What is Finance and Insurance
The F&I Department is one of the main sources of profit of the dealership. As such, the Finance Department is both one of the most dynamic and most important areas of any dealership.
It is charged with three primary tasks: completing all the legal paperwork involved in the purchase of a vehicle, arranging credit for customers who need it, and then helping those customers protect their investments by presenting them with option packages.
Most F&I Departments offer services far beyond credit and insurance. They also offer vehicle protection contracts and aftermarket products designed to protect the customer’s investment, such as alarm systems and products that protect vehicle finish and interior fabric. The Finance Department’s services focus attention on the benefits of financial arrangements and protection for both customers and their new vehicles.The purpose of the Finance Department is to serve the financial and security needs of customers and to expedite the purchase process while generating a reasonable return to the dealership. Finance managers act as advisers, helping customers consider the advantages and disadvantages of alternatives that are available to them.The F&I Department is also crucial to the dealership’s ability to retain customers. It has been proven that people who take advantage of F&I services and products are more likely to return to that dealership. If the customer chooses to pursue financing through a source other than the dealership’s Finance Department, they are likely to second-guess opinions of the dealership personnel, and will be unlikely to return.If the customer has a good experience in the Finance Office, there is a good chance he will return to the dealership for future purchases, and tell his family and friends about it. Conversely, a negative experience in the F&I Department can be detrimental to the dealership, and hurt its future prospects.
First and foremost, ADI is an F&I School dedicated to the education of talented individuals interested in embarking upon or advancing their careers in automotive dealerships, lending institutions and related fields.
Graduates of our F&I School are trained to present to customers all products normally offered in dealership F&I offices, including extended service contracts, anti-theft devices, GAP protection and loan programs for prime and non-prime credit consumers. They are also trained on products designed to protect the resale value of the vehicle, including safeguard paint, fabrics and interiors.
ADI’s F&I training is designed to teach the skills necessary to become a successful automotive Finance Manager, Internet Sales Manager, dealer representative for aftermarket manufacturers or banks, or loan officer for financial institutions. Our F&I training covers the entire retail auto sales process, enabling those with no previous automotive experience to gain the professional insight necessary to thrive in the industry.
As part of their F&I training, students spend supervised lab time working with authentic automotive F&I software. Advent Resources F&I Software allows students immediate access to information needed to manage and maximize their earning potential. Advent is designed to work deals the way the cars sold, so it is very easy to use and provides great customization.
ADI’s F&I training is organized into four modules, covering a wide range of industry-specific subjects, including:
Dealership operational and management structure, including each step of the sales process and objection handling. During this module, students will utilize Advent F&I software to perform leasing calculations and create a leasing deal. Students will learn leasing guid
elines and terminology relating to automotive leasing, including payment structure.
Prime Finance and Insurance. This module provides the F&I training necessary to give students a working knowledge of proper financial practices and procedures as it relates to customers with prime credit. Students will also learn the proper procedures for taking accurate credit applications, obtaining and merging multiple credit reports.
Nonprime Finance and Insurance. This module is designed to teach students methodologies and techniques for serving customers with nonprime credit, including those who have had bankruptcies, charge-offs, foreclosures, judgments, repossessions and other credit blemishes.
F&I Menu Presentation / Objection Handling. The final stage of the program instructs students in the presentation of all products that are offered in dealership Finance Departments. This includes extended service contracts, anti-theft devices, GAP protection and loan programs. The F&I training culminates in the student’s videotaped menu presentation.
If you selected a career in the automotive industry, congratulations – you couldn’t have made a better choice. The latest F&I news indicates that this is an excellent time to be entering the car business. The Automotive Dealership Institute is the culmination of decades of practical experience and training expertise in the expanding field of automotive Finance and Insurance Management.
According to one of the leaders in F&I news – the National Automobile Dealers Association (NADA) – more than 1 million people are employed in nearly 21,800 dealerships nationwide, contributing to an annual payroll of more than $48 billion. More than 705 million vehicles have been sold in the United States since Henry Ford’s first Model T. The cost of those vehicles? More than $6.7 trillion.
