May 2012 Edition:
Why should you adopt a pre-approval
Fueling false expectations by showing a credit-challenged customer
a vehicle that they will not qualify for simply leads to
cancellations. Many Business Managers secure a payment call through
a non-prime lender after a prime solution is declined on the
original vehicle that the customer wanted. Trying to switch this
customer to another vehicle that they don’t want after they have
built up such great expectations can lead to a customer walking
away from the dealership entirely. Compounding this situations is
getting the customer to accept a higher interest rate as well.
Wiser dealers adopt a pre-approval service that is offered early in
the sales process. Here is an example:
“Here at ABC Motors, we offer a pre-approval service which
allows customers to shop with less stress and more confidence
knowing what they qualify for based on their payment capacity and
down payment; it’s just like getting pre-approved for a mortgage.
There’s no charge and no obligation whatsoever. Would you like to
take advantage of this service while you’re here
This generally flushes out a potentially credit-challenged
customer. After qualifying their customer, a salesperson should
introduce this customer to a Business Manager who should proceed to
complete a credit application and then pull the customer’s credit
report. Using the report, show the customer why they don’t qualify
for a prime solution and show them how they can rebuild their
credit with a non-prime solution. Using the “Red Circle—Green
strategy (see March 2012’s newsletter) will help to
build a brighter vision of the future and will assist in gaining
the customer’s acceptance of another vehicle and a higher interest
rate. “You don’t have to love it, just drive it.”
'Desking' deals for improved F&I
Many Business Managers are asked to 'desk’
deals for their
dealerships when their sales managers are off duty or busy. Many
sales managers also want to see improved F&I profits and take a
pro-active F&I approach when 'desking' a deal where a
customer’s commitment level is high.
A high commitment customer is determined when a customer has said
to the question:
“If the numbers were agreeable for you Mrs. & Mr. Smith, could
we put a deal together today?”
In these scenarios, proposals can be structured to include one or
more after market protection plans as determined by the nature of
the payment plan or by the needs and wants of the customer. Here
are some examples:
▪ finance payments can be quoted with GAP
▪ lease payments with an excess wear & tear waiver
▪ any proposal can include a road hazard warranty, snow tires, an
extended warranty, other vehicle protection applications,
accessories or some level of payment protection whether it be
unemployment, disability, critical illness or life insurance.
Include an appropriate after market item on high commitment
customers and see how fast your F&I profits will improve.
Leverage social media and
testimonials to improve F&I profits:
The picture above was taken on Christmas day 2011. It is an
original 1996 Oldsmobile Cutlass that was treated with a complete
vehicle protection package. As you can see, the paint sealant and
rust protection worked fabulously.
Salespeople are video-taping their customers at delivery today
about their buying experiences and posting them on their
dealership’s website, Facebook, YouTube and their personal
websites. Leveraging social media by posting video testimonials of
your customers who have benefited from vehicle/loan/lease
protection plans is a 'no-brainer.'
Over 80% of consumers use the internet to investigate their next
vehicle purchase. Consider the impact of a customer testimonial
describing how they took advantage of a payment protection plan
that they registered and how it helped their family during a
difficult time. How about a service customer who just had a major
repair bill taken care of by an extended warranty plan they had
registered or a customer who just walked away from $2,900 in excess
wear & tear charges from their lease termination?
These customers are in your dealership and easily accessible. This
should be an initiative that you begin today that never ends. Ask
your service advisors and suppliers to ping you when a success
story occurs and you will have dozens of good new stories to tape
and load on the web.
Fun rebuttals to creditor insurance
▪ “If you get sick or hurt and unable to work, I could send you a
get-well card. If you register this coverage, I can include a
cheque in the card. Which would you prefer?”
▪ “ If it wasn’t required by law, would you still bring a life
jacket with you when boating?...That’s exactly what this coverage
will do for you. It’s better to have the coverage and not need it
than need it and not have it.”
▪ “If you had a horse that won the Kentucky Derby, would you insure
it? Your future ability to earn income is also worth protecting
with this coverage.”
How to convert more cash
If your dealership attracts a lot of cash buyers, then it’s likely
that your overall Business Office profits are not where you would
like them to be. There are some customers who will be using true
cash from their savings but that is likely a small percentage. The
majority will be using their lines of credit. There are several
initiatives that a dealership can take to increase its finance and
1—Plant a seed for the need to finance or lease a vehicle well
before your customers ever arrive to your dealership. Over 80% of
customers will research their next vehicle purchase on-line so that
is where you should be speaking to your customers. Most websites
inform customers who, what, where, when and why to buy their
products but not “HOW.”
Your website should have an
information pop-out or pages discussing the disadvantages of paying
cash, using a credit line to purchase a vehicle and the advantages
of leasing. Consider using a credible source to author the
2—Conduct a training workshop for your sales staff reviewing the
disadvantages of paying cash or using a credit line to purchase a
vehicle. If you secure your sales staff buy-in, they can have a
tremendous influence over their customers actions.
3—Conduct a training workshop on the advantages of leasing vs.
financing. Customers will lease a vehicle even if the payment is
higher than a purchase finance payment if they are aware of the
benefits. Don’t sell the rate or payment, sell the solution. Their
buy-in will once again boost lease penetration.
4—Create point of sale materials that can be displayed inside and
on the outside of your vehicles that promote financing/leasing.
Produce a showroom display board that provides customers with
information that will steer them towards choosing a payment plan
instead of using their cash or line of credit.
5—Lastly, learn how to confidently convert a cash buyer on a
turnover. Too many Business Managers use antiquated strategies that
simply don’t work. If you knew how to do this, you would already be
converting cash buyers. Invest in yourself and get some some fresh
training. Wye Management has a workshop specifically addressing
converting cash and line of credit customers to dealer plan
financing and turn-key solutions for securing buy-in from your
Implement and execute on these suggestions and watch your finance
or lease penetration levels soar.
and find out how.
01. screenr.com — record movies of your desktop and send them
straight to YouTube.
02. bounceapp.com — for capturing full length screenshots of web
03. goo.gl — shorten long URLs and convert URLs into QR codes.
04. untiny.me — find the original URLs that’s hiding behind a short
05. qClock — find the local time of a city using a Google Map.
06. copypastecharacter.com — copy special characters that aren’t on
07. postpost.com — a better search engine for twitter.
08. lovelycharts.com — create flowcharts, network diagrams,
09. iconfinder.com — the best place to find icons of all sizes.
10. office.com — download templates, clipart and images for your
11. followupthen.com — the easiest way to setup email
12. jotti.org — scan any suspicious file or email attachment for
13. wolframalpha.com — gets answers directly without searching —
see more wolfram tips.
14. printwhatyoulike.com — print web pages without the clutter.
15. joliprint.com — reformats news articles and blog content as a
16. ctrql.org — a search engine for RSS feeds.
17. e.ggtimer.com — a simple online timer for your daily needs.
18. coralcdn.org — if a site is down due to heavy traffic, try
accessing it through coral CDN.
19. random.org — pick random numbers, flip coins, and more.
20. pdfescape.com — lets you can quickly edit PDFs in the browser
21. viewer.zoho.com — Preview PDFs and Presentations directly in
22. tubemogul.com — simultaneously upload videos to YouTube and
other video sites.
23. dabbleboard.com — your virtual whiteboard.
24. scr.im — share you email address online without worrying about
25. spypig.com — now get read receipts for your email.
For a complete listing, visit: