1. The initial contact with the customer, prior to bringing in to your office, should be in the salesman’s office. A brief interview should take place. The interview should be a brief rapport building session, followed by questions as to things that may be important to them.
A. “My name is John Doe. I am the business manager. I have the obligation of securing all of your state and federal paperwork, as well as providing you with some very important information as to the available products for your new unit.”
B. How will you be using your vehicle? Commuter or long trips? Business or pleasure?
C. How long do they plan on keeping the unit?
D. Is there anything in their previous credit history you need to know about, prior to submitting the application. (This is assuming we have not done any preliminary approval)
E. I want to make sure all the information is correct on the paperwork. Will you be titling it in one or both names? Is the address and phone numbers on the worksheet correct?
F. Allow me to verify that these were the numbers that you agreed upon so I can accurately do the paperwork.
G. Thank you for the information. Give me a minute to put some paperwork together.
2. Return to your office to prepare the paperwork and the menu. When ready, invite the customer back to your office for completion of the paperwork.
A. “Congratulations on your new purchase. Before we get started, did your sales person do a good job for you? Did you get a chance to see our newly remodeled parts department? Did you see our service department? We have certified technicians who are factory trained to take care of any concerns you may have during the course of ownership.”
B. “As part of the new privacy act, it is my obligation to explain and show you products that are available to you to protect you and your unit during the course of ownership. Please be aware that all of these products are available to you at your discretion. You are not required to take advantage of any of them. We do know that, based on our previous customers, they can be a real benefit to most people.”
C. “We have broken them down into packages to allow you to take advantage of discounts if you take advantage of more than one product. The products are in no particular order of importance.”
3. You now disclose the product and do a feature and benefit presentation on each product. I will briefly tell you how I like to present them.
4. “Folks, I am going to review each product that is available to you. At the end, we can talk about how easy it is to get these important coverages. Fair enough? Great. Let’s get started.”
A. “To protect YOU from future expenses on your unit, and to help you hedge yourself against inflation, we offer an extended service plan. This plan basically extends your factory warranty out for up to 7 years. The initial investment, which can be applied to your monthly payment, will insure that you will not have to worry about paying for any major repairs for the next seven years. Although we always encourage our customers to come to us for any repairs, it is comforting to know that the extended service coverage is good anywhere in the continental United States.
B. “Also to protect you, we offer GAP coverage. Simply put, this product is designed to insure that, in the unexpected event of a total loss of your unit, you will not have to worry about any out of pocket expense. If the insurance company offers to pay off your unit for an amount less than what you owe, the “gap” coverage will make up the difference. In addition, it pays up to $1000 of your insurance deductible. You certainly can appreciate that coverage if you ever have known anyone who has had to off a balance on a car or RV that had been totaled out.”
C. “Now, to protect the UNIT, and to keep it looking as good as it does today, we have an external environmental protection package that will keep your exterior looking like new regardless of the weather conditions you use it in. In addition, the interior protection protects the carpets and upholstery from stains that may occur. Included in that coverage is what we call road hazard protection. This will cover your tires and rims from any damage that may occur.”
Most people take advantage of the total package. As I told you, your base payment was $XXXX. Including all of the coverages, it will only increase your monthly investment by $XXXX per WEEK. (I like to break out that number by the week just to ease the pain a little) Makes sense, doesn’t it?
At this point SHUT UP and let them respond. Then, if they hesitate or refuse, ask why. “Is there something I did not explain well enough?” “Is there a product here that you did not see the value in? I could eliminate that product. I just hate to see anyone lose out on the opportunity to include these items in your payment. It allows you to have a fixed cost as you enjoy your unit. You will not have to worry about any unexpected bills. Does that make sense?” Keep pushing.
What are some closing techniques you've used in the finance office?
Great Article, Ralph. I’m gonna Shut Up now.
A lot of great information in the blog. At the end, I prefer to break down the difference in the smallest possible unit which would be a per day add to the payment. For instance, “Mr. Customer, that is only $1.37 per day which is about the price of a soft drink out of the drink machine.”
Also, the key to selling products in F&I is getting people to picture themselves actually using them. I love brochures when selling VSC and will point out relatively common issues like starters or turn signals as opposed to engines or transmissions. People have a hard time believing the brand new car they are buying will have an engine blow up on them. Ideally, if you can get some copies of shop tickets showing how expensive they things are to replace, your penetration will climb!!!!
