Pushing out the bottom line of your F&I department can feel like the most difficult thing you've ever done, and a lot of dealership decision makers have more trouble with it than any other aspect of the business. But a little bit of advice can go a very long way, and we're hoping that we can offer just enough to give you that boost you need.
Finance and insurance (F&I) specialists are vital to the daily function within a dealership. Your F&I specialist has the flexibility to work with customers, lenders, and other staff members to maintain the quality relationships that keep your dealership running smoothly. With a thorough knowledge of all products and compliance laws, F&I specialists also help maintain the high ethical standards expected of your dealership.
There are a lot of problems you can run into when running a dealership, but one of the most prevalent is the constant struggle to increase your profit margins. There are a few key things that you should look out for when selecting an F&I Vendor.
Your F&I department is a key influencer on your Parts & Sales business. Every department at a vehicle dealership depends primarily on an unpredictable flow of new and returning customers to make revenue quotas, but the sale of an F&I department product is a predictable opportunity to generate additional Parts & Sales revenues.
Running a car dealership is one of the most challenging careers, because you never know whether a customer will go to a competitor in the blink of an eye. You have to know what your customers want ahead of time if you want them coming back after buying or leasing a car, or just thinking about it.
The chances for wear & tear in car leasing is greater than ever as more people depend on their vehicles for everything. Some of your leasing customers are perhaps business travelers or those who just want to travel for leisure. Even local drivers can end up experiencing wear on their cars faster than expected.
The customers you're long used to catering to in your car dealership business are beginning to change. Many of your upcoming customers are Millennials, the ones turning anywhere from 18 to 33 years old.
Running an auto dealership usually means trying to balance more than just selling cars. As you already know running a dealership, you have numerous departments that may need more business to bring a steady income. One major area where you can keep cash flow going is the parts and service department.
Finance & insurance are the cornerstone of a strong dealership. Only if you handle F&I properly can you maximize the sales available with each customer. But when dealing with such a variety of people day after day, it can be hard to decide what the best overall approach is.
One of the challenges you've likely had to deal with in your dealership's F&I department is finding ways to best organize your menu selling. With so many products available for a car buyer to choose from, it can overwhelm them if you present a long scroll of ways to protect their vehicle.