Both the sales manager and F&I manager play critical roles at any car dealership. If you’re looking for ways to climb the ranks in your sales career, you may be considering which path to take. This guide covers the duties and responsibilities for each position so that you can decide which one is right for you.
What Does a Sales Manager Do?
The sales manager has the most influence on the sale of vehicles off the dealer’s lot. When sales representatives are struggling to close a deal, it’s the sales manager that steps in and has the authority to offer discounts and services that would sweeten the deal. Sales managers hire, train and manage sales staff and set their schedules to ensure that there is floor coverage when it’s needed the most.
A sales manager also prices the vehicles in inventory, determining the most attractive prices while providing the most return on investment possible for the dealer. To be a sales manager, you need to have very strong sales and organizational skills. Sales managers do a lot behind the scenes that customers and sales representatives may not realize or appreciate.
The following skills are needed to be an effective sales manager:
Ability to Relate to People
Sales managers need to have empathy toward other people so they can determine the best way to help customers. The purchase of a car is a major decision for most people and often requires taking on a car payment that lasts for years into the future. Customers can be stressed over their purchases and whether it’s the right time for them to close the deal.
Sales managers need to be understanding and relatable so that customers feel their concerns are valid. This creates trust. People are much more likely to make major purchases when they trust someone.
Strong Negotiation Skills
Sales managers are constantly challenged to find the middle ground between what benefits the dealership and what makes the customer happy. Because sales managers need to know how to close sales with the most difficult customers, they need excellent negotiation skills. They need to show customers the value they’re about to receive from their purchase and be able to know when to give ground.
Verbal and Written Communication Skills
Sales managers need to be able to get their point across clearly when interacting with sales representatives, other department managers and customers. They need to be able to produce documents without errors, listen to the concerns of customers and motivate sales representatives to achieve their goals.
Sales managers are behind the events and sales that draw customers into the dealership. They need the ability to manage an advertising budget effectively and deliver a return on marketing investments. Customers have many dealerships to choose from when shopping for a car and it’s the role of the sales manager to make his dealership stand out in the crowd.
What Does an F&I Manager Do?
The role of an F&I manager begins after a sale is already closed. F&I stands for finance and insurance. The focus of an F&I manager is to work with banks to secure loans for customers and then to provide insurance products such as warranties to add value to the deal. Some would argue that the F&I manager is the most important person in the building, because all sales reach their desk before the customer leaves in a new car.
The following skills are needed to be an effective F&I manager:
Strong Communication Skills
The F&I manager is often behind the scenes negotiating with lenders to determine the monthly payment a sales representative or sales manager brings to the customer. What seems as simple as delivering a number is much more complicated than you realize. Dealerships work with many lenders and the finance department needs to find a financing option that fits in the affordable range for the customer.
F&I managers need strong written and verbal communication skills to be able to negotiate with banks and then explain the terms of a loan to the customer. This begins with running a credit check and then submitting the correct forms to financial institutions to get approval offers. Some creditors might have special terms behind their offers, so the F&I manager needs to communicate those terms clearly.
Strong Sales Skills
Many customers reach the finance department after a stressful negotiation over the price or payment for a vehicle. The F&I manager then tries to add warranties and service packages to the deal. This can be a delicate situation that requires excellent sales skills to manage because any product you add to the deal also adds to the payment.
Time Management Skills
F&I managers often work on multiple deals simultaneously. Sales representatives are bringing in potential deals and details about the customers’ desires. The F&I manager needs excellent organizational skills and has to be able to manage their time effectively. No one likes to wait in line for the finance office to free up and it’s stressful for sales representatives and customers who want to complete their business and move on.
Training in Finance Operations
While there’s no formal educational requirement to become an F&I manager, many dealerships would prefer that their F&I managers have some degree of training in finance. The dealership may send someone to a training seminar or workshop to develop the needed skills to perform the job or could provide on-the-job training. It’s most ideal for F&I managers to receive both forms of training and to attend seminars regularly afterward to continuously learn and improve their skills.
Which Position Pays More?
It can be difficult to determine for sure what you can expect to make as a sales manager or F&I manager. Income varies depending on where you live and how well you perform your job. On average, a car sales manager can make around $134,625 per year. F&I managers are in greater demand, resulting in greater pay increases over the last five years.
Compared with five years ago, the average pay for sales managers has risen 5.4% while F&I managers make 7% more now than five years ago. Today, they make more than $142,000 per year on average. Both careers are lucrative enough to consider pursuing and what’s right for you depends on your skillset and what you feel most comfortable doing.
Learn More About Sales and F&I Training at the Automotive Dealership Institute
Whether you’re pursuing a role as a sales manager or finance and insurance manager, the Automotive Dealership Institute can help. Our programs last four weeks and provide you with all the skills you need to succeed in your desired role. Call 877-592-6313 to learn more.