The Automotive Dealership Institute’s curriculum has been carefully crafted to include all aspe
cts of F&I Management, from automotive, motorsports and recreational vehicle dealership operations to deal structuring, lender relations and Internet sales and management. We believe there is no finer course of study for this particular subject anywhere in the world. If you’re keeping up with current events in F&I news, you’ll see that our curriculum incorporates the latest industry developments.You’ll start by learning how a dealership works, from its various sales systems to the terminology that has become a language unto its own. You’ll also see how developments in the latest F&I news impacts dealership operations. For those who have never worked at a dealership, you’ll learn how to sell a car, from the meet and greet and test drive to negotiating terms of the agreement and delivering the vehicle. You’ll learn about the Finance Office, and the various functions of a professional F&I Manager. You’ll receive expert training on Advent Resources F&I software, an indispensable tool that is among the nation’s fastest-growing dealership programs. You’ll create both retail and lease deals, just like they do at a real car dealership, and you’ll become an expert on such automotive aftermarket products as extended service contracts, maintenance agreements and vehicle security systems.And that’s just in the first week!The education you receive at the Automo
tive Dealership Institute will give you the tools you need to succeed. By the time you’re ready to graduate, you will have become a virtual fountain of automotive F&I news and knowledge.
Service Advisor Training
Students who complete the Service Advisor Training course are trained on the service process, the advisor’s responsibilities, building customer rapport and creating value. They are also trained to improve performance, handle telephone procedure/objectives and overcome objections. They learn the customer interviewing process, fact finding, effective ways of documenting service, delivery and follow-up.
Introduction and General Description of What Is a Service Advisor. Identifying the Advisor’s Responsibilities. Understanding the Bureau of Automotive Repair and Writing a Repair Order. Telephone Procedures and Objectives. Customer Interview Procedures. The Value of Building Rapport and Providing Solutions.Module 2
The Sales Process. Steps and Definitions of a Sale Cycle. Steps to the After Sale Process. Overcoming Objections. Learning to Fact Find and Isolate the Objective. Realizing Value and Profit. Customer Satisfaction.
The F&I Manager performs a number of vital functions, including reviewing and confirming the agreed-upon sales figures, preparing salespeople to confer with customers about needed services or products, consulting with customers to determine their wants and needs and presenting products to fulfill them, obtaining credit approval, and preparing delivery documentation. Throughout the process, the Finance Manager must practice strict legal compliance and ethical behavior.
The following is an overview of the finance manager’s job functions:The F&I Manager works in concert with the dealer principal and/or general manager to determine which lenders and suppliers of finance products will best be able to meet the criteria set by the Finance Department.Most of the F&I Manager’s job requires interaction with the customer. After establishing a rapport with the customer, the finance manager reviews the customer’s credit application and credit report and discusses the available finance options to meet their needs. Once the financial arrangements have been finalized, the Finance Manager prepares the delivery documentation, including the preparation of the loan documents, DMV paperwork and other legal forms required by state and federal regulatory bodies.The F&I Manager also utilizes a menu to present available product options to the customer, counseling them based on what was cultivated during the initial customer interview. This efficient and effective process also builds strong CSI, as customers appreciate knowing about the wide range of protection products available to them, such as credit insurance, extended warranties, anti-theft devices and appearance protection kits. At this point, the Finance Manager is responsible for disclosing to the customer all aspects of the sale, including finance charges and interest rates.
The Finance Manager must maintain a high Customer Satisfaction Index (CSI) with the dealership’s customers, as required by automobile manufacturers. The F&I Manager often leaves a lasting impression on the customer, as he or she is the last person of authority that customers normally see when purchasing a vehicle.
