Opinion: Focus on F&I Basics in 2023

A picture of Greg Artman of Diversified Insurance Management

As the 2023 selling season arrives, some expected hurdles lie ahead. Since 1910, the RV industry has persevered through ebbs and flows. As history shows, RV dealers tend to rise to the occasion by staying focused on the basics throughout the store.

The past two years, dealerships often found securing inventory difficult, so customers would buy whatever RV was available or close to their desires. In a post-Covid market, that will change. Consumers now will have a pick of inventory, as well as a choice of the dealership to do business with because of inventory availability. This is the year to buckle down and stick to the basics.

The entire sales department must avoid taking shortcuts, focus on consumers’ needs and create relationships. Those relationships will lead customers through an established buying process.

The industry’s ebbs and flows fueled changes the past two years, making the F&I sales process even more important. Business managers must receive 100% of customer deals at the point of the sale. The dealer principal and managers must ensure this happens with every consumer transaction.

Staff should treat each deal as if it were their last. They should take no shortcuts nor make assumptions. Salespeople do not get to decide who sees the business manager. This includes transactions closed over the phone, in which credit card information is collected.

The business manager should collect down payments on every contract and meet and greet every customer. They cannot skip the F&I basics; they must be followed with no shortcuts. Salespeople must understand the business office is part of the sales department. The handover to the business office at point of sale is a step in the sales process.

Let’s review the business office’s four responsibilities.

Deliver the RV—The business manager’s No. 1 priority is to deliver the RV, regardless of back-end profits.

Cover the dealer’s assets—Make sure the paperwork is complete and correct, creating a cashable contract with all money collected. Use checklists and double-check each deal’s paperwork.

Customer Satisfaction Index—Earn the customer’s business by delivering a professional and positive experience. Doing so will satisfy the customer and create repeat business.

Make money—The reason for making money is last. If you complete the first three tasks, you should make money. That is what a proper F&I process does.

We have outlined the sales department’s basic responsibilities to the business office and outlined the four primary business office responsibilities. Let’s consider some of the F&I sales process’ most critical steps.

Start with a proper introduction and turnover to the business manager, which should happen at the salesperson’s desk each time.

During the greeting, the business manager explains their responsibilities, gains permission to join the customer and salesperson and agrees to follow the F&I sales process.

The meet and greet begins by saying: “Congratulations on your purchase. My name is _______. My responsibilities include reviewing and completing your paperwork, handling your title work and assisting in any funding needs that you may have. May I join you?”

Then, start the interview with light relationship-building questions before transferring to the office.

Lead the customer to your office by saying: “Some of the information we need to discuss is private in nature. Let’s go to my office where it is more private.”

Once at the office, begin building a trusting relationship. If the customer likes you, they will listen to you. If they listen to you, they will trust you. If they trust you, they will buy from you.

Once they are listening and trust you, ask questions that plant a seed and create a need. Use effective questions with solutions in mind.

Having a structured deal enables an effective interview, where you ask questions to elicit helpful answers and establish trust. Other questions should build value while planting the seeds and creating a customer’s need for products and packages.

Some example questions include:

In the untimely event of a total loss, what provisions do you have to handle any deficiencies? If you have a total loss, whether from an accident or other catastrophe, do you have protection to cover the difference between the RV’s value and your payoff? We have a policy option for you to review in a bit.

Will you store the RV outside alongside your garage or inside where it is protected from the elements? We have a package available to keep your RV looking new for many years to come with a one-time application. We can look at that package to see if it is cost effective, fair enough?

Do you understand what the manufacturer’s 12-month limited warranty does and does not cover? We have programs that enhance the limited warranty during its 12 months but protect you further out. These options are much more affordable than paying for a repair later.

If the customer asks about the warranty and say they are pretty sure they do not need one, you can answer: “An unprotected option is your choice. Did you ever wonder why the manufacturer only covers a brand-new unit for the first 12 months? That is because the manufacturer fully understands the parts’ and components’ loss ratios and obsolescent cycle and passes that on to you, the consumer, rather than covering the RV and parts for longer terms. The choice is yours, but when you investigate these warranties deeper, you will see why most consumers have one.”

Next, present a menu listing all products. Be confident and start your presentation by including all products in the payment. Use your experience, knowledge and skills to overcome objections. Use the relationship you created. If you did a million-dollar presentation and the customer failed to see the value, do not push too hard and make the process a bad experience.

When the time comes for the customer to sign the paperwork, help them understand what they are signing. They should leave with the paperwork, rather than receiving it in the mail.

I will close with this. A few months ago, I was visiting with a long-term sales professional who has always been a top producer in his store the past 20 years. We always get together and discuss sales, overcoming objections and other things.

He is a student of the business and always has been. Our topic was properly asking the customer for the sale. After, we both agreed asking the customer for the sale has fallen off the radar the past couple of years. Asking for the sale is a salesperson’s most important task.

This season, customers will require you to work harder to earn their business. If you are going to do the work, ask that question. What do I need to do to earn your business?

Remember, you are in the people business! Have a great 2023 season.

Greg Artman has been with Diversified Insurance Management, a Higginbotham Company, since 2005 as a regional manager, national training manager, VP and managing director. His experience also includes 17 years in the auto, motorcycle, marine and RV dealerships in various positions from sales to GM. Artman spends most of his time coaching, training and consulting dealers. His experience helps to implement best practices in today’s market space.

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