10 Steps to a More Productive F&I Process
Dealers frequently ask: “What is the process F&I should follow?” Here is a ten-step customer process any dealership can use to establish a solid foundation for increased profits. Dealers frequently ask: “What is the process F&I should follow?” Here is a ten-step customer process any dealership can use to establish a solid foundation for increased profits.
Step 1: GREET THE CUSTOMER.
By the time the sales manager approves the deal, the customer is most likely anxious and fatigued. Moving into another office with another face can be stressful, especially when the customer does not understand why the move is necessary. The F&I manager can ease the transition by going to the salesperson’s work area to meet and welcome the new customer into the dealership’s family of customers and describe the next steps in the sales process.
Step 2: INVITE THE CUSTOMER TO JOIN YOU.
The F&I manager should now be well on the way to establishing rapport with the customer. Invite the customer into the business center (F&I Office) while you enter some data in the office computer. Even if the customer chooses to wait in the sales workstation until the data entry is complete, the task should take no more than 5 or 10 minutes.
Step 3: ESTABLISH THE CUSTOMER’S NEEDS.
Practice your FORM. Find out about the customer’s Family, Occupation, and Recreation in order to deliver your Message. Is the customer concerned about Security? Peace of mind? Affordability? Convenience? Ease of doing business? Durability? When you engage the customer in a conversation to uncover areas of concern, you will know what needs to address in your presentation.
Step 4: PRESENT PRODUCTS AND SERVICES.
After confirming the customer’s needs, the presentation moves to center stage. Establishing value in intangible products requires the ability to create pictures with words. Since 55% of all communication is non-verbal, a presentation book organized to support word tracks is an effective tool to develop opportunities to ask closing questions. The goal of the presentation is to obtain 7 little yes’s to questions such as “You can see the value in this plan during the years to come, can’t you?” Or “This is important to you, isn’t it?” Use a tie-down question to secure agreement on the benefits of the customer’s protection plan: “I am sure you will agree . . . don’t you?”
If you employ a Two-Visit System, use the First Visit to secure the financing and obtain a credit application. Present and close on products that need to be added to the unit before delivery, such as paint and fiber protection and a security system. This is also the perfect time to present the benefits of RV-specific physical damage & liability insurance. Confirm the delivery date. And line up the customer to bring in all trade-related items and documentation that the lender will require.
During the Second Visit, the customer first completes the vehicle orientation with the technician. The technician, or walk-through person, then escorts the customer to the F&I office so that the manager can take care of the title work and present all the intangible products such as service contracts, credit insurance, coach net, and tire guard.
Use a presentation book to assist with the order of product presentation. A planned presentation maximizes consistent production and minimizes errors in documentation.
Step 5: CLOSE THE SALE.
Summarize the benefits of F&I products and services. Ask for the business. Look for buying signals during the presentation process. Never miss an opportunity to close the sale.
Today’s customers like to be in control of their choices. The best practice is to use a menu as a closing tool. Some menus have three choices; others have four. Be sure to have all the proper disclosures on your menus.
Remember that when you give the customer a choice between something and nothing, the customer chooses nothing. However, when you give a customer a choice between something and something, the customer chooses something.
Step 6: NEGOTIATE THE ISSUES.
Identify the customer’s issue. Is it money or benefits? You will often need to tailor payments or find additional money in the customer’s monthly budget in order to close. Use the power of small numbers. Today’s customers want a choice. They want to be active in the sales process. And they want to be in control of their purchase. If your negotiating skills are rusty, plan to attend my presentation at the September RVDA Convention in Nashville.
Step 7: CLARIFY THE CUSTOMER’S CONCERNS AND CLOSE.
Here’s a great question to use to clarify the customer’s concerns: “Setting aside the [describe the concern], are these the benefits you want to protect your new investment?” You must discover if the true concerns are with products, payments, or terms.
Customers love to purchase the products and services that they need and will use. The best practice is to tailor the packages to the length of time the customer plans to keep the vehicle. In other words, do not push a seven-year service contract when a five-year term will fit the customer’s needs.
Step 8: SECURE THE DOCUMENTATION.
I once saw a sign that read, “The job is not finished until the paperwork is in”. That certainly holds true for F&I. The job is not complete until the documentation is secured and the funds are in the dealership’s bank.
Many managers ask their customers to sign the title work first. Since time is critical and we have only 20 minutes of the average customer’s attention, does it make sense to spend those valuable minutes signing title work?
Step 9: DISCLOSE THE DETAILS.
Full disclosure is the Order of the Land. Again, I recommend that you begin with the most important form and work your way down to the title documentation. When it comes to work promised to the customer, be sure to complete the due bill. If nothing will be added to the unit before delivery, the document should read accordingly: “Dealership to provide an orientation, new owner kit and hitch. No additional work promised or implied.” Both the customer and the sales manager should sign this form. Copies go to the customer and to Service; the original remains in the file. This procedure eliminates the customer coming back to Service to ask, “Where is my _______ the salesperson promised?”
Step 10: OBTAIN THE CUSTOMER’S AUTHORIZATION.
Secure the proper signatures on all the legal documentation. The best practice is to sell first, sign forms second. Ask the customer to sign either the purchase order or installment contract first. In order to satisfy the federal requirement to give the customer a copy of the installment contract before obtaining signatures, follow this procedure:
– Pull the customer’s copy of the contract out in front of the customer and explain that you and the customer have twin documents.
– Set the forms side by side.
– Complete a full disclosure and get original signatures on both the customer’s copy of the contract as well as on your forms. The two extra minutes this will take could save you lots of time and legal grief down the road. I also recommend that during the disclosure process you ask the customer to initial all the F&I products in the margin of the itemization to the transaction section of the contract. The customer should initial all copies, to include the customer copy, the original, and all carbon copies.
Nothing is more paramount than a full and complete disclosure of all the terms and conditions of the sale. This is when you want the customer’s full attention. After these documents are properly executed, the title work and policies are automatic. For what is required, refer to Truth in Lending and Regulation Z.