The end of the year is near, which means it’s time to assess the state of your business and plans for 2016. This includes developing a forecast for future business and a plan to create a cohesive team and workflow across your dealership.
One of the most important drivers of profitability in your dealership is the F&I department. This is where deals are bought, profitable protection products are sold and delivery of the vehicle is ensured.
To take your dealership to the next level, don’t think of F&I as another department. Instead, consider adopting a culture of F&I throughout the dealership. Your success depends on it.
This means extending an F&I mindset across sales and service, and getting employees on board to believe in and accept the value of the F&I process and products as a way of doing business. Impart this F&I culture on everyone, including the showroom and service drive.
Educating Sales Team
Your sales team understands customer behavior and knows that many coming through your doors work on a strict household budget. When the sales department adopts a culture of F&I, it can better tap into these behaviors and explain how a vehicle service contract (VSC) can help the customer stay within a budget when the car unexpectedly breaks down.
The sales team also can better explain how GAP protection can ensure customers are able to pay off their vehicles in the event of a total loss.
With knowledge and understanding comes acceptance of F&I. Training the sales team on F&I products, features and customer benefits, as well as the value to the dealership as a whole, will allow them to familiarize customers with your products and ensure a smoother transition to the F&I manager.
Extend to Service Drive
Educating the service department on the value of F&I products also will have a big payoff for your dealership. Understanding F&I helps the team better serve their customers, creating a better customer experience and higher retention.
According to the National Automobile Dealers Assn., regular service customers are 17 times more likely to buy their next vehicle from their servicing dealership. Almost all products sold in F&I are geared toward increasing service-drive retention. The language in most VSCs and maintenance contracts highly recommend customers bring their vehicles back to the selling dealership.
A knowledgeable service advisor easily can explain the benefits of a VSC or maintenance plan to a customer at a time when it has the most impact – when the customer is faced with the actual cost of vehicle repairs. This can be motivating and easily convert service customers to sales and F&I customers.
Imagine if every service advisor had the knowledge and ability to convert service customers to sales and F&I customers. Considering how many customers that service advisor sees in a day, or a week, the opportunity to drive customer retention and satisfaction increases substantially.
The only way F&I becomes a culture is by training your entire team on the value of F&I products. They can’t pass along what they don’t know, and they won’t pass along what they don’t believe in.
By educating everyone throughout the entire dealership you will see many far reaching benefits, including higher customer satisfaction and CSI scores, higher service drive retention, and higher sales retention. If everyone believes it and embraces it, ultimately F&I will become a way of life for dealership operations – and your profitability is the payoff.
John Stephens is senior vice president of Dealer Services at EFG Companies. He can be reached at 972-445-8910 and [email protected].