These articles recap some of the opportunities uncovered by Gart Sutton & Associates’ powersports specialists during consulting visits.
These are followed by recommended actions that address the issues. Our goal is to provide ideas to help improve your dealership.
This older, large, multi-line dealership is located in a southern town of 50,000 people. Because of its strong reputation, the dealership draws business from several rural towns and a city of 200,000, located almost 80 miles away. They had been a high-volume, low-profit operation for many years. As economic situations changed, they were forced to modify their business model or risk losing their dealership. Although still a bit light on margin, they have successfully changed to a more profit-oriented structure. They are still doing a volume of more than 2,500 units per year.
Gart Sutton & Associates’ consultants were called in to help them improve the store’s processes and profitability in every department. This series began by looking at the sales department. Last edition examined the state of the dealership’s F&I department. In that report, we covered the basic F&I training in product presentation and role-play activities. This resulted in a significant improvement in the F&I dollars per vehicle sold. In this segment, our consultants continue to report on the processes and action plans.
The F&I staff had some confusion over the F&I log process. According to policy, the log was to be e-mailed to both the sales manager and general manager prior to leaving at the end of the day. The policy was being followed, but with some issues surrounding it. The main issue was Joe’s computer did not have the correct programs to run the F&I log file, consequently, he was maintaining another complete customer F&I log on his home computer. He would routinely complete the F&I log at home and e-mail it back to the sales manager and general manager. Worse, Fred had also begun to adopt this behavior. He was taking customer information home, completing the F&I log and e-mailing it back to the managers.
It was strongly suggested to the general manager this type of action not be allowed. While it is commendable that Fred and Joe were taking the initiative to complete additional work from home, this behavior is not in compliance with the dealership’s privacy statement. This behavior can be corrected simply by getting the correct and necessary software that would enable Joe to run the F&I log program at the dealership.
According to federal and state regulations, the dealership must have its own privacy statement and have it displayed in the F&I area. Although the dealership does have a privacy statement, it was not posted in the F&I area. Compliance displays were installed during this visit. In addition to the privacy statement, both Fred and Joe were unaware that privacy notices must be provided to every customer that is applying for credit with the dealership. Additional discussions with Fred and Joe revealed they had not been in the habit of giving their retail finance customers the privacy notices. It was explained to them that privacy notices are part of every retail finance application. Once the application is completed, the privacy notices must be provided to the customers.
The remainder of the time with the F&I department was spent finalizing written F&I staff job descriptions and developing F&I goals with the sales manager. These goals must be revised and presented to the team members every month. Job descriptions are fluid and should be modified when necessary to reflect the current needs of the position.
The following action items were recommended as non-negotiable practices to be put in the policies and procedures manual for the department:
Gart Sutton has been a leading provider of on-site dealer consulting, dealer 20-groups, online financial composites, accounting rescue services, and OEM and dealership training solutions for nearly 30 years. For additional information on these services, visit www.gartsutton.com