When you ask a top-shelf F&I manager how many swings they take when trying to sell an extended service contract, they will usually respond, “As many as it takes.” Ask a mediocre player, and they’ll usually say two or three.
How many swings do you take? This is not baseball. The only way to strike out is to stop trying!
There are at least five basic swings available to an F&I Manager when selling an extended service contract to a customer. Let’s take a look at these five key plays.
The Menu Swing
The Menu Swing should always be your first attempt. During the menu presentation of the benefits that are available to the customer at the time of sale, we have the first opportunity to offer the customer the option to say yes. Using a menu to offer the product also allows the F&I manager to be compliant with the 300 percent rule and have written evidence of compliance. Most of successful F&I professionals interviewed expressed the importance of making the explanation of benefits of the product very basic on the first pass on the menu. They stress the importance of retaining the power of the ancillary benefits for the second swing.
The Ancillaries Swing
Most Extended Service Contracts include a list of ancillary benefits that add value to the product over and above the parts and labor benefit for mechanical failure. Some of the benefits often include a towing benefit, trip interruption and rental vehicle benefit. A picture can be painted of a scenario that puts the customer in a vulnerable situation so that they can see the need for the product. This swing requires the F&I manager to be very familiar with the features of each available benefit and the limits of each.
The Horror Story Swing
The third opportunity to hear “yes” comes when we take The Horror Story Swing. This swing requires some finesse and documentation. The finesse is in the F&I manager’s ability to tell a story that paints a picture for the customer and is 100 percent true. If the dealership has been selling or servicing extended service agreements, there have been some claims and therefore some good stories to back up the claim for the customer’s need of an extended service contract. The next requirement for this swing to be effective is documentation. The F&I manager needs to have current work orders that correspond with and give legitimacy to the horror story. Most successful F&I managers have “evidence binders” that include several different work orders and copies of paid claims as well as work orders for similar claims that were not covered and therefore customer paid. This is a very powerful swing in the hands of a good batter.
The Reduce to Ridiculous Swing
The Reduce to Ridiculous Swing is simple but important to use because it can put the cost of peace of mind in perspective for the customer. By dividing the cost of the warranty over the months, days or even hours of the loan term or ownership period, it seems ridiculous to not take advantage of all the benefits and the peace of mind that an extended service contract brings.
The Budget Close & The 99 Percent Close
When it comes right down to it, every objection a customer could offer as to why they do not want to take advantage of the benefits and peace of mind that comes with an extended service contract can eventually be reduced to cost or value. Either the customer does not budget for it or they have not seen the value. The A-player F&I manager always has a logical path to take the customer down for either situation. The Budget Close and the 99 Percent Close are examples often used. The customer is shown that the logical conclusion is to take advantage of the benefits offered. Who wants to be illogical? The customer has now had five simple and logical opportunities to say, “Yes.”
There are other swings that can be taken, but these are five easy swings for anyone to master. The order is important as each swing builds upon the last and takes the customer down a logical path. The successful F&I Managers will all tell you it takes more than three swings to be a pro player in this game.
