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Making the Most of Time in the F&I Office


The average time consumers spend on purchasing a new vehicle is almost four hours from start to finish – and most customers agree this is way too long. Once the customer has chosen a vehicle and negotiated the sale, they proceed to the F&I office. There, the F&I manager has numerous products to present, and a growing number of forms and disclosures to deal with due to increasing state and federal regulations. Without unnecessarily adding to the total transaction time, F&I managers must go through all the steps from securing financing and presenting products to the signing of paperwork in a very limited amount of time. We spoke to top trainers and agents and asked them how to achieve customer satisfaction while facilitating an efficient and productive transaction.

The Bigger Picture

Tony Dupaquier, director of training for American Financial’s F&I University, says in most cases the problem with the transaction being too lengthy starts well before the business manager is ever involved. He estimates that 80% of the time, required information is left out of the deal when it arrives in the business office. He says the front end – not the back end – is the biggest contributing factor to an excessively lengthy transaction. “The issue is not the time it takes for the F&I manager to complete the transaction, it’s all that leads up to that,” says Dupaquier, “The F&I manager has to spend a lot of time running around getting information and correcting things that are wrong on the paperwork before they can even start their product presentation.” He says this still happens around 20% of the time with some of the best, most well trained sales managers.

Ron Reahard, president, Reahard & Associates, Inc., agrees. He believes the issue is not the time a customer spends in the finance office; it’s the time they spend waiting to get in the finance office that creates customer dissatisfaction. “The other issue is whether or not the customer feels the F&I process is adding value or aggravation to their purchase experience. If the customer feels the F&I person is genuinely trying to help them, they don’t care how long it takes. If the customer feels the F&I person is merely trying to sell them products they don’t want and don’t think they need, ten minutes is too long.”

So what kind of information is it that the business office has to spend time waiting for, looking for, or correcting? An example would be information that was either not obtained or was recorded incorrectly by the sales department, such as copying a customer’s address from their drivers license and failing to ask if they still reside at that address. In this situation, when the customer arrives in the business office, the F&I manager has to reprint and correct all forms that contain the customer’s address – wasting time that could be spent on far more valuable tasks. Other items that are often missing are the new and trade-in vehicles’ mileage, payoff amount, and the loan holder’s information. “So much time in the F&I office is spent correcting inaccuracies coming from the sales department! And it is a problem nationwide,” says Dupaquier.

In addition, if a customer simply has not been made aware of the required paperwork that they must provide – such as title, registration and proof of insurance – having to obtain it when they arrive in the F&I office adds significant time to the deal.

Putting the customer in the right car from the start – one that fits with the amount they wish to pay monthly – can also save an hour or two of what Dupaquier feels is often unnecessary negotiation. “Say the customer says they want to spend $400 dollars a month but the sales department puts them in a car that will cost $550 dollars. Then they begin negotiating the deal and it takes an hour and a half to do this. It drives me crazy!”

At a one-price dealership, with fully transparent pricing, the transaction time is significantly less than at a traditional dealership where price negotiating is the norm. According to Dupaquier, at a one-price dealership, the entire transaction could be done in the amount of time it takes to print out the paperwork!

Planning and Managing the Time Spent in F&I

Before the customer arrives in the F&I office, Steve Pearl, president, The Oak Group, says there are a number of time-saving maneuvers that the business manager can and should engage in. “The deal should be input to the computer for one thing. Another is the F&I manager needs to have a conversation with the salesperson and sales manager about how the transition was structured. The customer needs to be briefed ahead of time on what forms they need to provide, such as title and registration. Finally, the F&I manager needs to ensure the car is being prepared for delivery.”

Bill Kelly, partner/owner, Automotive Development Group (ADG), added that ideally, though it is not always possible, the F&I manager should be prepared with a structured, approved deal and a complete menu. “Title paperwork and other forms that don’t affect the numbers can be pre-printed prior to the customer arriving in F&I, so that the time spent in the office is used most efficiently.”

“It’s not secret agent spy stuff we are doing in the F&I office,” says Reahard, “The customer needs to ‘see’ what that F&I manager is doing – that he or she is preparing their paperwork as quickly as possible. The F&I manager needs to have time to discover the customer’s needs by asking questions as the paperwork is being prepared.” Reahard says the F&I process has to be totally transparent. “The F&I process should be viewed by the customer as expediting the delivery process, not prolonging it, and this requires F&I professionals to have the ability to multitask.”

