THREE WAYS TO FIX F&I APATHY ON YOUR SHOWROOM

by Tony Troussov, CSP™

When dealerships are struggling with F&I production, there are plenty of blame to pass around. From training to payplans, from process to personnel, there are multitude of reasons performance can be lacking. If everything seems to be in place, you may want to assess your showroom’s culture. In many cases it is the disconnect between sales and finance departments that causes inconsistent or poor F&I performance. What makes things difficult is, when you are very close, this disconnect can be hard to detect. If left unchecked, however, it will lead to a showroom where sales teams are not engaged with your F&I process and have developed apathy toward your F&I department. If your showroom floor is suffering from the F&I apathy, here are three ways your team can create the F&I friendly culture that brings value to F&I

1. Team environment starts with you. First of all let’s establish that F&I is a team sport. The proactive support of a sales team will turn an average F&I manager into a top producer. On the flip side apathetic sales team can torpedo top producer’s efforts and turn them into an average one. Most importantly, team environment is a two way street. Too many F&I managers either forgot it or never knew about it. The “bow down and kiss my ring” mentality will not take you far and most likely destroy your efforts. Let’s face it, the most important thing for your sales team is to sell cars. They don’t really care about you selling a single product – “just sign them out”. Your confrontational approach will definitely make it worse. Start with what is important to them. When you begin helping your team to sell more cars, take great care of their customers regardless of pay method, and treat everyone with respect, your sales team will reward you back. The old saying proves it “you get more with honey”. Team sport means you have to give first and sometimes expect nothing in return. Go ahead, and take first steps that will lead you to helping them sell more cars. It will pay huge dividends.

2. Educate your staff. No one likes to look stupid in front of a customer. If you don’t know or understand something you will simply avoid talking about it. The same goes to your sales people. They will not endorse something they do not know much about or do not understand. When was the last time you took time to train F&I product knowledge with your sales people? How well do they understand your product offering? Most sales people are familiar with service contracts and they understand Gap. Majority, though, have little to no knowledge about your ancillary offering. For instance, do they understand a T&W or Combo product you offer? In other words, can they talk about its value to their customers? Can they speak intelligently about benefits and function of those products? To create value in F&I, show them the value their customers receive when they take advantage of protection products your dealership has to offer. Once they learn about what is available, take time to train them on how to plant seeds for F&I products during their sales process to prepare customers towards your presentation.

3. Gamify incentives. If you have F&I incentives for your sales team, ask yourself – “how long have they been around?” Do they motivate your sale force? In many cases incentives are stale and not visible to sale people. No one is tracking them and they magically appear on their paychecks hidden with the rest of incentives. This form of “out of sight out of mind” makes it difficult for their behavior to stick. You may or may not be able to redesign your incentives, but, you don’t have to change much to gamify your current incentive program and create a fun competitive environment to engage your sales team. From football game points to casino chips, from rolling the dice to “Mario Cart Racing” there are plenty of ideas to create a game-type atmosphere and let your team win. Turn your stale incentive plan into exciting game and watch their participation increase and apathy disappear. Keep track of their scores and use various rewards methods to motivate their performance.

Creating the F&I-friendly culture does not have to be difficult or frustrating. Realize this, fixing the F&I apathy at your dealership has to start with your F&I team. To change sales team’s behaviors you first must win their hearts and their minds. Do so, by helping them sell more cars first, educate them on your total offering, and finally gamify your current F&I incentives to eliminate the F&I apathy from your showroom once and for all.

WHAT IS YOUR F&I TEAM OBSESSED ABOUT?

by Tony Troussov, CSP™

When you hear about someone being obsessed about something, at first you may perceive it as a negative thing. Here is a definition of the word obsession – it “is an idea or thought that continually preoccupies or intrudes on a person’s mind”. Of course obsession could be bad, but if you have good thoughts preoccupying your mind or dominating your mind continuously they can turn into a very positive drive and focus. Let’s face it – it is hard to stay focused in the automotive business. Many of us are simply not wired that way and constantly chasing the proverbial “squirrel”. But healthy obsession that generates laser-like focus will create consistency of healthy results. So what should you and your F&I team be obsesses about? In order to reach greatness in F&I here are four areas that your team needs to be obsessed about daily.

