Thursday, February 01, 2007

F&I Express-Station #2-Process Between Sales/F&I


The second stop on the F&I Profit Express puts us at Station No. 2 to address the interaction between Sales and F&I.

WATCH THE WAIT

When you ask an F&I manager to describe what happens between the sale of the vehicle and the beginning of the F&I process, the manager will likely say, “ I greet the customer, introduce myself, and then the salesperson disappears for a number of minutes -- presumably to verify funds, print registration documents, and answer a few questions from a variety of sources -- all of which appear to be more important than the customer who is waiting, waiting, waiting . . .”

It may help to think of the passing minutes as dollars traveling at a great rate of speed to either the dealer or the customer. The longer it takes to transfer the customer from the sales office to the F&I office, the more the dollars will flow into the customer’s vault rather than the dealership safe.

The meter starts running when the customer says “Yes” to the sales consultant. From that moment, until the process is complete, nothing is more important than the customer and the deal. Sales personnel should neither leave the customer unattended during the Sales-to-F&I transition, nor should the F&I manager attend to any accounting request until the customer is taken care of and off the property. Yes, paperwork is critical and follow-up on contracts in transit is essential to cash flow. However, sales generate paper and cash flow, but without taking care of the customer standing in front of you, there may be no paper trail to follow and no cash flow to manage.

The auto business found that the time span between sales and F&I must be seven to 10 minutes. The closer to seven minutes the better. If the interval is more than 10 minutes, the customer’s satisfaction with the dealership and the F&I profitability both take a dip.

When people wait for service, they get aggravated. Grumpy people have no patience for listening and will not do business with a dealership that is the source of their irritation unless they absolutely have to. And then it is only the minimum; they will use other resources whenever they can.

FIND THE RIGHT BALANCE

The time between the Sale and F&I is an opportunity to set up for success by promising less and delivering more. For example, instead of saying to the customer, “Congratulations on your purchase. The documentation process will only take 10 minutes and we’ll have you out of here,” try this instead, “Congratulations on your selection. Our business manager is on his/her way here to meet you and to review all the sales figures. As with any major purchase, we need to complete some documentation and schedule the vehicle delivery.”

In the meantime, the F&I manager has gone to the sales manager’s desk to obtain the deal and conduct a 30-second conference with the sales manager.

Sometimes the sales department takes the deal as far as it can go, and then they send the unclosed or uncommitted-to-buy deal to F&I. When a process begins with confrontation, disaster is the inevitable result. Moreover, it is the F&I manager who, typically, shoulders the blame. The F&I manager needs to know if a deal is not closed before beginning the F&I process. Although it is important for the business manager to sometimes be a closer, it is equally important for the dealer to remember that an F&I producer’s income is derived from F&I profits, and not necessarily the deal.

Whether the deal is complete or pending, a fully informed F&I manager can appear confidently at the salesperson’s work area with a genuine smile and warm handshake for everyone present, fully prepared to review the sales figures and invite the customer into the F&I office.

TRACK THE TRANSITION

The goal is to conduct a professional hand-off from sales to F&I that maintains the customer’s excitement about the vehicle purchase and facilitates the customer’s willingness to listen to the important choices ahead.

The F&I manager should begin by reaffirming the deal structure with the customer. See the example, below.

Accurate sales figures and a professional hand-off present a united sales face to your customers, and build a successful platform for a one- or two-visit process. See you at Station 3 in the March issue.

SUGGESTED F&I GREETING

Welcome to our family of _____ owners. I am one of the business managers here at Paradise RV Center, and I understand you are purchasing a [new] [previously owned] _____. Congratulations and thank you for purchasing the vehicle from us. Together we will complete all the legal documentation and confirm the delivery date in my office, which is located [down the hall] [across the way]. Before we begin, I would like to verify that I have all the correct information. May I review the sales figures with all of you? (The sales consultant must be present to answer any questions the customer may have about the sales figures.)

The sales price is ____________. (Use the power of little numbers. Say ‘sixty-nine five’ rather than ‘sixty-nine thousand five hundred dollars’.) We are paying _________ for your _________. (Use big numbers here, such as ‘twelve thousand dollars’.) In addition, we need to have a clear title and the estimated lien is ________ (little numbers). The initial payment is __________. Is this check good today? (This is the deposit check and you need to know if the check is good now.) Of course, the documentation fee, taxes, and license & registration fees go to the State.

I have some data entry to do. Please join me in my office while I work on your documentation. I’ll lead the way. Thank you [sales consultant]; we’ll see you again soon.

RV Executive Today, February 2007