The actual appearance of the F&I manager’s office is not something to be overlooked pointed out Gerry Gould, director of training, United Development Systems, Inc. (UDS). “Many F&I managers don’t get their office ready for business and it is in disarray when the customer enters it.” A clean, comfortable office environment sets the tone for a smooth, relaxed conversation with the customer. A chaotic office does not lend itself to making customers feel at ease.

Pearl believes that 45 minutes should be the typical time a customer spends in the F&I office. However if the customer has already been held up for a significant amount of time prior to arriving in F&I, he says it is the responsibility of the F&I manager to complete the transaction more quickly.

Menu Presentations

Presenting products using a menu offers numerous advantages. According to Pearl, Menu selling is a must – and not the old fashion paper menu. “With all the quality menus on the market, it not only makes the sale less confrontational but it also increases the speed.”

Kelly points out that the menu is just a tool; proper use of the menu is what makes it work. During their menu presentation, Kelly says the F&I manager should review the deal structure and then present up to eight products.

Kelly says that ADG has developed a two-step method to present up to eight products and deliver a complete menu presentation in five to seven minutes. If a customer has concerns or objections, he trains F&I managers to address those concerns in an additional five to ten minutes. Based on customer surveys, Kelly reports that some manufacturers are guiding dealers towards a 50-minute total transaction – this is from the moment the customer says “yes” to the sales person until the moment they leave the F&I office. However, once a transaction reaches F&I, he thinks the transaction can be completed in even less time. This includes all the necessary steps from credit approval, menu presentation and product sales to the completion of paperwork.

Reahard also believes that the proper use of a menu is key to a well given, succinct presentation. “A menu allows an F&I manager to present multiple products in a brief amount of time, and makes it easier for a customer to buy more products. The fact is, in the F&I office you can only sell two or three products before the customer has had enough, but a customer can buy six or seven products if they’re in a package on a menu. That’s why the manufacturers offer option packages, and McDonald’s has value meals.  Grouping products into a package makes it easier for a customer to see the value of buying a package.”

John Braganini, principal, Great Lakes Companies, says trying to present too many products to a customer can take up too much time if not done properly. Ideally, he says four to seven products should be presented using a personal, pre-printed menu.

Keeping the F&I presentation to 45 minutes or less is what Gould recommends as a best practice. He describes step-by-step how to deliver a presentation in just more than a half hour: “First, review each DMS screen in front of the customer. It should take no more than three to five-minutes to verify and gather information from the customer. Printing paperwork should take no more than eight to ten-minutes. A product disclosure/menu presentation should be no more than three minutes. This should be precise and to the point – no selling or lengthy descriptions. Handling customers concerns over purchasing products should be less than ten minutes. Finally, signing the paperwork should take no more than eight minutes.”

Gould emphasizes the importance of delivering a feature presentation without including the benefits statements. He says an initial focus on selling, rather that telling adds unnecessarily to the time spent in F&I and wears the customer out. Developing a presentation that presents each column of the menu as one complete option narrows the customer’s choices and allows the presentation to be done more swiftly. “Each product should be described in no more than two or three sentences and the description should only point out what the product does. For example, to describe a tire and wheel product, you would tell the customer, ‘Tire and wheel coverage pays to replace or repair tires damaged by a road hazard for the next five years. A road hazard is anything that’s not supposed to be in the road.’” A simple, yet concise explanation of coverage works best.

Advice from the Experts

The most often repeated advice Braganini gives to F&I managers is: “personalize everything and project confidence.” He emphasizes good presentation skills, having a prepared menu and loading the deal in the DMS before the customer’s arrival. By doing all of these things, you will be ready for an effective conversation with the customer.

There are several sayings that Pearl has used many times through the years.

  • “No one has the right to say no for a customer. Be sure the customer is presented all the products available.”
  • “If a customer says no the answer should be ‘ok’. This totally diffuses the customer’s barriers. You can then circle back at a later point.”

And this leads to his last piece of advice…

  • “Conversation not confrontation.” Be able to discuss the pros and cons rationally and logically without putting it in the customer’s face.