Love that Rob, thanks
Hmmmmmmmmmmmmm………….
Marv we would love to hear your take on all of this…
Craig, I probably should keep my fly trap closed here but the urge to say what’s on my mind is irresistable.
I’ve tried every approach in my career from interviews on the lot to drawn out interrogations in my domain and it simply doesn’t work well for me. I’ve memorized all the great word tracks and the so-called rapport building “techniques” taught by the best trainers in the business. While it looks great on paper and sounds delicious in a training seminar in real practical application the approach builds a brick wall of resistance faster than a team of bricklayers can possibly hope to compete with.
Very few people who enter a showroom these days are ignorant of the sales or F&I process and what’s about to happen in any step along the way. Salespeople build rapport because they can’t be trusted by customers yet our role is quite different. Our job is to project credibility in the mind of the customer because we’re handling their delicate personal information. They aren’t interested in answering a bunch of questions they already had to answer to the salesperson. They’ve already made a decision to spend $30K and now they’re looking for you to provide the most efficient method of paying for it.
Don’t blow it by sounding like someone who’s trying to butter them up by making friends. They won’t spend enough time with you to accomplish that. They want the facts and it’s our job to supply them. Now, I’m not talking about being rude and insensitive here. I’m saying that a 5 minute diatribe underlining your reason in their lives and a 20 question interrogation (or conversational interview if you prefer) isn’t needed.
Most of the information you will need to make a qualified presentation is contained in the information you already have namely the buyer’s order and credit report. These docs contain trade miles/time they kept it, their age for a life presentation, how much negative equity for GAP etc. If you offer Tire/Wheel or a maintenance program there really isn’t any questions that would apply.
Based on the facts you already have construct your presentation and jump right in. The customer will appreciate you not wasting their time with useless questions you already have the answer to. Let them decide and answer any questions or concerns they may have about the products and close the deal.
Interviews are great for some people but I believe after you’ve acquired some experience the less said the better. In any event you know your market and yourself better than anyone else so if you are doing better by conducting in-depth interviews AND your numbers are satisfactory then don’t fix what ain’t broke.
In the infamous words of George Angus “You can dress up in a clown suit, write your menu on a roll of toilet paper and if you’re good you can sell F&I!” I wouldn’t recommend this approach but I feel certain there is an F&I Manager somewhere that may be doing things differently and unconventionally albeit compliantly that is running great numbers with great customer satisfaction.
The lesson for me is not to get hung up on one particular idea or method. Always be willing to try something different.
I couldn’t agree more Marv. I’m telling F&I Managers that credability and trust are more important than making freinds now. I too think it varies somewhat depending on your market and I also see value in meeting the customer at the salespersons desk. But if your gonna start askin product specific questions you better also be ready for the resistance you’ll instantly encounter.
Just ask any F&I Manager what goes through they’re mind when a salesperson tells them,”hey these people are really interested in a service contract, I’ve got this one really set up for ya!”. What happens when the customer comes in and the presentation starts? “Oh yea, our salesman told us about that, and we don’t want it”.Frankly, I’d rather have the salesperson tell me the customer already said they didn’t want to buy anything in the Finance office.
I’ve come full circle on this thinking though. For years I taught, enforced, and spiffed salespeople to ‘set up’ the finance office. When I learned Menu Selling I was taught to go out and ask all those product specific questions. When I started teaching F&I I taught to go out and meet the customer and do the same thing. I Even produced Power Point presentations and held web training on it.
But,does it make sense to use techniques that are 15 plus years old on todays customer?
Klay
We appreciate all your input and sharing that knowledge.The last line that you wrote I feel says a lot!
Thanks
It’s tue that having a consistent game plan to engage a customer going into F&I is important. This example of the customer interview is just as good as any other if it is done on the consistent basis. Going to court and not being able to prove that every customer gets offerred the same products is a huge problem (video record every transaction is my recommendation, it’s great for training).
