F&I Training Center
Free Finance Manager Training
ADI’s F&I Training Center is your source for free basic finance manager training material to help you improve and develop your F&I skills. Be sure to check back often for new material from ADI.

In addition to these resources, take your F&I knowledge and skills to the next level by enrolling in our hands-on F&I Training program taught at our state-of-the-art campus in Scottsdale, Arizona or our online training program!

F&I Integration With Sales

A Finance Department cannot operate alone. To fully realize its income potential, the Finance Department must have an outstanding working relationship with every other department within the dealership. This is accomplished by fostering a professional work environment among all dealership management and support personnel. This, in turn, helps generate sales.  While this cooperation is required dealership-wide, nowhere is it more vital than between the Sales and Finance Departments. In fact, how successfully a dealership’s Sales and Finance Departments internally relate to one another largely determines whether or not the dealership itself will succeed.

 

Interdepartmental Communication

 

Attending sales meetings shows the salespeople that the finance manager is a team player and is open to questions and discussions. This is also a great opportunity to train the salespeople on very crucial matters, such as the proper introduction to finance, how to promote F&I products on the sales floor, and the benefits of all the available services. If they understand what happens in the Finance office and the benefits of the services, they will be more inclined to influence the customer in a positive way toward finance.

 

Management meetings give the dealer a chance to review successes and failures with each department and solve problems. It is important for the finance manager to attend management meetings because it gives the finance manager an opportunity to learn the operations of the other departments and to understand their problems and accomplishments. This perspective often leads to better communication.

 

Ultimately, this cooperation between the Finance and Sales Departments can translate into success for the entire store. When member of Sales and Finance lead by example, their practice of respectful, consistent interaction helps the dealership craft the right “game plan” for the entire dealership.  After all, they’re all players on the same team.

 

To learn more about the relationship between the F&I and sales departments and how they help each other succeed, check out these articles:

 

F&I Training and Techniques: Rebuttal for “I Don’t See The Value”

In this video, you’ll see an ADI graduate demonstrate how to correctly and appropriately respond to a customer’s concern that they “don’t see the value” in certain aspects of a deal.

To learn more about the F&I Training program at ADI, get in touch with our helpful advisers today!

F&I Training and Techniques: Using the Reverse Sale

In this video, an ADI student demonstrates how to use the “reverse sales” technique when educating a customer on the benefits they would receive by purchasing an extended service contract.

To learn more about the F&I Training program at ADI, get in touch with our helpful advisers today!

F&I Training and Techniques: Rebuttal for “I Can’t Afford It”

In this video, an ADI student demonstrates how to respond to a customer that says “I can’t afford it”, and explain how what you’re offering makes sense for them financially.

To learn more about the F&I Training program at ADI, get in touch with our helpful advisers today!

Path to Prosperity: Understanding Today’s Credit-Challenged Market

The automotive industry is changing.  Profit margins are narrowing as the marketplace becomes increasingly competitive – and complex.  Dealers are trying to find new ways to to sell more cars, minimize costs, develop additional profit centers and offer finance options that will meet consumer demands today and in the coming years.

 

Change is a precursor of advancement and growth. That’s particularly true in the automobile industry, which is evolving at a tremendous pace. The integration of new technologies are improving dealership’s cash flow and, ultimately, the bottom line.

 

For the consumer, choices are growing as well – not only in the myriad of products that have flooded the market – but in financing options, and the companies that offer them.

These choices have been trickling down to the nonprime market in a major way again. Want proof? Just see how many credit offers come flooding to those who have just had a bankruptcy discharged – and sometimes even before the discharge.

 

Dealers are aware of the new consumer trends, and have taken action by becoming more accommodating and flexible to their customer base. For the dealer, this is a time when even a slight competitive edge can mean significant profits.  In an effort to gain such an edge, dealers have embraced the opportunity to serve the non-prime market. Dealers have recognized that appealing to this still growing segment of the population offers huge dividends, both financially and philosophically.

 

An issue dealerships must face is an increasingly large percentage of consumers are currently in an economic position to finance a vehicle, but may have suffered credit setbacks for one reason or another. These customers are often excellent car-buying candidates, but remain haunted by their financial past.

