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Does your dealership need an F&I specialist?

By Tony Willard

Clinching F&I deals has become increasingly complex over the past 18 months. Retail car buyers’ rapid shift to online research for loans is eroding the important, traditional dealer/customer showroom first contact.

Once a customer is in a showroom, and committed to buying a car, the next move is vital.



Single point of contact creates customer rapport  
New FCA credit regulations may change point-of-sale business  
Privacy in showroom is key  

There are divided opinions in the retail motor industry: some believe it’s best to keep a clear distinction between vehicle sales and F&I add-ons, others are convinced customer loyalty is built around a single dealership contact point.

The Finance & Leasing Association and its members have worked hard over the past five years to improve the knowledge of showroom teams so they can offer sound advice about loans.

Dealer groups have responded strongly. Most leading AM100 groups (and many smaller ones) are signed up to FLA SAF (specialist automotive finance) and dealerships’ share of new car finance has risen monthly since the beginning of last year. SAF is flexible enough to fit in with most dealership loans’ sales processes.

Paul Harrison, FLA head of motor finance, is open-minded about the most effective way of shepherding customers through the buying process. However, he does see advantages for dealers who appoint a single contact for each customer.

“This helps create rapport throughout the deal,” he said.

“However, even if sales executives and business managers both speak to customers, this process will be carefully managed, because dealers understand the importance of the relationship.”

Harrison said sometimes just one person with the appropriate regulation compliance training was permitted to discuss finance with customers.

However, changes are coming that could force dealers to rethink the way they conduct F&I sales.

Advances in technology, and a revised regulatory regime for consumer credit, may well lead to new point-of-sale business models, he said. “We’ll know more when the Financial Conduct Authority publishes its next consultation and that is expected late this month.”

Mark Gow, DSG Finance sales director, said the F&I sales process needed to be sensitive to customer privacy, particularly for those with an adverse credit history.

“Dealers who provide customers with a dedicated finance specialist allow them to discuss funding requirements confidentially away from an open showroom,” he said.

“The significant rise in people pre-arranging finance online prior to ordering a vehicle demonstrates a desire for privacy in this part of the transaction.”

Gow said providing loans for used as well as new cars was another factor in deciding on a dealership’s F&I process.

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  • David wright - 10/10/2013 20:07

    interesting. ...lets see when the fca publish

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  • max - 11/10/2013 13:59

    Alot about the 'F' here but less about the 'I'.......what's the bet figures are being banded about with the 'I' included before a proper disclosure and demands.......even in sites with BMs. A good (compliant) BM, all well and good, but a bad BM' there's a risk that few think about.Think about this - 4 execs, no BM, one exec goes off the rails - 25% risk of FCA issues. Or 4 execs, not allowed to sell insurance, 1 BM, who goes off the rails - 100% systematic failure on FCA issues! Do senior management have the MI and details to monitor this....? Add this to the F element and potential mis selling credit the risks are mounting. Industry needs to remind themselves about the wider TCF issues, not just the bottom line. Sell non compliantly today, regret later, and pay out as CMCs come to the party, again!

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