At 7:00 a.m. in a perfect world, there wouldn't be a criminal coming to a dealership for vehicle service, wandering the showroom while waiting for his car, and deciding to take a credit application and several copies of drivers' licenses that were left on a salesperson's desk the night before.
Unfortunately, this major safeguards rule violation and others can happen at any time at any dealership unless there's an enforced process of adhering to finance and insurance compliance laws.
Some dealerships use the threat of termination to force employees to comply. This approach is effective on the surface, but doesn't truly make the employee care about protecting the dealership.
Unintentional mistakes can happen during hectic days. For example:
- A salesperson leaves the permission-to-drive slip in the car after a customer's demo drive.
- A sales manager pulls the credit of a “phoned-in” co-signer.
- With several deals waiting, an F&I manager has a customer sign a blank menu “in the interest of time.”.
But in a government investigation, offering busy-day excuse for such mistakes is like hiding behind a skinny lamppost to avoid machine-gun fire.
The way to bulletproof your dealership and potentially save millions of dollars in lawsuit payouts is to comply with every rule, regulation, policy and procedure.
This is attainable if all dealership personnel are committed to creating and maintaining a culture of compliance. This starts with building habits.
The first step is to totally secure all personal and private information in the finance or sales office with locked doors and file boxes. Identify who will control that information and designate them in your information security plan.
Every employee should be aware of the designated managers, and sign an acknowledgement.
Maintain a protected central location for copies of driver's licenses, deals in the works or any information the sales staff will need to access on a daily basis. Set up a procedure that defines the use of this information. Impress upon the staff that this is the system. Their daily routine will conform accordingly.
Stored deals from previous years and dead deals need to be in locked file cabinets at all times, with only the people designated in your information security plan having access. Sales people will soon realize that only an authorized manager can look up an old deal.
Teamwork is important to a culture of compliance. Make sure every employee hears you say “we” are protected because of these procedures. And stress this: “We're a team in every aspect of this dealership, including doing things right.”
That fosters sales people's respect and reinforces their desire to help keep the dealership compliant. The goal is compliance as a natural way of doing business.
Take personal responsibility if you catch a violation. Sit down with the offender and say, “We messed up, I'm counting on you to not let this happen to us again.”
Explain that to protect “our dealership” is why, for example, the employee must fill out a permission-to-drive slip for a dealer plate. Say: “Don't let the customer leave it in the car next time; it compromises their personal information.”
A culture of compliance helps all dealership policies and procedures. Because of gained respect for the F&I department, sales managers will enforce 100% turnover to F&I, knowing customers' personal information is secure. In turn, the F&I department will help the sales department hold more front end gross.
Good habits developed in compliance will pass over to all areas of operation, such as menu selling. The F&I manager will give a properly presented menu with all optional products fully explained and disclosed for every delivery every time, no matter how busy the day gets.
In a culture of compliance, the F&I manager will happily get used to making more money and enjoying higher customer satisfaction scores.
Robert Linkonis Sr. is F&I manager at Pearson Infiniti in Richmond, VA. He can be reached at [email protected]
