Dealerships handle sensitive data across multiple departments — customer personally identifiable information, credit applications, service history, financing records, and data connected to dealer management systems. When a software or service provider has access to any of that data, the dealer has an interest in understanding how that provider manages and protects it.
SOC 2 Type 2 and ISO 27001 are two of the most widely recognized independent frameworks for verifying that a vendor has documented security controls in place. Both involve third-party audits conducted against established standards rather than self-assessment. The primary distinctions are:
- SOC 2 Type 2 is specific to the United States, governed by the AICPA, and evaluates controls over a defined time period
- ISO 27001 is an international standard applicable across jurisdictions and evaluates the overall information security management system
Neither framework is universally required for dealership software vendors. Dealers evaluating vendors with access to customer data, DMS feeds, or financial systems may request a current SOC 2 Type 2 report or ISO 27001 certificate as part of their vendor evaluation process.