To help evolve finance and insurance practices and make sure dealers are in step with changing customer expectations, it’s important to present product offerings early in the sale and deliver a speedy transaction. Customers today are going to come in with extensive research on the type of vehicle they’re getting and how much they are looking to spend on their monthly payment, but F&I products are not likely something that they have done an extensive deep dive on. Utilizing space on a dealership website to highlight financing and insurance options can help get customers engaged in the discussion, provide them with specific information, and expedite the sales process before they step foot into the dealership.
Planting Seeds and Addressing Specific Needs
Another effective strategy is to encourage sales personnel to start planting seeds early in customer interaction. Whether it’s during an initial sales call, test drive, or tour of the service department, consistent conversations about finance and insurance products can help address the customer’s specific needs. It’s important to avoid overwhelming the customer with an exhaustive presentation of every available option in the suite of F&I products. Instead, empower the customer to make decisions based on the value they perceive in the offerings.
Affordability and Optimized Payment Structures
In today’s ever-changing car market landscape, customers are not only seeking a timely and efficient experience at the dealership but also affordable payment options. Rising financing rates and supply chain challenges have led to expensive average vehicle payments. To address this, lenders and dealers should collaborate closely, build strong relationships, and optimize payment structures for customers.
Linking Affordability and Finance and Insurance Practices
Affordability and financing and insurance are closely linked as they both revolve around protecting a significant financial investment. The F&I presentation provides an opportunity to highlight scenarios where customers could potentially face high repair costs if their purchase isn’t covered by a vehicle service contract. Similarly, offering options for vehicle maintenance can help customers lock in today’s labor rates and costs, shielding them from external factors such as inflation.
Embracing the Rise of EVs
As electric vehicles (EVs) become more affordable, their adoption rate is poised to increase. Dealerships can position themselves as trusted advisors during EV discussions, and adequate training is crucial. From the perspectives of F&I and service departments, dealers should ensure that all certifications are up-to-date and that personnel are well-prepared to handle EV repairs and maintenance. Offering EV service contracts during the original sale can provide added value to customers, covering costly technology repairs and unique wear and tear that may not occur in internal combustion engine (ICE) vehicles. These products and sales strategies contribute to the profitability of the F&I department as the EV market continues to evolve.
Take Action: Share and Stay Informed
Help spread the word about evolving financing and insurance practices for Colorado dealerships by sharing this article with others in the auto industry. To stay up-to-date on the latest news, insights, and regulatory updates, sign up for email updates from the Colorado Auto Dealers Association. Together, we can navigate the changes and ensure a thriving automotive market in Colorado.