Over the past several years, I have spent a lot of time looking at dealership numbers and talking to sales and finance managers about how they do what they do. Through this exercise, I have been able to quantify what behaviors, environments and approaches produce the best results in a finance office and why.
In the coming months, I will share with you the top reasons that these finance managers are so successful. Whether you are a finance manager, a sales manager, a general manager or a dealer principal, you should take some time to focus on the most profitable square footage in your dealership: your finance office!
When I look at the dealerships that produce profits in the top 10 percent of the nation, certain trends start to show. The most obvious one is that all of the finance managers meet the customer out on the sales floor immediately after the sale is closed, if not earlier.
There are several things that they accomplish by meeting the customer early. First, they are able to build better rapport with the customer by meeting them where they are comfortable. One of the things that we know about rapport is that the more you have and the more the customer likes you, the more they will be willing to spend with you. We also know that if it takes a little longer than expected to get the paperwork ready, they will be more forgiving if they like you.
The second thing that it allows the finance managers to do is make sure that they have all of the information they need to do their job. The top timewaster in the finance office is inaccurate, incomplete or illegible information. By verifying the credit application and worksheet information with the customer, they are able to eliminate these slowdowns. This step is what gives the finance managers the time they need so that they can go out and meet every customer.
If the customer is paying cash or financing with a source other than the in-house finance offer, this also gives the finance manager a chance to talk about why the customer should finance with them.
I have heard a lot of different ways to get the true source of the customer’s money. Unfortunately, most of them can be (and regularly are) answered, “none of your business” or with erroneous information that does not lead you to the actual source.
Here’s the best way I’ve heard to get the actual source of the money from the customer: After the finance manager has verified how the customer wants their title registered, address, etc., he or she says, “The last piece of information I need is your lienholder address” (I will talk about this in greater detail when we discuss converting a customer to your financing next month). This allows the customer to share with you exactly where the money is coming from without ego getting involved. They understand that you need this information so that you can make sure the paperwork is done correctly. After they tell you where the money is really coming from, you can start to talk about why they might want to finance with you.
The last thing that the top finance managers do is let the customer know what will happen between now and when they see the customer again, and roughly how long that will take. When a customer asks, “How much longer is this going to take?” and the salesperson says, “Just five more minutes,” that’s a good way to make the customer mad. The best way to stop this is for finance to give the customer a realistic timeframe before the customer asks a salesperson. By doing this, the customer will be much more likely to come back to your office happier and buy more.
The explanation should go something like this: “OK, Mr. Jones, the next thing that is going to happen is Bill, your salesman, is going to introduce you to someone over in parts who can answer any questions you may have about accessories, gear, etc. Then, they are going to take you over to service where they will go through your bike with you. When you are done there, I will take care of everything else we need to do so that you can take the bike home today. I should see you again in about 30 minutes. That should give me enough time to have everything ready. Thank you.”
Your explanation should cover whatever your customer will experience in your dealership. If you are not introducing the customer to parts and service and are curious about the advantages of doing so, stay tuned for future installments, or you can always drop me a line at [email protected].
Steve Dodds II is a moderator, trainer and consultant for Gart Sutton and Associates with experience in every position in the sales and finance departments. Dealers rave about his ability to identify areas for improvement and implement the changes that produce superior results. If you have questions about what he or one of their other talented consultants can do for you, contact [email protected].