Special Finance Manager
Special Finance Managers, and the Special Finance Department as a whole, have become a vital component in the automotive dealership. Availability of a varied buyer base plays an extremely important role in success of growth of today’s dealerships. Following are some of the benefits of thinking outside of the box and closing more deals with a Special Finance Manager.
- Ability to offer different options to customers to secure present and future business.
- Ability to creatively structure a loan package around the customer’s needs and their credit.
- Availability of an expanded market; more customers means more profit/income.
- Lower denial ratio; more approvals means more profit/income.
- Opportunity to build relationships with customers, which builds loyalty that translates into more referrals; more deals means more profit/income.
The “Automotive Service Advisor” of today is a person who works in a service department as a contact person between customers and other staff members in the dealership. The ability to work independently in a busy, pressure-filled environment is required. Customer focus, relationship maintenance and communication skills are of paramount importance in this position.
The Service Advisor is responsible for meeting and greeting the customer, documenting any and all of the customer concerns, selling needed service and repairs, handling factory and extended warranties, arranging alternative transportation for the customer, providing estimates, keeping the customer informed as to the progress of repairs and explaining the finalized repair order to
The Service Advisor translates the customer’s concerns and the actual reality of a repair problem into the standard language of a repair order. They also present the value of dealership service, and sell additional services to customers.The Service Advisor is ensures a solid customer base by encouraging repeat and referral business. The Service Advisor provides that important link between the customer and the service technician and they can make the difference between a satisfied customer and a frustrated one.
The Service Writer has one of the most hectic, and most important, jobs in an automotive dealership. They are the dealership’s point-of-contact employees, the link between the dealership and the customer.
Since the Service Writer is often the first person that a customer meets when they are bringing their vehicle in for repairs or service, it is imperative that they be perceived as professionals that can satisfy the customers’ needs.
The customer’s image of the dealership as a whole is primarily based on their interaction with the Service Writer. This means that they can make a big impact in sales revenues very quickly. Service Writer promises the customer a fair price, an accurate time of completion, complete satisfaction – and they have to make a profit at the same time.Remember: in business, image is everything. Your customers will make assumptions about you based on your image. These assumptions will, in turn, influence the way the customer responds to you during the business transaction.Service customers today have high expectations. They can be demanding. They are aware of quality issues. They are cost conscious. They are willing to express themselves if their expectations have not been met. If we don’t meet or beat their expectations, we give that opportunity to someone else who will be able to satisfy our customers’ wants and needs.Today, providing quality service simply isn’t a choice, it’s a necessity for any dealership that wishing to remain economically viable. Service Writer must, therefore, be educated about balancing the needs of the dealership with the needs of the customers.
Demand for managers in powersports F&I is increasing exponentially. As gas prices rise and income falls, more and more customers are looking for a less expensive alternative to traditional vehicles. The huge profitability offered by the powersports industry has prompted an evolution in powersports F&I. Many of the same principles found in automotive F&I offices are now being applied to their counterparts in the powersports industry.
There are two basic types of Service Departments.
- Product specific service facilities.
- System specific service facilities.
The most common type of product specific service facilities are new car dealership’s Service Departments. These Service Departments must be completely educated about all of the models being serviced including those that may be more than a few years old. Although they specialize in the type of new vehicles that they are franchised to sell, they usually are capable of servicing other makes also.Some service facilities repair or specialize in one system such as transmissions or performing tune-ups. These facilities are referred to as system specific service facilities. These specialty shops are usually limited to a few types of repairs. The Service Department and technicians must have an in-depth knowledge of the systems being repaired.Years ago, new cars made money for the dealer. Today, as a rule of thumb, they don’t. After factoring in overhead expenses, floor plan interest, advertising, competition, etc., most dealers make very little on new cars. This is part of the reason that the dealers are looking to their Service Department to recoup that lost income.As with many industries, product is no longer the profit point. Instead, the product – the vehicle – is sold so that the dealer can make money in the Service Department. As auto manufacturers find it harder to distinguish themselves by characteristics such as products or pricing, customer service has become the last critical competitive advantage.