Gould says rather than waiting on a customer to be dropped off in the F&I office, F&I managers should be proactive. “Get off your axle and meet the customer in the showroom!” Then, when giving the presentation, he advises F&I managers to “tell” initially and “sell” once you have the customer’s attention.

Take it from the pros – incorporate these tips and time saving tricks, and you will find a great starting point for improving efficiency, and streamlining transactions. The result? Satisfied customers and profitability in the F&I office.

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United Development Systems Named 2014 Dealers’ Choice Diamond Award Winner


CLEARWATER, Fla. – United Development Systems, Inc. (UDS) has been named the 2014 Dealers’ Choice Diamond Award Winner for F&I Training as awarded by Auto Dealer Monthly.

For the tenth consecutive year UDS has been ranked in the F&I Training category, while placing 1st in nine out of ten years surveyed. “Ten short years ago, in the inaugural Dealers’ Choice Awards, we were fortunate to have been named the Diamond Award winner as the top F&I Training Company in the nation. To now be honored with our 10th consecutive award is extremely gratifying,” says Randy Crisorio, UDS President and CEO. “While consistent and quality F&I Training has always been the cornerstone of our F&I Performance operation, I never sought, or expected, this type of national recognition. It is the dedication and commitment of the UDS Team that deserves all of the credit and our clients who value so highly our efforts that we give thanks and appreciation. Without each, this simply is not possible,” adds Crisorio.

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AAGI Announces F&I Certification Courses for 2014


Schaumburg, Ill. – American Auto Guardian Inc. (AAGI) announced its 2014 quarterly course schedule. AAGI sold out the four courses held in 2013; new for 2014, the company announced the addition of two advanced courses being developed. The advanced course would last two days and build upon techniques introduced in the first level session.

AAGI’s Performance Services department, through its partnership with United Development Systems Inc. (UDS), will host quarterly first level courses, each lasting five days. The program will include a focus on presentation skills and techniques, lender relations and advanced management skills. Additionally, participants will engage in role playing and critiquing of their performance by UDS staff.

Jeff Teuscher, vice president of sales and head of AAGI’s Performance Services, said, “When we introduced the training program in 2012, we had no idea what the industry’s response might be. With each session being ‘sold out’ in both 2012 and 2013, we realize the necessity of providing such an invaluable tool to our agents and dealers. Gerry Gould of UDS is a remarkable presenter, giving attendees the knowledge and confidence to achieve higher levels of productivity in their career.”

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Top F&I Trainer to Address Process, Hard-to-Get-Done Deals


Las Vegas — Gerry Gould, director of training for United Development Systems (UDS), will return to the 2013 F&I Conference this September to deliver “Raiders of the Lost Profit,” a workshop in which he will reveal areas of lost profit and the steps F&I teams need to take to capture that profit.

Scheduled for 2 p.m. on Tuesday, Sept. 17, Gould will show attendees how to construct a proactive F&I process that gets F&I teams involved in deals early and often. The session will look beyond standard finance deals, and will offer insights on how F&I teams can make a positive impact on cash and lease deals, as well as sales that originate online. He will also offer advice on driving a better connection between the F&I office and service.

“Gerry is a dynamic presenter and one of the top F&I minds in our industry,” said Gregory Arroyo, show chair and editorial director for F&I and Showroom magazine. “If you’ve heard him speak or read his articles, you know he’s big on getting F&I managers out from behind their desk and into the action. And with leasing and Internet sales testing tried-and-true F&I processes, that’s exactly what’s needed. So we asked him to help our attendees devise a plan for capturing the full F&I profit potential of all deals.

Last year, attendees of the annual conference voted Gould a “Best in Class” speaker, an honor he shared with F&I trainers Tony Dupaquier, Luis Garcia and Ron Reahard. Gould spent 15 years of his 33-year industry career in retail and became an F&I trainer in 1996.

The F&I Conference is one of three shows being hosted at Industry Summit 2013, which is being held at the Paris Las Vegas hotel Sept. 16-18. For more information, visit www.industrysummit.com.

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As Leasing Grows, So Does F&I Opportunity


In a report released this past summer, Experian Automotive noted that new vehicle leasing had risen by 12.5 percent this year to date – it hit a record high since the firm started keeping track of the statistic in 2006. According to the report, leasing now accounts for as much as 27.5 percent of new vehicle financing in the first quarter of 2013, up from 24.4 percent in the same quarter in 2012.

