What’s Wrong with F&I Turnover

It was during my very first sales meeting when I started selling cars that I was inspired to action. I recall there were about 15 salespeople sitting around a large oval table. On the walls of the conference room there were many pictures all containing inspirational quotes. One that stood out for me was a picture of Vince Lombardi that said “Winners never quit, and quitters never win.” My initial thought was no $#!+! But it really hit me once the meeting started. 

Behind me was a large whiteboard filled with each salesperson’s name, and beside each name there were X-marks going across the board. Our sales manager began the meeting by pointing out those Xs. Turns out they represented the number of sales each person had. One of the first questions our sales manager asked during the meeting was “Who’s going to win the leaderboard this month?” And yes, I raised my hand. Well, that was embarrassing because the top guy had 12 vehicles out and I had none — after all, it was my first day. 

Now comes the “Winners never quit, and the quitters never win” quote. That was my explanation for raising my hand. Though I did not win the leaderboard that month, I did become one of the top salespeople within the next few months and everyone, as they should, tried to keep up with me. The reason I bring this up is, I soon learned the sales department is dedicated to chasing the metal and the F&I department is dedicated to chasing the Benjamins. Further along in my career, I realized why there is so much tension between sales and F&I. In the end, when a dealer principal or GM ask about sales, they almost always refer to the number of vehicles that have been sold, always chasing market share. When they ask about F&I, it’s almost always about the profit per vehicle, always chasing the money. Like oil in water, it separates. Bringing these two departments together takes effort. The kind of effort that can be had by not allowing mediocrity to outplay your process.

It Takes an Effort

It’s not the quantity that counts, It’s the quality. The quality of the F&I turn-over once a sale is made. A deal happens after a customer meets three agreements; an agreement on a vehicle, an agreement on a price and an agreement to take delivery. Only when these three agreements are met do you have a deal. 

Once the deal is made, it’s now onto the F&I portion of the transaction. This is where it takes an effort for things to work — an effort on the salesperson to follow the dealership’s process, on the sales managers to see to it that the salesperson follows the dealerships process, and on the F&I managers to follow the dealership’s process and fulfil their role in taking action immediately following the three agreements.

To say, “we turn everyone over to F&I” is not enough. Though you may have the quantity, how is the quality? Is the paperwork complete and accurate prior to the turn-over to F&I? Is the structure of the deal appropriate prior to the turn-over to F&I? Is the check list completed prior to the turn-over to F&I? Are the terms appropriate prior to the turn-over to F&I? Have the three agreements been satisfied prior to the turn-over to F&I — not to say F&I may play a role in solidifying a deal, as they often do. If you answered yes to all the questions, stop, you’re in good hands. If you answered no to any one of the questions, read on.

An Effort to Communicate

Deals are completed in a few ways — they may be completed at the dealership, online, or over the phone. Regardless of the source, you must stick to your process and procedures, or there will be a breakdown. One of the most common breakdowns I see is communication between the departments. It seems each department is on an island and each island has its own agenda. Let’s start by going back to the basic structure of a dealership’s front-end operation. Salespeople are responsible to sell vehicles, to get customers to say, “I want the vehicle.” Sales managers are responsible to sell deals, work with the sales staff to structure a deal the customer accepts. The F&I manager is responsible to deliver the vehicle and secure additional profit. 

As it turns out, that isn’t always the case. Salespeople take it too far, sales managers don’t take it far enough, and the F&I manager is left to sort it all out. It’s time to manage the business and stop allowing the business to manage you. Be sure each member of the team knows their role and stays on task. Communication starts by establishing a common goal between departments and creating a game plan each day. Getting the sales and F&I management teams together to do a daily save-a-deal meeting will accomplish that. Sales and F&I managers conducting one-on-ones with each member of the sales team, every day, also keeps everyone on task.

Correcting the Issues at Hand

Back to the quality of the F&I turnover. Why blame it on F&I, when it’s the sales staff that is unwilling to fulfill their responsibility once a deal is consummated? They are unwilling to accurately complete the paperwork necessary for the turn-over, they are unwilling to notify F&I as a deals progress, they are unwilling to maintain composure when F&I is occupied with other customers, and they often present F&I with unrealistic terms and deal structures. Right? 

Well maybe that can be debated, since F&I will often take their time before meeting or contacting customers, or when F&I does a poor job at verifying the information provided, is complacent in getting involved in a deal’s progress, or is not there to assist with securing appropriate terms or proper deal structures. Hence the whining about this and that. Complaining about a problem without proposing a solution is called whining. The sales, sales management, and F&I management staff must stop whining and instead propose attainable solutions. 

The truth be told, when a dealership accepts mediocracy, it’s the dealership to blame for the issues at hand. Let’s be clear. The managers at the dealership are to blame, as they are the ones hired to manage the process. Those who know me, know I’m a Patriots fan. Here’s a quote from head coach Bill Belichick: “Just do your job!” That’s right, just have each member of the team do their job.

Gerry Gould is the founder of Gerry Gould & Associates.