F&I in Age of Car Dealerships’ Contactless Transactions

Even before the COVID-19 pandemic, friction in the F&I office was a customer issue.

Tim Blochowiak

May 20, 2020

3 Min Read
online car buying
Paperwork must be completed online through F&I and therefore it is imperative that each dealer has a robust and reliable online contract process.Getty Images

Since the widespread containment efforts caused by COVID-19, auto dealerships have been among the hardest-hit industries.

Much of this is as a result of many dealerships either being forced to close or limited to online sales. If they’re still open, the virus crisis has limited showroom foot traffic.

This means that contactless transactions are, at least for the near future, priority No.1 in the transaction playbook for dealers. Because of this, F&I must play a leading role in helping educate people online during the research, transaction and post-sale phase of each sale.

Where F&I Can Help the Online Process

If they weren’t focused here before COVID-19, dealers are now full speed ahead with online digital retailing options for customers. As part of this, more dealers are beginning to leverage additional online education of F&I options when shoppers are beginning their research online.

Dealers (and lender partners) want to make sure customers are matched with the right vehicle, loan and terms up front. When it comes to additional F&I options, dealers want to leverage the online experience to remove any friction that historically was perceived to take place toward the completion of the deal inside the F&I office.

While many F&I options can be beneficial to a car buyer (such as vehicle service contracts and ancillary protection plans), the customer may perceive these products as “upsells” at the last minute inside the F&I office.

Even before the COVID-19 pandemic, this friction was an issue. According to a recent industry survey, approximately 87% of car shoppers disliked some aspect of car shopping at dealerships, with the majority saying they felt pressure to buy right away or to buy additional F&I features.

This pressure and mindset are reduced when car shoppers have information ahead of time on F&I product options. This allows them to research the benefits of these products in the comfort of their home, as opposed to being in the F&I office where they don’t have time to make proper considerations.

Completing the Transaction Outside of the Dealership

F&I can also be a great benefit to the contactless transaction at the completion of the deal and when the consumer then takes ownership of the delivered vehicle. Paperwork must be completed online through F&I and therefore it is imperative that each dealer has a robust and reliable online contract process necessary to complete each transaction outside of the dealership.

This “new normal” will certainly be critical for all involved – dealers, lenders and customers – in the near term, but the COVID-19 pandemic may also serve as a catalyst for longer-term change.

Tim Blochowiak_0.jpg

Tim Blochowiak_0_0

Contactless transactions will continue to grow as dealer sales and F&I personnel are forced to work from home, and as consumers are wary of visiting dealerships in person. (Tim Blochowiak, left)

Having the necessary digital retailing tools and resources available will not only help sales grow again, but over time it will help dealers build trust.

Tim Blochowiak is vice president-dealer sales at Protective Asset Protection, an F&I provider and trainer.

About the Author(s)

Tim Blochowiak

Tim Blochowiak is vice president of Client Wealth for Protective Asset Protection.

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