Maximizing F&I product sales can transform both dealership profits and long-term vehicle value. On today’s episode of F&I Today, Paul Brown, Vice President of Ascent Dealer Services, provides actionable strategies to increase product penetration, maximize ancillary sales, and enhance vehicle resale value, strengthening dealership profitability.
"The service contract is the engine that pulls the train."
Service contracts remain the central product in the F&I suite, often driving additional ancillary sales. When dealerships successfully sell a service contract, other products, such as gap coverage, tire and wheel protection, or key replacement, are more likely to be purchased. Brown emphasizes that the service contract plays a critical role in increasing overall product per deal and boosting the dealership’s bottom line.
Dealers encounter customers who decline service contracts, often due to cost concerns or lack of prior repair experience. In these cases, focusing on ancillary products becomes critical. Brown identifies tire and wheel protection, key replacement, and protective coatings as high-value alternatives that can still generate substantial revenue. He stresses that dealership staff must understand each product thoroughly, including coverage limits, repair costs, and typical claims, to present them convincingly.
Tire and wheel coverage is particularly important in today’s market. Vehicles increasingly feature larger wheels and lower-profile tires, which are more prone to cracking rather than bending upon impact with road hazards. Replacement costs for high-end rims can reach $1,500 per wheel, with total potential tire and wheel expenses exceeding $7,000. Brown recommends that dealers communicate these risks and costs to customers, highlighting the financial protection these products provide. Tracking claim trends with representatives and service departments ensures staff can provide accurate, data-driven explanations to customers.
Protective coatings have emerged as another high-impact ancillary, with penetration rates in some dealerships exceeding 50%. These products preserve both the interior and exterior condition of vehicles, reducing wear, stains, and damage over time. Brown notes that cars with protective coatings maintain significantly higher paint gloss and interior quality, which translates directly into increased resale value. Condition, he emphasizes, is one of the top three factors buyers consider when evaluating a trade-in, along with mechanical reliability and vehicle options.
Integrating service contracts, tire and wheel coverage, and protective coatings into a comprehensive product bundle enhances the ownership experience and positions the vehicle for maximum trade-in value. Customers experience lower repair costs, maintain the vehicle’s appearance, and benefit from improved resale value. Dealers can present these products as both short-term protection and long-term investment, demonstrating the tangible benefits of each product with supporting claims data and market trends.
Brown advises dealers to remove outdated products from menus to avoid diluting the perceived value of high-impact ancillaries. Focusing on products that deliver clear financial and experiential benefits ensures that customers understand the real value of their purchase. By training staff to understand products thoroughly, track claim and cost trends, and communicate benefits effectively, dealerships can increase penetration, customer satisfaction, and long-term profitability.
Focusing on strategic product bundles and knowledgeable presentations, dealerships can maximize revenue, strengthen customer relationships, and enhance the trade-in value of vehicles. Ancillaries, when properly leveraged, provide both immediate financial gains and long-term benefits for owners, reinforcing the importance of a structured, data-driven approach to F&I product sales.
