Making F&I profitable without an F&I manager
May 10, 2010
Filed under Contributing Blogger
Jan Kelly, president, Kelly Enterprises – Many dealerships have downsized their personnel to the point of not having a dedicated F&I manager. Is that department just as profitable without the dedicated person focused on the task each day? Who is presenting the ancillary service policies, and working with the lenders to secure the customer financing?
Some dealerships have simply outsourced the F&I jobs. While this may be a short-term solution, it can have long-term liability for the dealership.
Still other dealerships have changed their business model to mirror that of an equipment dealership. The sales associates incorporate the ancillary policies into their demo of the unit. They talk early and often about the additional protection, and they provide an itemized quote after the demo is completed.
This does require additional education of the sales associates. They must learn how to demonstrate an intangible product and services, which – by the way – requires a different skill set than demonstrating a tangible item, something the customer can see, touch, and in general use all of their normal senses.
Part of the challenge is having the sales associates gain personal testimonials on these particular ancillary products. If they do not see them as value-added items, they simply will not talk about them with a full heart, and the end result will be little additional sales. Revenue will be minimal at best.
How does the sales associate gain a personal testimony of these products? Show them lots of copies of claims that have been paid. Supply them with examples of paid service contract repair orders. Yes, you will need to block the identity of the customer for privacy issues.
Proper education, implementation of a solid presentation strategy and belief in the value of the ancillary policies and services will build customer retention and customer satisfaction. Sales go up, profitability goes up. It becomes a win-win for all parties.
As with any presentation, the new and improved sales steps will need to be practiced many times until it becomes second nature to the sales associate. Practice with other sales associates; practice with venders; do not practice on live customers.
Write up some real-time scenarios to be used in the practice, drill and rehearse sessions. Perfect practice prevents poor performance. Practice until you are comfortable. Practice until it is like breathing. We all breathe without thinking about taking a breath. It is natural.
Jan Kelly, president of Kelly Enterprises, is an educator and consultant, convention speaker and writes frequently for industry publications. For information about educational venues or joining an F&I 20 Group, call 800.336.4275 or visit www.JLKelly.com.