GWC Warranty acknowledged that perhaps the most difficult obstacle to overcome in the dealership F&I office is getting customers to trust that the products store personnel are offering will be worth the added cost.
The provider of used-vehicle service contracts sold through dealers insisted in a recent blog post that establishing trust is the first step in building the foundation for long-term F&I success.
“But how do you go about gaining the trust of someone whose money you’re looking to spend on additional products like a vehicle service contract? Just like most things in life, honesty is the best policy in the F&I office,” GWC Warranty said.
“Being upfront about monthly costs, coverage limitations and the company backing your products will help customers feel the confidence they need to feel in order to make a service contract purchase,” the company continued.
GWC Warranty went on to dissect transparency even further, delving deeper in four specific areas.
For the vast majority of customers — especially within the subprime credit spectrum — GWC Warranty pointed out that many dealerships and finance companies are negotiating on monthly payment and potential buyers on board with how the cost of a service contract impacts what hits their bank accounts each month.
At a glance, the company conceded the added cost can be staggering, especially in a world where some research shows 78 percent of people are living check to check.
“But breaking it down by daily cost could help overcome this hurdle,” GWC Warranty suggested, giving an example.
The daily cost of $300 payment is roughly $10 a day. If you add $50 per month for a service contract, that daily cost is just over $11 a day.
“This nominal daily increase compared to the cost of major repairs can help customers see the value in added vehicle protection,” GWC Warranty said.
GWC Warranty reiterated that not all coverage levels were created equally.
“It’s important to impart this on your customers,” the company said. “If you’ve mastered your menu selling strategy, working backwards from the highest level of coverage achieves this goal for you.
“Focusing on what customers miss out on and using this technique in tandem with highlighting small daily cost differences, it’s easy to spell out value that will help your customer see that you have their long-term financial interests in mind,” the company went on to say.
GWC Warranty cautioned dealers that some customers may object to a service contract due to the industry’s reputation.
“But working with a reputable partner has its benefits — most notably your ability to showcase that reputation to customers,” the company said.
“When you can show customers that the product you’re selling is backed by a company with decades of experience and billions in claims paid, peace of mind will come easily — and quickly,” the company added.
Showcase past results
If the dealership has a customer who still does not trust the F&I process, GWC Warranty stressed that even the most difficult vehicle buyers can’t deny real-life results.
The company recommended that finance managers keep close a file of past work orders or a claims paid report and show that difficult buyer all the money VSCs have saved past customers.
“No customer can refute the value of a VSC after seeing exactly what it’s done for people in their shoes,” GWC Warranty said.