Any good F&I professional knows that drilling down to the specific objection is only half the battle. To successfully turn an objection into a sale, a F&I manager must master the fine art of matching the right technique to the scenario at hand. Let’s review some of the most common objections and the word-tracks that will allow you to overcome them without sacrificing gross.

These techniques take for granted that the specific objection is known, whether it be payment- or value-related. Payment objections are easier to overcome because the customer is not objecting to the value of the product; rather, he or she just thinks it costs too much. And that’s not a deal breaker. In fact, it means that, in principal, the customer has already agreed to purchase the product.

Now, if the customer is objecting to the value of the product, a more structured technique is required. Remember, value objections are more challenging and take longer to work through, so it’s key that the F&I manager slow down and determine the customer’s true objection before closing the sale.

1. Variable Payment vs. Fixed Payment

The Situation: The business manager has presented a menu and the customer has elected to take the base payment of $537 without additional products.

When to Utilize: This close works whenever a customer takes the base payment on the menu. It also can be used with finance or lease customers who have not enrolled in wear-and-tear coverage, as well as cash customers who don’t want to buy anything on the menu, especially those who indicate they are paying cash to avoid a monthly payment.

When to Avoid: A customer has agreed to purchase products.

The Small Print: The business manager needs to determine the average repair bill at the dealership. To do this, have the service manager calculate what the average repair cost is, excluding maintenance items. This number should include repairs made under factory warranty, service contract repairs and out-of-pocket repairs.

Business Manager: Mr. Customer, I’m surprised you have elected to go with a variable payment instead of the fixed payment option. Why is that?

Customer: What are you talking about?

Business Manager: By going with the $537 payment, you are choosing a variable payment. With our dealership’s average repair cost exceeding $800, your payment will be $537 for some months and $1,337 for others. I know everyone is doing everything possible to save money, so am I right in assuming that the higher payment would be difficult for you?

By enrolling in the service-contract program (additional products may be justifiable to the customer), you could budget in the cost of repairs today for parts and labor, which means you would have a fixed payment of $572. Which is easier for you to budget, $572 or $1,337?


2. Agree to Buy in Principal

The Situation: The customer is objecting to the payment for the product. He or she has agreed to purchase a package priced at $537, however, the customer objects to the next package up, which is priced at $572.

When to Utilize: Whenever a customer agrees to purchase in principal, but objects to the payment amount.

When to Avoid: A customer is objecting to the value of the product rather than the payment amount.

The Small Print: Do not ask the customer for the amount of cash down to match the original agreed-to payment.

Business Manager: So you’re telling me that you would like the security of the package if the payment was closer to the $537 you agreed to. Is that correct?

Customer: Yes.

The key here is to fall below the plateau number. Plateau numbers are payment increments that are in the customer’s mind. These plateau numbers typically fall into the $20 to $25 payment jumps. Now, the customer may have come to the dealership expecting to pay between $500 and $525 per month, but he or she did not enter the dealership with a $537 payment cap. By looking at the worksheet used during payment negotiations, the business manager should be able to identify the customer’s plateau numbers. Did the customer work the deal in $20, $25 or even $50 increments? Work with the customer on payment relief and aim below a plateau number. In this example, the payment with the greater product level is below the $575 plateau number, but the customer is unwilling to commit. The new target point should then be below $550 per month.

Business Manager: The easiest way for you to get the protection you want at a payment you’re comfortable with is to put an additional $ – down. That will bring your monthly payment down from $572 to $548. Which would you prefer?


3. 99.9 Percent Reliability

The Situation: The customer objects to a service contract because his or her vehicle is considered to be reliable.

When to Utilize: This close is best used with your number-crunching and brand-loyal customers. It’s also useful with customers who are purchasing import vehicles or to justify the price of a service contract.

When to Avoid: When the customer is objecting to the payment, not the value of the product.

The Small Print: Utilize the back of the menu or a blank piece of paper to perform the math this close requires. Make sure all calculations are performed in front of the customer. First, engage the customer and have him or her participate in the math. Use the average repair bill for the dealership as described in the “Fixed Payment vs. Variable Payment” close. Based on the average repair bill, adjustments may need to be made to the number of repairs that the customer will be responsible for. Be sure that the dollar amount used for this close isn’t so high that you discourage the customer from buying on that day.

Business Manager: That car does have an excellent reputation for reliability. However, would you be satisfied if it was 75 percent reliable?

Customer: No.

Business Manager: Would you be satisfied if it was 99.9 percent reliable?

Customer: Yes.

Business Manager: Your new vehicle has approximately 16,000 moving parts. If it was 99.9 percent reliable, that would mean 16 parts may fail during your ownership of the vehicle. If your vehicle is better than 99.9 percent reliable, or the manufacturer’s limited warranty paid for some of the repairs, would it be fair if you were responsible for, let’s say, only six repairs?”

Customer: Yes.

Business Manager: Well, six repairs at an average repair bill of $800 may be opening you up to $4,800 worth of repair bills. Wouldn’t it make more sense to enroll in a service-contract program that will pay for all repairs, a rental car and the sales tax?


4. First 36 or Last 36

The Situation: The customer is objecting to a service contract because the vehicle already has a manufacturer’s limited warranty, and that’s “good enough.”

When to Utilize: This close can be used for this specific objection and with cash customers who say they have the ability to pay for repairs out of pocket. This close can also be used when a customer utters a broad objection, such as, “No, thank you.”

When to Avoid: When the customer is objecting to the payment or another specific objection.

The Fine Print: Based on the customer’s original response, adjust the amounts and percentages of the value added by a service contract.

Business Manager: If the manufacturer gave you the option to purchase the vehicle without the warranty, how much less would you expect to pay for the vehicle?

Customer Response No. 1: $3,000.

Customer Response No. 2: I would walk away.

Business Manager: So, if the vehicle would have to be priced $3,000 less if it was available without a warranty — which, as you know, would expire in ­– months — that would make the manufacturer’s warranty, based on the amount of years you said you planned on keeping the vehicle, worth $­ –. However, since the manufacturer doesn’t offer that option, I can triple that value. By enrolling in our service-contract program, your vehicle will be covered for ­– miles and ­– years for about a third of what you said the warranty is worth.”

Handling the objection with the appropriate technique is a difficult task for any business manager. At the very minimum, you want to have some sense of direction when overcoming an objection. The techniques addressed here should be core tools for any business manager. With a little practice, mastering the fine art of objection handling will be a cinch!

Tony Dupaquier is the director of F&I training for American Financial & Automotive Services Inc.’s Automotive Training Academy. E-mail him at [email protected]

What's your best close? If you have a technique for overcoming a specific objection, e-mail it to the editor at [email protected]