 

It would be in the dealers’ best interests to capture this growing market, for a variety of reasons. Dealers who find a better way to capitalize on this opportunity – changing their procedures to address their customers’ needs – will not only remain ahead of their competition, they will pave the way for improved customer rights.

 

A successful approach to the credit-challenged customer can pay off in many ways:

 

  • Converting a massive consumer market into profitability.
  • Increasing responsiveness to a disparate customer base.
  • Protecting consumer investments through additional product sales.
  • Building dealership loyalty through repeat and referral business.

 

Dealers know that excellent credit gives the consumer a negotiating advantage. The balance of power shifts when dealing with a credit-challenged customer. But should still be kept in mind that customers credit options may be limited, but their choice of dealerships is not.

 

Any dealership which can address the customers’ needs respectfully and accommodate their wants will breed intense customer loyalty. These customers will tell their inner circles how the dealership was able to help them when no other store would. And, they’ll want to come back themselves when they are in a better position to upgrade their vehicles.

 

Best of all, As long as deals are structured properly, stipulations are collected and the paperwork process is in order, dealerships can prosper beyond prime.

Part II: Working with the Sales Team

Salespeople are very important to the dealership in general and the finance department in particular. Nothing happens in a dealership until a vehicle is sold. The salesperson has the first opportunity to influence the position of the customer toward the Finance office and all the F&I products.

 

Salespeople must have confidence in their finance managers to support them in securing the vehicle sale. They must believe that the No. 1 priority of the finance manager is to protect the front-end gross profit. The finance manager can obtain the trust and support of the salespeople in a number of ways.

 

  • Educating salespeople on how dealer-controlled financing can secure the sale and protect the front-end gross.

 

  • Making time for salespeople to consult on progress of the deals and pending approvals.

 

  • Being efficient with all paperwork. This shows salespeople that they have a competent finance manager, their vehicles will be delivered and they will get paid.

 

  • Preparing the vouchers and incentives accurately and timely for salespeople.

 

  • Participating in sales meetings.

 

  • Working as a TEAM with the sales force.

 

This cooperative behavior must continue once the finance manager has taken custody of the customer.  Just as inappropriate comments from the salesperson can sabotage the finance manager, the finance manager can easily undermine the salesperson’s rapport with the customer.   This may not only panic the customer, who may try to withdraw from the sale, it also jeopardizes any repeat or referral business this customer may have generated. With a few simple guidelines in place, though, this derailment can be easily avoided.

 

To maximize performance and alleviate mishandling of a deal, the finance manager should:

 

  • Separate the car sale from the vehicle financing.

 

  • Avoid commenting on or trying to close the car sale.

 

Avoid creating a negative attitude with the customer about the Sales Department or the salesperson.

 

Be sure to join us next week for in-depth insight on understanding today’s credit-challenged market.

Part I: Working in Sync with the Sales Department

The Sales Department sells the vehicle and secures the front-end gross. The Finance Department completes the legal paperwork to deliver the vehicle and secures the backend profit. In order to maximize the total profit both departments must work together on every deal.

 

The two biggest problems that cause most Finance Departments to lose income are:

 

  1. The failure to properly familiarize the customer with a dealership’s financial services and F&I products.
  2. The manner in which a customer is introduced to the finance manager by the salesperson.

 

The contributing factors for these problems will, of course, vary from dealership to dealership, but the dealership that best handles them comes closest to maximizing its profit opportunities.

 

Sales management should make it a standard policy that all customers, regardless of their intentions of financing, must be given the opportunity to be professionally exposed to the dealership’s financial services and F&I products.

 

The proper introduction of the customer from the Sales to the Finance is critical to ensure a successful transaction. An improper comment from a salesperson can leave the finance manager to discuss his services in an unfavorable environment.

 

Successful Transition

 

Transitions, whether in life or in business, set the stage for what’s to come. In many cases, a smooth transition can lay the foundation for success from one phase of a process to another.

