Why F&I Underperforms – The Assumptions You Make - "Everyone Knows That We Finance"

By Myril Shaw, Dealer Profit Services

Last week we started a series about the profit delivery potential of F&I in every store.  It should be delivery 3.5% profit on unit sales.  It should be delivering 7.5% profit on the amount financed.

Dealers make a series of assumptions that serve to inhibit F&I success.

This week we look at the first of those assumptions – "Everyone knows that we offer financing."

Well, sorry, no they don't know that.

People buying boats and RVs don't bring the same set of assumptions that they bring to buying cars.  When someone is thinking about buying a car, they just know that car buying is a "one-stop-shop" experience.  They expect to finance the car where they buy it.

Lifestyle purchasers do not bring that same assumption along.  They frequently decide to shop financing, or figure out how to pay for their new purchase before you even see them.

Yet, we know that 80% of the "cash" buyers are not paying with "liquid" cash.  They found financing elsewhere, they used a home equity line, they sold stocks or bonds, but they did not have the money in their check or savings account and they liquidated assets or taken on debt – why did they do that through you?

THEY DID NOT KNOW THAT THEY COULD!  THEY WERE TAKEN BY SURPRISE WHEN THEY FOUND OUT ABOUT YOUR FINANCE CAPABILITY – AND THEY WERE EITHER COMMITTED OR EMBARRASSED.

From the very first point of contact, you have to be advertising, you need to be screaming from the rafters that you have Competitive Financing Available.  Outside your store, you need road visible signs and banners that say "Competitive Financing Available."

Your advertising – print, radio, TV, web, social media, direct mail, etc. – all need to announce your financing capability.

Your website needs to have finance banners all over it.  You need to be using "soft-pull" credit technology to allow someone to "Get Pre-Qualified" on your site.  Every piece of inventory on your site needs to have a "Get Pre-Qualified" button associated.

When someone walks into your store, they need to see signs and banners inside that talk about your Competitive Financing.

When you are advertising inventory, you NEVER want to show a price, you always want to show a payment.

Financing available and payment is what every one of your customers sees and hears from the first time they dream about their lifestyle purchase.

Finally, once they do come in and they meet their salesperson, before they even start shopping, they need to be introduced to their "Delivery Coordinator/Business Manager/ Finance Manager" with the message from the salesperson that, "Once you have fallen in love, Bob here will go over the delivery details and logistics with you."  In this way, you have ensured that you get one final bite of the F&I apple and even if they can't be convinced to finance, you now have a quality opportunity to sell optional protective products.

Don't fall into the assumption trap.  Be loud about and proud of your F&I capability and drive up your F&I profit!

Dealer Profit Services, LLC can help.  Whether you want someone to take over your F&I and just drive profit to your store, help you some of the time, need some quick advice or just provide F&I Training/Consulting, we are here to help you.  Contact us anytime at info@dealerprofit.com or give us a call at (470) 326-0966.