“Oh great. I have to take your turnovers?”

I didn’t even know what those words meant when the business manager said them to me on my first day as a sales representative so many years ago. This fact only served to exasperate the business manager, who had to actually tell me what a turnover was, and what he did with them.

Huh, I thought, that’s nice, he’s already mad at me for not knowing about the business office, and besides, how can I control the turnover to make my people better or worse for him anyways?

A lot has changed since then, and I went on to be a successful business manager prior to becoming a general manager, but I still encounter dealership staff, sometimes even the dealer themselves, who don’t understand the business office and how to sell cars in a way to enhance their F&I opportunities.

With the increased focus in recent years on moving used inventory through new-car stores, we have seen some big fundamental differences in the product, with the addition of off-make and out-of-warranty units. Along with this has come a change in the customer demographic and their needs, with many more cash strapped, payment sensitive buyers with limited insurance protection and little or no job stability. It only makes sense that these two variables will change the total value proposition of F&I.

The reality of Canada’s auto industry today is that dealerships cannot be profitable by selling new cars alone.  Take away service and the business office as revenue streams, and the financial statement is outright red for many dealers. So why are so many dealers willing to let the F&I opportunity slip by?

One reason I come across is that dealers question the actual value of the products offered by F&I suppliers. Certainly, there are variations in product, and in the administration of related warranty or guarantee claims and dealers must ask the right questions to determine the caliber of their selected product partner. Picking the right partner, one who has quality products, a good track record of end user satisfaction, and who offers training and other tools to help your business grow as well as good expense allowance or commission to your store, is the first crucial step to making F&I sales add to your dealership’s success.

Another explanation is that some dealers are still afraid that being an F&I focused dealership means that they will somehow hurt their customer’s satisfaction, or even cost them deals. In years past, some methods for offering products in the business office were not exactly customer friendly. Phrases like “hammer them in the box” were a valid description of many customers’ experiences. Today we know that being customer focused in F&I right from the start of the sales process only adds positively to a customer’s dealership and ownership experience.

At the end of the day, there is only one place in your dealership where you can add gross and net profit without any financial investment: no expensive inventory to keep, no salaried staffers to pay and no special software required. Simply give some thought to how you want F&I to exist in your dealership, who you will trust as a partner for products and training, and get ready to make some positive changes in your sales and service department to support a customer focused F&I experience.