 

The same is true in automotive sales. The transition of the customer from the salesperson to the finance manager is critical to ensure a successful transaction. Without a proper introduction at the appropriate time, the customer will be ill-prepared for the final, and arguably, most important aspect of the sales process.  The best strategy is a well-practiced, seamless sales process.  Customers must never sense they are working with two separate departments.

 

There are two traditionally accepted methods of turning over the customer to the F&I manager. One system calls for the salesperson to escort the customer to the Finance Department, while the other entails the Finance Manager meeting the customer on the showroom floor or at the salesperson’s desk. The key is consistency. Whichever policy is in place should be followed with each and every customer to ensure a winning game plan. The Sales Department and the Finance Department must always keep in mind that they are playing for the same team. In order to win, the transition needs to be handled flawlessly.

 

The proper time for the introduction is at the point of sale. A premature introduction could scare off the prospective car buyer; if they’re not yet committed to the new investment, how can they consider the additional products and services designed to protect that investment? Conversely, if the introduction occurs too late, say at the time of delivery, the customer probably has already made arrangements for financing and other insurance needs.

 

Seamless Transition

 

There are purely psychological barriers that could inhibit a smooth transition. Salespeople are protective of “their” customer, and are aware that the sale they worked so hard to achieve could conceivably fall apart in the Finance Office. Consequently, their reluctance to introduce their customers to a third party that was not directly involved in the vehicle’s sale is understandable.

 

F&I Managers can counter this reticence by maintaining open lines of communication. Combat the fear of the unknown – the sequestered transaction between the F&I Manager and the customer – by sharing that information with the appropriate salesperson. That information, however, should not include the customer’s financial particulars. That is a privacy issue that must be protected at all times.  The F&I Department can further strengthen its relationship with the Sales Department by keeping it up to date on all deals. When word on a particular deal comes in, whether it’s positive or negative, it should be passed along. Processing all deals quickly and efficiently is also conducive to healthy inter-departmental interaction.

 

The salesperson, in turn, can prep his or her customers for the F&I experience.  If the customer has knowledge of the process, he can mentally prepare for it. That means he won’t be surprised, or upset, when he is asked to spend another 30 minutes at the dealership in the Finance Office after he already has spent hours making his deal.

 

Educating the Sales staff on the importance of the F&I Department and the value of its products can serve a dual purpose: it can help salespeople sell more vehicles, and can pave the way for increased backend profits. Today’s increasingly competitive marketplace means that few dealerships make any profit in the vehicle contract anymore.  With incentives and sales down, profits must be made elsewhere.  The selling of products and services has become a necessity.  The bottom line is that cooperation between the two departments is essential, so that the left hand knows exactly what the right hand is doing.

 

Be sure to stay tuned for Part II: Working with the Sales Team!

F&I Integration with Sales: Intro

This post is an introduction to a 2 part series.

 

A Finance Department cannot operate alone. To fully realize its income potential, the Finance Department must have an outstanding working relationship with every other department within the dealership. This is accomplished by fostering a professional work environment among all dealership management and support personnel. This, in turn, helps generate sales.  While this cooperation is required dealership-wide, nowhere is it more vital than between the Sales and Finance Departments. In fact, how successfully a dealership’s Sales and Finance Departments internally relate to one another largely determines whether or not the dealership itself will succeed.

 

Interdepartmental Communication

 

Attending sales meetings shows the salespeople that the finance manager is a team player and is open to questions and discussions. This is also a great opportunity to train the salespeople on very crucial matters, such as the proper introduction to finance, how to promote F&I products on the sales floor, and the benefits of all the available services. If they understand what happens in the Finance office and the benefits of the services, they will be more inclined to influence the customer in a positive way toward finance.

 

Management meetings give the dealer a chance to review successes and failures with each department and solve problems. It is important for the finance manager to attend management meetings because it gives the finance manager an opportunity to learn the operations of the other departments and to understand their problems and accomplishments. This perspective often leads to better communication.

 

Ultimately, this cooperation between the Finance and Sales Departments can translate into success for the entire store. When member of Sales and Finance lead by example, their practice of respectful, consistent interaction helps the dealership craft the right “game plan” for the entire dealership.  After all, they’re all players on the same team.

 

Be sure to stay tuned for Part I: Working in Sync with the Sales Department!