The Finance Department in a car dealership is tasked with obtaining most favorable financing options for the customer as well as maximizing profitability by selling F&I products. A lot of time I see that there is no uniform process when it comes to this critical profit center. Dealers rely on the best efforts of their Finance Managers instead of focusing on standardized process and performance benchmarks. Product penetration percentages and PVR are not mentioned in the job descriptions and a lot of times dealers hope for the best. Menu selling is the most effective tool when properly used to make sure that 100% of products are presented to 100% of customers 100% of the time. Most sophisticated dealers use electronic menus that integrate with their DMS systems; however, installing a menu system is not enough. It is absolutely critical to implement effective policies and procedures in order to obtain a desired outcome.
Below are most effective policies and procedures:
It is essential that there is a fail-safe mechanism to make sure that Finance Managers are using the menu. I recommend not to bill a deal unless there is a signed menu. Another way is to use a menu that monitors key strokes; this way dealer will know how much time finance manager spent presenting each product. Following these tactics will allow Finance Department to increase product penetration and gross profit while increasing customer retention.