Stump the Pro Cash Before Discount P icture this: The customer wants to purchase a product, you have them closed on the need for the product, however, it comes down to a payment issue. The customer is just uncomfortable with the payment or the ever so popular, “The payment is just too high”. We must either justify the payment or find a way to offer payment relief to the customer without sacrificing the integrity of the product. Unfortunately, an objection handling technique that maintains profitability is not the only direction. And for those of you in one price dealerships and states that all the products are rated, offering a discount is not a possibility. When the Business Manager simply discounts or offers a “cost” price for a product to a customer, you only diminish the integrity of the product you are trying to sell. You offered one price, then offer another, then another? If you were the customer and someone just continued to lower the price, I am sure you would do the same thing I would do, wait until the price got down to none, then agree to purchase. Before you start discounting or changing coverage, explain the benefits of additional initial investment, AKA cash down from the customer. The initial investment gives the customer benefits that will continue throughout the entire length of the loan. For those of you who worked in the old school 4 Square days, go back to your training roots of asking for cash down. The most predominant benefit of the initial investments is a lower payment. Everyone wants a lower payment. Additional benefits are the ability to build equity and trade more often with less finance charges. How you present this to your customer is paramount, this has always worked well for me; “Mr./Mrs. Customer, there are four primary benefits to you, when considering your initial investment, first is, the initial investment will help you lower your payment, it will also help you build equity in your vehicle, that equity will allow you to trade out of your vehicle more often, so you can drive a new vehicle more often and you will have lower loan cost. Taking those four benefits into consideration, lower loan cost, purchasing a new vehicle more often, building equity, or having a lower payment, which would benefit you most?” In most cases, the customer will respond that they want the lower payment. Your response is this, “Great, so would I, and since you told me that you want a lower payment and every dollar you put down now will give you that lower payment, with an initial investment of $X, XXX would allow you to have the products and services you need with that lower payment you desired” Never ask the customer, “Would that be ok? Will that work?” Or “Can you do that?” Tell the customer they can put down the initial investment. If you are uncomfortable with just telling the people, this is a great opportunity for a two-choice close. “You can do the additional investment and put your payment here or you can keep your original investment and have the higher payment, which would you prefer”? Either way, don’t ask a bad question after justifying cash. “Customer’s today need all the information to make an informed decision. Many customers do not want to be sold in the old traditional sense, however, if you allow the customer to have self-discovery, they are more accepting and there is a higher chance of them making the decision you would like them to make” As a Business Manager, is it our job to lead them to water or make them drink? Neither, it is to make them thirsty and show them how to quench that thirst. Remember, we are living in a WIIFM society. Please take into consideration, the amount of money you are requesting the customer to put down and the payment you are trying to achieve. Never try to back into a payment the customer has agreed to. In most cases, the customer will afford a few dollars more. It may not be twenty dollars more, however they may stretch seven to nine dollars. Also, do not ask for additional investment in the exact amount need to achieve the payment they previously agreed to. Ask for the investment in $250.00 and $500.00 blocks. If you ask for an amount exact to achieve the exact payment, the amount may seem too large and it is easy for the customer to say no. Although it is discouraged for professional negotiators to split the difference when working a payment and initial investment, split the difference between the two. Where can the money come from? The payment that’s due on their trade is a good start. If they’re trading a car back in they bought from you, any product refunds can be credited to their new purchase. Before you start reducing your profitability, changing coverage’s or get caught in a single direction negotiation, explain the benefits of the initial investment and more importantly, find out what benefits, benefits them most. 4 Tony Dupaquier is the Training Director at The Academy. As director, Tony is responsible for its curriculum, marketing, and overall growth and direction. With more than 30 years in the industry, he has held nearly every position in variable operations, from salesperson to general manager, and is a former Nissan National Walk-Around Champion. Tony has been a featured workshop presenter at the NADA Convention for a number of years, addressed international dealer groups on F&I and sales techniques, and spoken at numerous 20 Groups and dealer associations. He also contributes F&I articles to many industry publications.

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