The Revenue River F By: Tom Wilson &I professionals are always growing and evolving as business marches forward lest they become stagnant and fall behind the learning curve. The balance of customer satisfaction, product penetration, and credibility have never been higher in demand. And about the time you think you’ve got everything under control, manufacturers introduce another high-tech option that causes you to change your objection handling techniques. Think about it, who would have thought-even a few years ago-that cars would not only drive but park themselves as well? Pretty soon they’ll be baiting our hooks too! Adding to our malaise, the internet explosion has evolved carrying information more securely and offering instant answers to the most complex of questions. Customers recognize it and are using this tool to their advantage. Because of this, the business model has changed drastically with off-site digital document signing, home deliveries, and a rapid move to a virtual marketplace. Tech has taken such a major part of the design and build of today’s vehicles that the Drivers Ed classes of tomorrow won’t deal as much with steering, gas & brakes but which button to push and when. So, what’s an F&I pro to do to keep up? Go fishing; that’s what! Yep, stand on the bank and take a good look at your F&I Revenue River. Where does it begin? What “tributaries” feed into it along the way? Is it still flowing along the same path as it did a few years ago, or has it changed course? Do you need a different kind of bait? How many different “springs” are in your F&I office that feed into your river? Yes, we all know the stock offerings of Service Contracts and Gap are necessary. However, have you really looked at the other valuable offerings you have that trickle money into your revenue stream? Let’s face it; we’re not making the front-end grosses on car sales that we did years ago. Yes, the semiconductor chip problem has caused widespread panic buying with artificially propped up grosses, but it will not last. Outside banks and aggressive credit unions makes it tough holding rate. That died years ago. Being the strong closers that you are, you pivoted, adapted, and looked for more offerings to present. Listen, today’s cost-conscious customers are looking for value. They know their ownership experience is going to cost a lot more than ever before so you need to present packages that match their driving habits. Dave Sipus once said “A little plus a little plus a little equals a lot. Many manufacturers are offering complimentary maintenance to entice buyers. Pre-Paid Maintenance policies that extend or expand the factory maintenance are huge across all brands with a high acceptance rate. Customers who are pre-budgeting to keep their monthly automotive expenses in line know that today’s cars require more maintenance than they did 10 years ago. So, unclog the PPM creek and let it flow. Now, we often hear about our transportation infrastructure being in worse condition than ever before. And technology has led to lower profile tires improving handling along with lightweight aluminum wheels. Many potholes are deeper than most tire side wall heights. Combined, this is the perfect storm for tire & wheel damage. Let a good tire & wheel policy rain money into your stream. Technology is astonishing in today’s new vehicles. Everything right down to the key fob in your pocket requires a battery, a chip and programming. If you’ve seen the price of a replacement key fob lately, your customer is at the mercy of little Bobby playing, “drop mommy’s keys in the toilet.” True story from one of my customers. With the current chip shortage, do you think that chip-driven components like key fobs are going to go up in price or down? A good key fob replacement policy adds another high value, low-cost item for your customers plus more money to trickle into your brook. Listen, I’m not giving you anything more than you already have. I’m just reminding you to invite customers to more closely examine what’s being offered because they need it now more than ever before. The late Dave Sipus once said “A little plus a little plus a little equals a lot. By diversifying your offerings, you’ll continue to add more and more money to your bottom line and create a loyal base of repeat customers with a steady stream of income so you don’t have to rely on VSC’s and Gap alone. Happy Sailing Selling! 9 Tom Wilson is a Sr. District Manager for Hyundai Capital Insurance, covers Virginia, Maryland and West Virginia, and is a 30+ year veteran of the car industry.
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