Number one – training and education. In my travels I meet plenty of F&I professionals who are self-taught and who have never attended a formal F&I training. It is sad, but lack of education is a reality in our industry. Whether it is a three day, or a two-week long F&I boot camp, offsite training and learning is vital, regardless how long your people have been in F&I position. Being open to learning and growth is important, what’s even more important is to be obsessed about getting better. Practicing, drilling and rehearsing their skills will get your team to the level beyond their current one. Obsessed teams are practicing with each other during down time and not during busy times with their customers. In addition to that, they are obsessed about success of an entire store, so they educate and coach their sales team, both on products and process. Let’s get obsessed about self-improvement and growth in F&I.

Number two – forecasting and tracking. You know it – what’s gets measured – gets done. If your team is not setting goals and forecasting their year, quarter, month or a week, there will be nothing to track their progress against. Many good teams know what their PVR and penetrations should be, they may even know what their total gross profit should be for any given month, great teams are obsessed about forecasting and tracking their progress. They can tell you exactly what they are trucking on any given day. They strategize and plan their year and then work it backwards down to each week. An obsessed team knows the numbers they are tracking each day of the month and if they are down from their forecast, what will it take to catch up. This enables them to be consistent month-in and month-out. Obsession about forecasting and tracking will keep your team accountable to each other.

Number three – communication and culture. Lack of communication is the root of many problems within many organizations. Your F&I department affects every department within your store. Inconsistent or unclear communication leads to confusion and dissatisfaction of your employees and customers. Clear and consistent communication from F&I department will generate plenty of good-will from everyone involve. Both verbal and written communication is important. Telling someone who did a great job during a sales meeting will go long ways. Communicating via email at the end of a day about daily progress with a management team will create awareness and culture of accountability. Being humble and asking for help when needed will improve a culture of openness. The prima-donna status on the other hand, will isolate them and contribute to a bad culture. Being obsessed about communication will lead to a culture that will create a great working environment.

Number four – performance and profit. This seems obvious – F&I is all about profit and performance. What makes F&I team great is their obsession about each and every deal. They are working on performing their best on each transaction, be it cash, lease or finance. I never forget hearing one performance-obsessed team told me this – “we do not have lease, cash or finance deals – we just have deals”. To uninitiated being obsessed about profit, can be perceived as bad. In reality dealership’s profitability should be every employee obsession. A healthy obsession with profit is not about greed it is about growth and pride. This obsession will lead your team to think through each deal before they jump into it. It will lead them to reflection on every lost opportunity and obsession to do better next time.

Being obsessed about aforementioned areas does not mean you cannot have fun and enjoy a great team environment. On the contrary, it simply means staying focused and preoccupied with things that will generate great opportunities for everyone. With that in mind, ask yourself, what is your team obsessed about? What things preoccupy or intrude on their minds? Help them focus and re-align their thinking to be obsessed about education, communication, culture and performance all of these and many more healthy obsessions will lead to greater profitability.

THREE THINGS YOUR F&I TEAM MUST OWN.

By Tony Troussov, CSP™

In his book “Extreme Ownership” ex-Navy Seal Officer Jocko Willink talks about leaders putting their egos aside and taking responsibility for their own actions and the actions of their teams. It is a great read for any leader or those who aspires to be one. What does the extreme ownership means to your F&I department? There are three areas of ownership that your team can focus on to accelerate their performance to the next level, whatever that level might be.

OWN YOUR PROCESS. First and foremost your team must own their process. Any process is defined by habits and attitudes, good or bad ones. The opposite is true as well, a great process will shape their habits and attitudes. Take a hard look at your F&I process to identify its pitfalls and areas of opportunities. What can be refined? For any new process to stick it is important to have your team’s buy-in. This is also includes sales people and sales managers. When you make your team part of process development, they will be able to bring ideas on how to improve things, which will increase chances of a new process becoming their own. What outcome does your team want to have? Who will be executing certain parts of this process? What are the time considerations to execute each step? Walk through it on paper as a team. Introduce findings, make adjustments if needed and then get everyone’s commitment to execute it consistently. Efficient and effective F&I process will increase productivity and improve customer experience, this in return will increase profitability and customer satisfaction. When your team owns this process they will keep each other accountable to insure its successful execution. F&I is a team sport – when a manager complains about sales people not following steps of a process, he must look in a mirror. Take ownership of everyone’s actions on your team.

OWN YOUR COMMUNICATION. The lack of communication is one of the major roots for inconsistent customer experience and employee dissatisfaction. Everyone gets along better with better communication. Lack of feedback to employees breed poor attitudes and bad habits. Lack of interaction with a customer, leads to bad perceptions and increased sales resentment from them. In our fast paced environment – urgency is the key. Never delay that important call back they expect from you. Customers expect answers fast and keeping them informed and updated throughout their buying experience is fundamental part of a successful F&I department. Consistent communication generates trust and creates a comfort level that will provide goodwill and much needed attention-reciprocity from your clients in the F&I office. Stop the blame game – no one wants to hear it. When someone on your team failed to communicate with a customer, take ownership of it. Follow-through is critical – you must own your communication.

