When consumers shop for vehicles, they initially are looking at what the price is to buy the same vehicle from each dealership they choose, usually via the internet. Then, they reach out to the dealers that have responded in a timely manner with comparable prices. Then, the dealer that does the best job from there, usually sells their product.
Ok, where am I going with this? Advanced F&I Solutions is an F&I development company that provides our dealers with a total solution at a cost of doing business so competitive and complete, we always get asked “where have you been the last 18 years?” Our response is your gatekeeper wouldn’t let you talk to us.
One of the big box companies just recently released a memo to dealers explaining to them that their “reduced” reinsurance fees “should substantially improve participant’s returns.” SHOULD? I couldn’t believe this was put out in a memo; OF COURSE it will improve your returns by not taking money out of your dealers reinsurance companies. What’s crazy about this, is these are REDUCED fees, meaning they are STILL being charged fees above the admin fee.
We recently started doing business with an 8 store group in the western part of the US that was with a big box that told them $1400 a copy was the best they would ever do. The dealer wasn’t satisfied with that, and neither were we. It didn’t happen over night, but 8 months into our relationship this dealer group just had their first month finishing at $1966 a copy after charge-backs. Our selling system creates an environment that allows your F&I managers to separate the presentation phase from the closing phase in the F&I office. Our development plan is centered around measuring the ‘effort’ that goes into each F&I result to provide real coaching that F&I managers actually embrace because they are being developed rather than being annoyed. If you are asking your F&I managers to present F&I products on a menu, whether paper or digital, there is a better way. Now, after our first quarterly reinsurance review with this same dealer above, he told us he learned more about reinsurance in 90 minutes with us then he had in his previous 15 years of being in reinsurance. Transparency. We believe you should know exactly what we know.
The point of this article is I understand relationships are important in this business, and they should be. But if you find your self not knowing things like loss adjustment expense fees, ceding fees, how often is written premium ceded, how much is ceded, what is my admin fee, why hasn’t my F&I department increased PVR consistently, is my department compliant, then you haven’t evaluated the cost of doing business as each of your customers does with you. Paying more is ok, as long as you know why, and are getting more to justify paying more.
To learn more about a team of professionals that are second to none in income development, reinsurance companies, contract administration and more, don’t hesitate to reach out to me. firstname.lastname@example.org