At the same time, the report noted that lease payments were down – at an average of $459, down from $462 in 2012. That comes with longer loan terms for lease deals – 65 months in the first quarter of this year.

For dealers and agents, these numbers represent an opportunity. While there have always been successful exceptions, the majority of dealerships tend to focus their F&I efforts on finance deals, with leasing customers getting little-to-no attention. But these numbers demonstrate that lease customers are a large and growing segment of the population, and contrary to popularly held beliefs, F&I products are as relevant to them as to the finance customer.

“Leasing has certainly grown and continues to grow every month,” said Brian Crisorio, vice president, United Development Systems (UDS). “Some stores are going from one a month to 12 or more; in some stores leasing is just huge. Sure there are a couple of makes or models not as focused on leasing, but it seems like across the board everyone is in the leasing game.”

What products should dealers be focused on? The consensus was that many F&I products have a place in a lease deal. John Vecchioni, national sales director, United Car Care, noted that any wear and tear product is a good fit for a lease, as is any interior/exterior protection plan, key replacement or tire and wheel. He also noted, surprisingly, that GAP is a potential lease product as well.

Tony Dupaquier, director of F&I training, American Financial and Automotive Services, also put GAP at the top of his list. “Not all leases have GAP,” he noted, “that’s one of the things everyone keeps forgetting. You have to pay attention and make sure the lease has GAP in it, and if not, sell GAP. Most leases do have GAP in them, it’s built into the lease, but you sporadically find leases that do not come with GAP, and the business managers don’t even know it. They have to make sure GAP is included, and if not, sell GAP.”

Wear and tear or appearance protection plans – both interior, with chemical protection, and exterior with dent and ding – and tire and wheel, were the top ancillary products all three agreed that F&I managers need to be presenting to every lease customer.

“Any appearance product is typically a good one for the lease customer,” noted Crisorio. “Protecting the exterior finish as well as the interior from rips, tears and burns keeps the vehicle looking great. Paintless dent repair does much of the same thing – if it’s turned in with dents and dings, they get a bill. Keys are getting more expensive every year, so key replacement is becoming more important – a damaged or missing key when you turn in the car will be expensive. And tire and wheel is also a big one.”

Vecchioni noted that he sees more products being sold into leases as a bundle, rather than individually. “Bundling saves time, and that savings allows you to capitalize on features and benefits of the products along with the impact it brings that particular customer. Wear and tear protection along with an appearance package go together. You can bundle almost any product, just keep in mind they have to have some similar advantages that make sense.”

“A case could be made that there’s an advantage to selling a multi product versus selling individual products,” said Crisorio. “A lot of it depends on the approach of the F&I manager – train on the process regardless of the deal. Focus on options, rather than individual products, and give them the best protection for that customer.”

Dupaquier noted that he teaches his F&I managers to always start off with the lease products in a bundle. “If customer doesn’t want a package for whatever reason, they’ll typically go back and pick up an individual item,” he said, “so start with all of them packaged together. The most successful F&I departments I’m seeing, they’ll put together a lease package that will have all of them.”

The exceptions to the bundling rule seem to be two: prepaid maintenance and key replacement. All three agreed that those are great lease products, but are easier to sell as stand-alone products. It is harder, they noted, to build value for maintenance or key replacement. Dupaquier noted that in many cases, customers argue that they’ve never lost a key, so they don’t see the value in key replacement, and he sees prepaid maintenance as more of a customer retention tool than anything else. The trick on that, at least, is to price it effectively.

“A lot of business managers go with scheduled maintenance as their number one hit,” Dupaquier noted. “The only cautionary piece is your price point on it – on a lease, the product price is divided by the term of the lease, unlike a traditional finance deal, which is divided by 72+ months in some cases. So scheduled maintenance that is $400-$500 changes the lease price by such an amount of money it turns people off. When a dealership tries to make too much money on it, the customer goes away, since they can go get the services done cheaper elsewhere. And on the lease, the likelihood is that the customer is coming back to that dealership anyway because of the lease, so you have built in customer retention. So dealers should put the focus on the ancillary products, for the items customers are responsible for.”