OWN YOUR RESULTS. “Your success is your own fault” – this is what the Pitbull of Personal Development, Larry Winget said. Whatever level of success your department might have, guess what, you know there is more to be had. Recently I met with one of my F&I teams in a high volume store, who finished the month with a 56% VSC penetration. As we were talking about a new month, I challenged them to see what they are missing to get to the next level. They took ownership of a challenge and focused on every opportunity. They worked harder to keep each other accountable, strategized, conducted extra training sessions and one-on-ones with sales people. Few weeks later they were at 74%. It is easy to get comfortable and complacent with good results. Own your results no matter if they are good, bad or indifferent and seek for more.

You do not have to be a Dealer Principal or a GM to put ego aside and take responsibility for the actions of your team. When everyone on your team takes ownership of their process, communication and results your entire will perform at a greater level and generate more income.

CREATING AN EMPLOYEE PIPELINE FOR YOUR F&I DEPARTMENT

By Tony Troussov, CSP™

It is not uncommon to hear Dealer Principals or General Managers lament about F&I coverage at their stores.  All too often, someone is taking a vacation, called-in sick, or un-expectantly quits.  Turnover has tormented our industry for as long as it’s been around.  F&I is one of the highest paid positions in a dealership and also one of the most critical to dealership’s operations, so turnover could be costly.  In addition to tough schedules and job demands, the showrooms are still filled with F&I “mercenaries” who are chasing a highest payouts and ready to jump ship.  Meanwhile, you still have to make sure your cash register is ringing and deals are being delivered.  A third party coverage option might be available, but being self-sufficient has its advantages.  Creating an employee pipeline for F&I department is not new.  There are several F&I providers who built their business around that, while fewer dealers actually done it.  Based on the dealer group case study, here are few steps ho to get there on your own.

START WITH THE END IN MIND.   Similar to any project, you want to begin with an outline of what it is you want to accomplish.  In this case, you want to create an employee development program for F&I Manager position.  With this in mind, you can start working on it by asking yourself – what kind of an F&I Manager you want to have on your team?  In the case of the dealer group, that created an FDP – or Finance Development Program, they identified the “end-product” – a highly trained and loyal employee who is driven by career development.  To achieve this, they had to have a solid plan for hiring, onboarding/training and development.

HIRING.  This part is the most critical part of the program.  Getting the right person into your development program is the key.  Using the personality/behavioral testing the dealer group identified behavioral traits of individuals who excelled in F&I.  Utilizing the language that best reflects these behavioral traits, they created a recruitment ad for Manager Trainee position.  Their game plan is to hire individuals from outside of dealerships with no automotive experience.  College grads with ambitions and desire to grow are heavily recruited.  FDP candidates see the end game – being part of Management team and know upfront a step by step way to get there.  After passing behavioral testing and rigorous interviews candidates are hired and referred to as FDPs.

ONBOARDING AND TRAINING  Part of FDP’s onboarding is learning how to sell cars.  This is both a need to understand the business and a testing period.  Management team agrees on FDPs sales performance expectations.  If you ever sat in F&I chair and perform at the highest level, you probably can look back and see what it took for you to get there.  Break it down and see what components of this job one has learn first and what cadence of learning would work best?  One thing is for sure FDPs have to learn how to sell cars.  There are multiple skills an FDP candidate has to learn, starting with administrative like paperwork and product knowledge.  Then comes menu presentation, selling intangibles and overcoming objections.  Later lender skills.  What happens most of the time with new F&I Managers they are simply being thrown into their position and like most job in automotive its sink or swim.  Even with best intentions, most senior F&I folks do not have much time for coaching.  This is why this group designed a self-guided study course.  While selling cars FDP candidates are learning F&I skills.

DEVELOPMENT.  During self-guided studyFDPs are periodically tested after passing certain milestones and completing portions of their guides.  Management staff monitors progress and with this structured process FDPs are progressing at their own speed.  While the program is designed to be completed within six months, some are able to complete this development portion within three months.  Depending on the needs of a dealership upon graduation, FDPs get promoted into F&I Assistant Manager or move to another location within the  group. 

Utilizing Finance Development Program, this dealer group was able to lower turnover in F&I and create a leadership pipeline, with many of the first year graduates working throughout the group in various management positions.  Today, they are using this template to create employee development program for service and other critical positions within the group. 

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