Who doesn’t like unwinding with an adult beverage after a long day? Well, this month, I’d like to talk about the other, less relaxing definition of “unwinding.” I’m talking about unwinding a retail deal that has already been delivered. You may think I’ve finally fallen off my rocker, but I do feel there are situations when letting a customer out of a deal is the right thing to do.

I understand why the mere mention of unwinding a deal strikes fear in your heart. It’s an accounting nightmare. Commissions need to be charged back, even if the month has already closed and everyone has been paid. Your manufacturer’s statement of origin must be retrieved from the DMV. Affidavits must be executed to retain the vehicle’s new-car status; if you don’t, you’ve got a huge depreciation on your hands. And, finally, if a trade-in was involved, the payoff must be refunded by the bank and the title received on that trade returned.

We must also contend with our pride. Many of us in the car business are Type-A personalities. It’s what makes us successful, but it can also be problematic when a customer asks out of a deal, as it’s easy for us to overlook an opportunity to satisfy the customer by re-contracting at a lower rate.

With all that said, I still believe there are situations where we must swallow our pride and endure the hassle of unwinding a deal. Let’s take a look at five such situations:

1. Run Spot, Run: Many stores spot-deliver vehicles based on credit scores and deal structure for the sake of time.  The goal is to take the customer out of the market as soon as possible to seal the deal, so the customer is asked to sign an immediate delivery agreement form outlining the deal. We can always re-contract if needed, right?

Just so we’re all on the same page, the agreement clearly states that if the dealership can’t find a sales finance company to buy the contract, the car is to be returned. The sale is then rescinded unless the customer can procure his or her own financing.  If your store operates this aggressively, you’re bound to face a situation where it’s necessary to unwind the deal.

2. Buyer’s Remorse: For some customers, the rush of a new-car purchase fades once they pull into their driveway. Maybe friends and family members caused them to rethink the deal. Maybe they realized their payment was too much for their budget. Whatever the case is, the customer is back, and they’re complaining about not being treated fairly. Bottom line, they want out of the deal. This is a situation where the deal can sometimes be saved with a little bit of good customer service. If not, bring them back in and renegotiate the products or cancel them altogether. This is an easy fix.

3. Fraud Discovery: Shortly after delivery, you discover that the vehicle isn’t for the buyer; it’s for the customer’s divorced 30-year-old daughter with the 400-plus credit score. Or you find out the customer’s 10 years on the job was actually 10 months. That commission is staring you in the face, but you have to do the right thing. Explain the situation and let them acquire their own financing or resubmit the deal with the correct buyer.

4. Vehicle Not Performing as Promised: When we sell a used vehicle at Langdale, we insist that the prospect have it inspected by his or her mechanic. Unfortunately, even that hasn’t prevented situations where the customer wants out of the vehicle he or she purchased. At my store, we view this scenario as an opportunity to win over a customer with good service. Yeah, I know all about the “implied warranty” rule, but sometimes you need to accommodate the customer.

5. He Said, She Said: It’s a tough situation when a salesperson’s promise to a customer isn’t satisfied because it wasn’t communicated to management. Nobody wins. If the dealership won’t honor the promise, then unwind the deal and move on. 

At the end of the day, it’s always at the discretion of the general manager or dealer as to what policy is observed. I’ve met some dealers who operate so tightly that deposits are nonrefundable, and they will not agree to do any kind of post-deal work unless the salesperson personally pays the bill. They would rather hire an attorney and take their chances. I’m not opposed to that since they have the real money invested in the operation. But management should be empowered to fix problems before they happen to prevent a done deal from falling apart.

Marv Eleazer is a finance manager at Langdale Ford in Valdosta, Ga. E-mail him at [email protected]

 

Author

Marv Eleazer
Marv Eleazer

Marv Eleazer

Marv is no insider. He’s an actual F&I manager with more than 20 years of experience. Get his from-the-trenches take on the industry every month at fi-magazine.com.

View Bio

Marv is no insider. He’s an actual F&I manager with more than 20 years of experience. Get his from-the-trenches take on the industry every month at fi-magazine.com.

View Bio
0 Comments