealership Software
(EDITOR’S NOTE: This is another in a series of articles spotlighting companies competing in this year’s “The Works” growth accelerator operated by the Knoxville Entrepreneur Center {KEC}. The teams will have their “Demo Day” on September 20 as part of the second annual “Innov865 Week.” To register, click here.)
By Tom Ballard, Chief Alliance Officer, PYA
We had not caught-up with Ed MacFawn of BiT Dealership Software Inc. since late 2014 when we interviewed him for this two-part series (Part 1 and Part 2) on teknovation.biz.
“We were still in the early stages of selling the cloud-based version of our software,” the company’s Chief Executive Officer (CEO) said in relation to that earlier interview. Today, much has changed at the small, but profitable enterprise MacFawn purchased in 2005. BiT Software develops and markets an integrated management software suite to dealerships selling everything from boats to motorcycles, ATVs, PWCs, and golf carts as well as to marinas.
“We have all the functionality of the older desktop system plus new features,” MacFawn says of the cloud-based version. “Now, more than one-half of our revenue comes from the cloud version and more than one-half of our customers use it.”
A key difference for BiT Software’s customers who have adopted the cloud-based version is they no longer have the high upfront fees that came with installing the desktop version. Instead, they simply pay a monthly fee.
“It was a painful transition,” MacFawn says of the cash flow effects of converting to the new model. The results, however, are proving that it was the right decision. One is the greater efficiency it provides in the use of BiT Software’s personnel.
“We don’t have the time-consuming onsite set-up requirement,” the CEO said. “Now, with the cloud version, we have added more customers in a month than we did in a year with the desktop version. Revenue grew 30 percent last fiscal year, and we are on track to grow another 50 percent this fiscal year that ends this month.”
MacFawn admits the change did not occur without some trepidation.
“In 2014, I was excited about the future but saw some risk,” he said. “Now, I’m even more confident in the future.”
Geographically, most of BiT Software’s customers are North America-based and the majorities are in the marine sector, although the power sports area is growing. In addition to the U.S., customers are mostly located in the Bahamas, Bermuda, Canada, and the Cayman Islands. One reason for this concentration is technical support that is easier to manage in time zones more aligned with the U.S.
“These are complex small businesses,” MacFawn says of his customers that range from mom and pop operations to those with 30 to 40 employees. “We provide a tool to eliminate manual processes while driving sales and allowing the dealership to have clear insight into various aspects of the business like parts ordering, sales, and inventory management. There’s always constant tension about how much sophistication to add to the software without adding complexity.”
Today, the company has six employees including three technical support people, and MacFawn expects to add another support person plus a second developer soon.
Another reason for the CEO’s optimism is the fact that more and more manufacturers of marine and power sports equipment are expecting their dealers to have approved management systems like the product that BiT Software sells. The company was recently added to the list of approved vendors for Bombardier Recreational Products, better known as BRP.
Why is he participating in “The Works”? MacFawn sees the program being particularly helpful in fine-tuning BiT Software’s marketing strategy to drive lead generation as it prepares to enter its busy season of fall and winter.
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