Extra Sales Without Spec. Fin. Dept.- Part II
There is a tremendous amount of additional income that is often overlooked in a dealership. Too many sales managers spend too much time securing finance deals at the highest APR available, and all too often with less-than-credit-perfect clients.
In today’s marketplace, these customers will make a few payments in a timely fashion before they look for refinancing opportunities. This not only causes the dealership to lose reserve income, it often casts doubt on the quality of the entire deal from the customer’s point of view. The best practice is for dealership principals to determine the acceptable margin they wish to make in reserve and standardize pricing throughout the dealership.
Increased income opportunities in service agreements, credit insurance and core F&I products await proactive personnel. With or without a finance manager, every dealership can implement a process in which every customer learns about the benefits of all available protection products during the final stages of financial documentation.
Presentation Books
Too often, dealership personnel have so many things to sell in such a short amount of time they short cut the presentation, and in doing so, they lose $ales and additional income.
A key to extra sales is to teach the staff to use a presentation book to discuss opportunities with the customer. Since people remember 55 % of what they see, 38 % of what they hear, and 7% of actual facts, a presentation book is a tool to increase the customer’s retention level and create value in the products and services introduced in the F&I process.
The challenge is to convince sales managers to design a presentation book, along with benefits tailored to the 3-4 menu choices the customer has based on the age of the vehicle they are purchasing. The presenter can then review all the payment options with the client. The generic presentation book we have developed promotes consistency and works well with every customer.
Product Groups
Using proper interviewing skills before introducing products and services, the presenter can make significant headway in grouping the benefits in their presentation.
Consider the aftermarket items as one group. These items include interior and exterior protection and a security system. Identify this group as Desert Protection, Coastal Protection, or Valley Protection products. If you consider that all these products are designed to protect the vehicle regardless of what kind of environment the customer drives in or parks the vehicle in, naming this package after the local environment makes sense. Of course for accounting and Regulation Z purposes, all the products need to be disclosed separately, and I know you all understand this point.
Make insurance products the second part of the customer’s protection package. This group would include service agreements, credit life insurance, accident & health protection, and GAP protection.
You might even have a fun pack. This third group would feature an entertainment package, CD changer, and TV – VCR LCD screen that hangs on the headrest to entertain children on those long road trips. A GPS tracking system could complete this set.
You get the idea, now. Check to see what products are available, what products your dealership wants to represent, and get busy creating your special menus. Do you remember the McDonald’s secret? When the customer places an order, the counter clerk asks, “With fries?” The lesson here is that if you want more profit you must ask the customer for the order on every product.
Securing the financing is the first step in presenting all the F&I products and services. In future articles we will discuss how to ask for those extra sales.
World of Special Finance Magazine, November/December 2002, p. 14.