Off-Site Vehicle Inventory Storage

Are you faced with surplus inventory and limited space on your dealership lot? Consider the possibility of storing some of your inventory at an off-site location. With the convenience of online advertising, you can reach a broader audience and potentially expand your inventory beyond what your lot can accommodate. Fortunately, there are guidelines provided by the Division of Motorist Services (DMS) that allow for off-site inventory storage. In this article, we will delve into the details of acquiring and utilizing off-site storage for your dealership inventory.

Storing Inventory Off-Site

When Can Excess Inventory Be Stored Off-Site?

To make the most of your dealership's inventory management, you can store excess inventory at an off-site location. This includes vehicles used for demonstration, those in transit to or from your dealership, loaner vehicles for customers during repairs (ensuring proper insurance coverage), and service vehicles utilized by the dealership. It's important to note that wreckers and tow trucks are not permitted to use dealer plates and should not be considered as service vehicles.

Restrictions on In-Person Customer Interactions

While off-site storage is allowed, it is crucial to prevent customers from visiting the off-site location in person. You can continue to advertise and list inventory at the off-site location online, but all customer activities such as inspections, test drives, and purchases must take place at your licensed dealership.

The DMS Position on Off-Site Storage

Understanding Florida Statutes 320.27(3)

The DMS position paper regarding this topic can be found below.

Subject: Off-site vehicle inventory storage by licensed Florida motor vehicle dealers.

Introduction: There has been lengthy internal discussion on the exact requirements of Florida Statutes 320.27(3), and whether or not this statute allows for off location storage of vehicle inventory by licensed dealers and if so under what conditions. This position document will review the pertinent statute and provide guidance when addressing this issue in the future.

Statutory requirements:

320.27 Motor vehicle dealers.—

(3) APPLICATION AND FEE.—The application for the license shall be in such form as may be prescribed by the department and shall be subject to such rules with respect thereto as may be so prescribed by it. Such application shall be verified by oath or affirmation and shall contain a full statement of the name and birth date of the person or persons applying therefor; the name of the firm or copartnership, with the names and places of residence of all members thereof, if such applicant is a firm or copartnership; the names and places of residence of the principal officers, if the applicant is a body corporate or other artificial body; the name of the state under whose laws the corporation is organized; the present and former place or places of residence of the applicant; and prior business in which the applicant has been engaged and the location thereof. Such application shall describe the exact location of the place of business and shall state whether the place of business is owned by the applicant and when acquired, or, if leased, a true copy of the lease shall be attached to the application. The applicant shall certify that the location provides an adequately equipped office and is not a residence; that the location affords sufficient unoccupied space upon and within which adequately to store all motor vehicles offered and displayed for sale; and that the location is a suitable place where the applicant can in good faith carry on such business and keep and maintain books, records, and files necessary to conduct such business, which shall be available at all reasonable hours to inspection by the department or any of its inspectors or other employees.

According to the relevant statute, the applicant must certify that the off-site location provides a properly equipped office space that is not a residence. It should also offer sufficient unoccupied space for storing all motor vehicles offered and displayed for sale. The intention of this statute is to ensure that vehicles are offered but not physically displayed for sale.

Interpretation and Discussion

The rise of internet-based vehicle shopping has transformed the industry, leading to decreased demand for physical display space at dealer locations. While in-person inspections, test drives, and purchases must be conducted at licensed dealer locations, consumers engaging in "window shopping" through online platforms are less concerned about the physical location of the vehicles. This perspective supports the argument that licensed dealers should be allowed to store excess inventory at off-site locations as long as consumers do not have physical access to those storage areas.

Off-Site Storage as a Viable Solution

By leveraging off-site storage for excess inventory, you can address space limitations and offer a wider range of vehicles for sale. Remember, customer interactions, including inspections, test drives, and purchases, must always occur at your licensed dealership and not at the off-site locations.

For further information don't hesitate to contact Auto Legal Group here.