Let’s not overlook the fact that in order to sell the most F&I products all contractors, producers, F&I officers, directors etc., must become the best salespersons first to close the buyer on those F&I products (dealership specific) The goal is get that monthly payment as high as possible – they will thank themselves later. After this is accomplished the F&I person must transform into best paper seller (or T.O. the deal to a director) to get the entire deal approved by the lender.
A big mistake happens when the F&I department plays director first and gets the deal approved, conditioned, or qualified a certain way and now the selling to the buyer is altered by the lender. The buyer may not receive a complete F&I pitch. The thought process now, is why pitch the customer something that the lender is not approving? Pitching the customer based on what the lender is dictating to you really sucks because the dealership’s consistant offering of all the F&I products is out the window (bad situation in court). Structuring a deal for any one customer is illegal based on the “carryback” amount permitted by a lender in many states.
What I am describing here is that by offering and selling every F&I product to the customer first will prove that everyone gets the same opportunity, and even if the dealership has to remove some thise F&I products later because of the lender’s qualification, the dealership has proof that the customer wanted them and many times can be sold on the side through an interest free 12 month contract. This opportunity will never happen unless or until your F&I department recognizes the more effective way of becoming the best contractors first and then the best directors second. Also, getting the customer recontract at a lower monthly payment may even improve CSI at this point.
Finally, all these banks representatives that come to visit your F&I personnel will better serve your dealerships by talking to your sales managers and salespersons instead. In most dealerships these days, by the time the deal gets to F&I, the deal is already structured a certain way. These salespersons and sales managers can be a lot more effective if they better understood your lender’s approval guidelines. Great processes is equally as important as talent!
Agustin Vasquez, Jr.
Wow…I mean WOW, Agustus… It seems as if you’re structuring your entire F&I presentation according to case law and court documents.
There are so many points on which I disagree with you that to begin ticking them off in a point-counterpoint response would take pages.
Let’s just look at a couple, “The goal is get that monthly payment as high as possible..” I disagree. The goal is to 1.) Establish credibility and 2.) maximize profit. Not every customer will qualify for every product in your offering. Buying into the “but the guru said it,” mentality of the 400,500 or 600% rule is, in a word, simplistic. If you’ve been to court, (and it seems like you have), offering multiple products to every customer under the sun and packing up the payment without regard to the customer’s situation or ability to pay is one of the quintessential things that’s wrong with this business.
A good F&I will do several things at once in the office. Loading the deal with product and selling everything without consideration for the lenders advance guidelines is straight out of the “I’m a rookie” playbook. Then, as you suggest, “Also, getting the customer recontract at a lower monthly payment may even improve CSI at this point.” Agustin, exactly how will reeling a customer back in to change the terms they agreed to lead to improved CSI?
In many states, once they sign for it, they own it. If you were to call me and say, “Hey, I got great news for you! I need you to come back and resign a new contract at a lower payment!” then I can assure you that any credibility you had would be flushed at that point. I’d tell you, “Nope..I’m happy with what I got, thanks,” and you end up holding the paper.
The whole tone of your response is geared to “what happens the next time I get hauled into court and have to prove I offered everything to everybody every time without fail?” If you indeed follow the process you’ve described, I’d be curious to see what your held offerings are, your CIT’s and your CSI. Reputation with your partner lenders is as critical as your reputation with your customers.
It sounds like you’ve got a lot of extra paperwork on your hands and a lot of return visits from customers due to a lot of rookie mistakes.
I am fairly new to F and I. I have been working in a Toyota/Hyundai franchise for 3 years. I have consistently maintained a 700-800 pru and Green CSI. I felt like my income had flatlined! I did the “pre-interview”, I built rapport, I had the customer signing all the “non-financials” before we got to the menu to allow for even more rapport building. I heard stories of 1000 plus PRU stores and I, for the life of me, could not figure out how they did it. In comes Mr. George Angus! Stop the pre interview, stop trying to build rapport, start becoming an authority and build some credibility. Dive right into the numbers and make sure they are correct. Offer 3 packages, ask them which they prefer, shut up and let them pick. 1 MONTH into the program and customers are happier than ever and my department made more money than ever in the history of the dealership! we finished at 65% service contracts, and 1161 p/c, we had a total of 165% product penetration! My boss flipped when he found out how much he was going to pay us this month but I told him to get used to it! Thanks George
Outstanding job!!!!!