The Road to ROI with F&I

Top 10 Dealership Laws and Regulations

As we have already discussed, the automotive retail industry faces a complex challenge of complying with the stringent legislation as set by state and federal governments. Many dealerships have often fallen short of expertise, time, and workforce to uphold the mandatory requirements.

In part two of our article, we break down the regulatory language and jargon to help you understand what the federal and state is required of you.

Most automotive managers are so pre-occupied with bottom-line results (driving profits) above all else. And that's fair enough since today's auto retail industry is more competitive than ever. Nevertheless, the cowboy car dealer days are well over. 

In the automotive industry, laws and regulations are always being updated and changed. It’s essential to keep up on the latest information and news and also be consistent with Deal Audits. Here are a few tips to consider when needing to keep your dealership compliant.

For dealerships to be successful, they must stay compliant with the latest state and federal regulations. By implementing an internal audit plan, you will employ the routine checks and balances your dealership needs for compliance.

Unfortunately, fraud does occur within automotive dealerships. By committing to a routine system of checks and balances, you will also strengthen your dealership against internal fraudulent activity. You will also feel confident that you are employing the best people and the best practices.

While there are no laws that require you have to hire a compliance officer, there's a chance that without a hyper-focus on compliance, you could wind up breaking actual laws as a result.

Let us explain.

American car dealerships face a huge variety of laws and regulations. While failing to follow some of them may lead to losing money and clients, breaking certain rules could result in bankruptcy and imprisonment.

Let's go over the most important regulations to follow to ensure dealership compliance and smooth work of your company.

Dealership compliance is a vital and necessary part of running your business correctly. Dealership compliance is the only way to avoid expensive lawsuits and maintain a good reputation. Customers remain loyal to a dealership with compliance training because following compliance laws helps to build trust. With laws changing continually and the introduction of new employees to the dealership, ensuring compliance is a difficult task. These tips can help you maintain compliance in your dealership at all times.

The complex and ever-changing rules of Finance and Insurance compliance may be frustrating to keep track of, but they exist for a very important reason. These rules keep dealerships from even accidentally taking advantage of customers. Without strict enforcement of F&I compliance, a single stray salesperson could ruin the fair business record of an entire dealership. While constant re-training is necessary for absolute compliance, you can prepare your team to always work in the spirit of F&I protections by training them in transparency and good-faith sales.

Most of us view paperwork as tedious and cumbersome to the process of doing our regular work, especially when it comes to F&I Compliance. And most of us probably sit in front of a pile of forms and documents and think, "What have I gotten myself into?" No one likes paperwork, so don't feel alone. The trick to tackling it is understanding where to start and having a mapped out battle plan. 

So, you have to start by getting your team to view things through the eyes of an accountant (paperwork heaven...made you shudder huh?); or we can train your team to establish a consistent means of dealing with and processing paperwork (that does sound better).