At the end of the day, selling products into a lease deal should be no different than selling them into a financed deal. Other than specific objections that might come up, the approach should be exactly the same.

“The training for handling a lease customer is similar to training for a traditional finance deal or cash deal,” said Crisorio. “Much of our training is process related, and doesn’t change if the product does. Only some of the word tracks might change to fit that customer. The approach is identical. The important part is to build value in the products you’re presenting.”

“I would explain the conditions of the lease,” Dupaquier noted, “as part of the way they start off conversation. Make sure the customer is aware of their requirements as far as vehicle condition is concerned – the same type of disclosure as how many miles the vehicle can have. Things like windshield has to be 100 percent; any door dings they’re responsible for; no mismatched tires –they have to make sure they have four of the same; any paint fading or interior staining they’re responsible for, etc. So educate them on that, then it’s easy to generate demand for the product. Don’t approach it any different; work it similar to a finance deal, with the same basic approach.”

Vecchioni summed it up with a few tips for agents to bring back to their dealers. “1. Present every product to your customers; wear and tear products, appearance products, key replacement, and tire and wheel protection are products that make sense. 2. Ensure every regulation is complied with, going over every lease agreement and the customer’s obligation to the lease – it helps set up product.”

At the end of the day, all the forecasts show leasing as increasing in the near future, with more customers seeing it as a solid financial alternative to financing, especially with so many people taking credit hits in the last few years. Agents should be stressing the importance of those lease customers to their dealers, as it is a trend that isn’t going away any time soon, and it’s a profit opportunity that shouldn’t be missed. “Agents should embrace leasing as additional opportunities that earn money,” said Crisorio. “They have to support the dealer, and support the trends in the industry. There is nothing an agent can do to stop it, so embrace it, support it, and be a true partner to your dealer and help them in any way you can.”

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Menu Discipline is Key


At Agent Summit earlier this year, Gerry Gould, director of training for United Development Services, presented a panel on menus, and menu discipline. And to kick it off, he shared a compelling fact: 85 percent of F&I managers don’t use menus effectively. They don’t present every product to every customer, and they don’t have a consistent process in place.

That is something he wants to see changed.

“People who don’t buy into the menu concept just don’t have a good process,” Gould said. “There needs to be a consistent process every time. The presentation matters more than the size of the menu or the products presented.” He went on to stress that every customer should be presented with every product they qualify for, every single time. The menu itself, he contends, needs to be a disclosure of all the products available to the customer, not a hard sales tool.

The process actually starts long before the F&I manager gets to the menu. It should begin with the sales consultant on the floor. That person needs to set up F&I as a partner in the process, and an ally, and they should personally introduce the clients to the F&I manager, and hand them off with a reassurance that while they’re doing that, the sales person is still going to be working for them as well, getting the vehicle ready. Finally, the sales person can help to set up the expectations, asking about how long this will take. The F&I manager can then answer the question, and smoothly take over the appointment.

The menu itself should be prepared with all the proper terms, and with all of the products that customer qualifies for. The presentation should never take more than three minutes, Gould noted. The F&I manager should point out the features of each product — not the benefits — and should follow the “ABCs”: Always ask to proceed, Break down all the options, and finally Close on the options.

He advocates that F&I managers understand that the features are the story they need to be telling — those are what the product actually does. The benefits are the sale — that is what the product actually does for the client, specifically. And trying to “stair step” sell will just lead to fatigue, long before they ever get a chance to present every product. This is where the menu, and grouping similar products, when done well, allow them to present every product without making the customer feel fatigued and frustrated.

Some ways to reinforce that, Gould noted, are with certain catch phrases. These include “May I…?” sayings, such as “May I proceed?” or “May I share with you?” Other phrases can include ‘By choosing…”, “These are your payment options…” or “What that means is…” the F&I manager can control the pace of the presentation, come across as polite and helpful, and not seem like it’s a hard sale that will immediately get a customer defensive.

At the end of the day, a solid process that presents all the products, combined with a polite, helpful presentation designed not to overwhelm clients, will lead to more sales, and happier customers. “Self discipline is the final key ingredient,” said Gould. “You are the only one standing in the way of your own success.” If F&I managers can learn to use the menu effectively, they will get out of their own way, and everyone in the process will benefit.

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