CommentaryOct 2nd, 2020

Cupcakes and Etch in the Finance Department


Sometimes even the best pros in this business will get a deal thrown at them that they know is an uphill battle from jump street because of how it was worked. The appearance of any opportunity is gone. This is where a true F&I pro will push pause and think before reacting compared to the know it all rookie who huffs and puffs about a "cash deal." The deal has to be done whether you make any back-end profit or not, right? Therefore, being upset about getting a stripped-out cash deal doesn't change anything except your mood right before you process the deal, important! Instead of being crapped out, look at it as two things: a challenge, and a teaching opportunity.

I recently had a deal where a salesman worked the deal as hard as he could and the desk agreed that the customer would pay $40,000 OTD. They were going to send the customer to his bank to collect his cashier's check and then complete paperwork with me after he gets his money. The salesman asked me if I wanted to talk to him before he (the customer) left, I said, of course, I want to talk to ALL of the customers. I said, go put your paperwork together, just like a regular deal, then I will do his paperwork and review any options he has available, give him his total, and send him to the bank.

After immediately bonding with the customer and knocking out all the basic forms, I went into my presentation. After careful review of the customer's offerings, the customer picks the vehicle service contract and hands me a credit card for the $2,873. He then left and an hour later came back with a cashier's check for $40,000. What just happened? The salesman actually convinced himself that he had gotten it all. It might have been all he would pay for the truck; it wasn't all he would spend on his protection options. Moral of the story - don't give up before you've even tried! Challenge yourself to stick to your process and show the salespeople who don't really believe you have a shot that you not only will take it 100% of the time but that sometimes you'll actually get it!

The salesperson's teaching moment is that once a customer writes the check, they have made the physical and mental commitment to finalize or admit on paper they are purchasing something. It is always better to make all of your offerings BEFORE you have them take that last step and write the check. That way, all of the F&I products can be considered before making the final buying decision.

The other situation that pops up from time to time is the deal that has to be written at buy rate just to get it done, so your efforts might be less motivated than if the deal had two points in it and they would only buy the vehicle if we could protect it with a VSC and GAP. How many of you desire to do a buy rate deal with etch? Not many people. This is the customer who has bought three vehicles from me in the past and always bought products and been very agreeable on the rate. Her score was in the high 600's, but this time around, the extra options just aren't in the budget. Do you push to get the deal bought and close it anyway? Absolutely. This is the lady who brings in gourmet cupcakes from whole foods before you've even prepared a first pencil. Five years ago, when she was a stranger and a new customer to the store, I offered a VSC and GAP. She shot me down on both. I persisted that GAP would be highly beneficial when a total loss occurs. She then takes the GAP and a year later totals the vehicle and is relieved to learn that because of my recommendation, she gets to walk away from that mess and start over with me fresh again instead of having to write a check for $6,000 to become a pedestrian.

Recognize that you have built a loyal relationship with a customer and that not every time they do business will be a favorable deal to the finance department. Remember though that how you make them feel, and how the salespeople see you treat the deal will impact your future dealings with both parties. Sometimes you just have to eat the cupcake and be thankful for the etch.

Authored by

Justin Gasman

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