Most dealerships have split the sales process from F&I, treating it as a separate process after closing the deal.

Though it works fine for many dealers, there is a better way of revising it that increases the closing ratio, and the profit per unit while lowering the total time it takes to complete the transaction. The earlier you introduce the financing process as part of the sales cycle, the more chances you’ll have to close the sale with better margins in a lot less time.

Pre-Qualify Before the Car is Chosen – Better Transition to F&I

Nearly all major finance companies are able to provide instant pre-approvals based on limited information (name, monthly income, SSN, etc.). The pre-approvals typically come with an estimated credit limit so that you can define the budget for your customer. Banks and credit unions will also have the ‘number’ the customer needs to use when choosing their car.

This will allow you to focus on the units within their budget and increase your chance of making the sale.

If you can pre-qualify your customer very early in the process after having a quick initial conversation about the vehicle type that they are interested in, you can immediately focus on the units that they can afford, save time and set the expectation right from the beginning, which will increase your chance of closing the sale.

Focus on Payment, Tune Out ‘Discounts’

It’s not uncommon for a customer to ask for a discount of the best price you have offered. They have the misconception that you have huge margins built into every car, and you can afford to discount deeply. The requested discount on the price may represent only a few dollars deduction in the monthly payment.

By introducing financing options early in the sales process, you can easily move your customer’s focus from the price to monthly payments that they can afford. If you provide details on different financing options and the required down payment/monthly payment combinations, the discounting will no longer be part of the conversation.

It’s important to try to reach their desired payment level by adjusting the financial attributes such as repayment term, required down payment and/or dealer participation so that discounting is not required to satisfy your customer’s goals. If they want a $400 payment, find the car and terms that makes that happen (with a VSC and/or GAP included if you can).

It’s all about how early you introduce financing to your customers, always making it a positive experience after the initial conversation to gauge their interest level.

How you phrase this process matters. so instead of something that sounds negative like, “Let’s submit a financial application and see if you get approved,” which may scare your customer away or make them feel self-conscious about their financial profile, try a softer and more positive approach. Consider something like, “We have some fantastic promotional offers this month and I’d love to show you some of the low monthly payment options.” The customer is immediately more receptive and hopeful that their dream car is within their reach.

Sales associates should work with the finance managers as a team behind the scenes to determine the best financing options when still working on their sales. Overlapping the sales and finance functions will help you save time, increase PVR/CSI, and close more sales.

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