EFG: Dealers Need Bridge From F&I to Service
EFG Companies’ John Pappanastos has offered new commentary on the relationship between finance and service, including the need for full integration to maintain dealer and agency revenue.

DALLAS — EFG Companies, home of the award-winning Hyundai Assurance program, has released “Prioritizing Customer Service,” a new video featuring the company’s president and CEO, John Pappanastos. The executive sees an on-ramp to profit via an elevated bridge between the F&I office and the service drive. The relationship between the F&I office and the service drive has always been a tertiary strategy, Pappanastos points out, and “road-savvy” dealers now recognize that failure to accelerate that relationship will sub-optimize revenue potential and detour long-term customer relationships.
In its announcement, the company noted that disruptive business models, like Carvana and Vroom, have grasped the concept of utilizing customer service as a means to more efficient conversions. A high level of customer service is becoming a requirement for doing business, especially among millennial consumers, who demand their needs be met on their terms. According to Cox Automotive, only 66% of this demographic is satisfied with the dealership experience, and 79% want to learn about F&I on their own, before they visit the dealer. In addition, 63% of shoppers across all age demographics are more likely to purchase F&I products if they could learn about them on their own time before purchase.
At EFG’s recent annual Agent Council, agents from across the U.S. discussed ways to accelerate the relationship between service and F&I.
“Our dealership clients are under pressure from the OEMs to increase customer retention,” said John Kane, co-founder of Empire Dealer Services, which took home EFG’s Top Agent Award at this year’s event. “However, even if you take out that pressure, it’s still clear that the most successful and cost-effective way forward is customer retention. And, the best road that I’ve seen toward achieving repeat business is by aligning all dealership departments with this goal.”
This culture shift of placing extreme emphasis on customer service involves training the sales and service team members on the benefits of the F&I products sold in finance to both the dealership and consumers. “Unit sales has always been priority number one in our industry,” said Mike Dunahoo, Owner of Abilene, Texas-based Star Auto Group. “While that priority remains, never before in history has the service drive been potentially the greatest lever for future success. Now, the service drive is as important as sales to continuously and genuinely please customers through value-driven information and motivating incentives for service.”
The industry has already seen tech-based relationship-building tools, like EFG’s Driver’s Advocate Mobile App System, enter the market, Pappanastos said.
“We’re starting to see greater utilization of digitally-based products, like Driver’s Advocate, to create more relevant and timely communication between consumers and dealerships, facilitating a more one-on-one relationship,” he said. “In the next few years, F&I administrators and dealers need to work together to fully realize the potential these tools provide when it comes to customer service and retention.”
Additionally, the industry can expect to see a resurgence of maintenance programs in terms of both implementation within the dealership as well as an evolution of the programs’ features and offerings. “While maintenance programs have always been around, our dealer clients are asking for support in how to best utilize them,” said Kane. “Most dealers fail to recognize that a maintenance program’s sole purpose is to foster customer retention. That means selling the product at, or near cost to increase product penetration, and therefore, customer retention.”
Lastly, Pappanastos added, recognizing the need for greater customer service goes hand-in-hand with an increased focus on training in the service center. “Dealers don’t have to reinvent the wheel to remain competitive. Integrating operations between the service drive and the F&I office creates a natural customer retention cycle. However, this integration will take more than selling F&I products. It will require dealers to invest in the service center by providing service managers more comprehensive training around customer service and sales. For example, EFG has taken proactive steps to build out a full portfolio of training services for virtually every aspect of the dealership, including service manager training.”
To watch the video, click here.
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