The Words That Make F&I Tremble, But Should Not – "I'm Paying Cash"

By Myril Shaw - Dealer Profit Services

"I'm paying cash."  Oh, there goes your opportunity for any finance profit right out the window – right?  WRONG!

Let's start with a little known and grossly under-appreciated statistic – 80% of "cash" buyers are NOT paying with liquid cash.  They are tapping a home-equity line, selling some assets, or financing (from someone else.). Only 20% of "cash" buyers have the cash readily available in their checking or savings account.

So, what do you do?

First, as we discussed in an earlier post, do not assume that your buyers know that you are a one-stop-shop and do offer competitive and convenient financing.  The message needs to be in all your advertising, on your website, and on big signs in your store.  Add a "Get Prequalified – Does Not Affect Your Score" button to each piece of inventory.  Let people know from first contact your finance capabilities and keep reminding them throughout the purchase process.

Second, introduce your Business Manager/Delivery Coordinator at the start of the shopping process rather than at the end.  "Once we know which unit you have fallen in love with, Bob will go over all the details with you so that you can start enjoying your unit as quickly as possible."  In this way, no matter what the customer says about their purchase method, you have guaranteed yourself the opportunity to revisit self-proclaimed cash buyers at the point when they are most excited about closing the transaction.

Third, show payments, not prices and there must be two hard and fast sales floor rules: 1) No checks or cash are accepted on the show floor – only the Business Manager can do that; 2) Sales always focuses and points to prices.

Fourth, once your buyer has declared once again to the Business Manager that they are paying cash, the Business Manager will initiate this conversation, "It's terrific that you are able to do that.  You clearly must have great credit.  Wouldn't you at least like to explore your options, maybe you can have even more fun with that cash?"  This will generally only work in a small percentage of cases, especially if you are already following the three preceding points.  However, it is a guarantee that this will work in 0% of the cases if you don't try.

Finally, 100% of your buyers are presented with all appropriate optional protective products.  You will sell protective products to cash buyers – so your F&I profit is boosted, even if the customer is paying cash.

"I'm paying cash" is not a threat – it is a challenge – and one that you are good enough to overcome!

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.