Keeping Up With Your Business Relations in a Pandemic – Consider a CRM! By: Jeff Roseberry If we’re at all like our parents and grandparents, we’ll be telling our kids and grandkids about the time in our lives when the world changed and nearly came to a stop. Without question, this pandemic is challenging virtually every aspect of how we have been living our lives up to this point. For those of us whose livelihood depends on selling directly to consumers, this is extremely challenging. As a result, we are faced with two possible scenarios: 1. Sit back and wait for this to end and hope that the government response and your financial situation will carry you; or 2. Adapt and innovate to do what you can to keep your business alive. Note that the first one is always in play and is mostly beyond your control. So why not choose the latter option? Many of us have adopted the practice of having virtual meetings through applications like Zoom, Microsoft Teams, Google Meet and several others. These are critical tools for your trade – and we now know that they can work well! But is this enough? Working from your home can be convenient, but it has its challenges. Business phone & video calls and meetings typically require documentation and follow up. You can go about this by writing everything down, but there are other tools available in the Cloud, many of which are available at no cost. Consider A “Personal” CRM Customer Relationship Management (“CRM”) systems are used by most businesses and you likely have one available through the DMS at the dealership where you work. CRMs help you to organize your contacts, document conversations, create follow up tasks, and multiple other functions. Their core design is for supporting sales, marketing and customer service operations. But they can also be terrific tools for building trust and deepening relationships with your customers. And in this new environment, customers will remember who was there to help them – and who wasn’t. Some of you may know of the “big boys” like Salesforce, NetSuite and Microsoft Dynamics. Frankly, you don’t need all the higher-end features that come with big applications like these. Thankfully, there are many other simpler alternatives that are easy to set up and maintain. Some Good Options Every CRM will require some degree of set up and a learning curve. However, several are intuitive and are designed to be set up and be fully functional within a couple of hours. Virtually all of them have a decent mobile application as well, which allows you to have 24 / 7 access to your customer information. Several are free forever or on a trial basis. If you want a little more bang from the application, the paid subscription rates are often reasonable too. There are a lot of good places to look for the “right” CRM. When I am evaluating tools like this, I always look to certain information sources like Capterra and some other information sources (like this one). Some of My Favorites Insightly – This is a pretty complete and simple package that’s easy to implement. They do a pretty job with “hiding” the free version, but it’s there at the bottom of the Pricing page of their site. Streak – If you are using Google’s Gmail, this is a great option as well. The basic package is very adequate for staying on top of your business pipeline(s) and it integrates well with your Gmail for doing targeted & personalized mailings to your customers. Agile CRM – This is very adequate package and offers some useful features like a landing page builder for having a web presence. There are several other good choices as well, so take some time to investigate what is available. Also, consider keeping this practice alive after you go back to work – it’s likely that you’ll need to be working differently anyway, right? So go for it – your customers will appreciate it!
0 What is a business manager, finance manager, or F&I manager?
What is a Business Manager, Finance Manager or F&I Manager???? by: Jeremiah Shelton I get the privilege of meeting many new F&I Manager’s every month. I meet some of these hard-working people in current accounts I work with, in new accounts, or one of our training classes or seminars. The funny thing is all of them have the same title but none of them perform the job the same way. Most F&I Managers were great Auto Sales Professionals but, were never properly trained to sell insurance or how to manage the F&I Department. Most just get “thrown into the box” and have no idea what they are really doing. They are forced to rely on the instincts that got them there in the first place. Those that are lucky enough to get any training are usually trained by the current Manager (who is leaving for another job) or another Manager who hasn’t been properly trained either. Fewer still may get training from their product provider or their Factory representative and typically this training is primarily product knowledge and how to print a menu. The top 1% or what I call “F&I Professionals” are fortunate enough to have been surrounded by people who inspired them to become great leaders. There are 6 types of F&I Managers and you can decide who you want to be. Type 1 – “The Paperwork Person” Having clean paperwork and a clean CIT list is one of MANY critical responsibilities of F&I. Unfortunately, I have seen paperwork become an excuse and shield for subpar F&I results. Type 1 Paperwork People are rarely found outside the walls of their office and prefer the sales force review menus prior to a customer signing paperwork. Type 1 Paperwork People are not F&I Manager’s, they are Paperwork Manager’s. Type 1 Paperwork People will be replaced by technology within the next 10 years. Type 2 – “The Salesperson” If I had to guess I would assume that 70% of the F&I managers I have met fall into this category. These folks have relatively clean paperwork and are average producers when it comes to F&I results. These are the people who would benefit the most from PROPER training. The Type 2 Salesperson will come to work and get the job done keeping to themselves and only focusing on closing deals and selling products (typically selling 1 product very well). Type 2 people are great salespeople, but they are not managers. Type 3 – “CSI Killer” Type 3 CSI Killers makes my skin crawl. This is the type that causes some of the problems in our industry and why customers have trust issues with Auto Dealer’s. When the Type 3 CSI Killer is in F&I, the F&I office becomes the place where greed takes over and ethics go to die. The Type 3 CSI Killer is the person that works the Sales Manager / Desk more than anyone else. This manager will desk everything in a beneficial way for his/her pay plan and magically make products fit into the customers quoted payment. Manipulation for the sole purpose of greed is not selling!! Some of the worst offenders of this category will even sell low end products when higher level coverages are available. This type of person only works for themselves and is only concerned with their paycheck. This person WILL send your chargebacks through the roof, destroy your CSI, and damage your store’s culture. This person should not be in our business. Type 4 – “F&I Manager” Now we can officially use the “Manager” title. This Manager does a great job producing income and has clean paperwork. They also work and hold meetings with all the managers in the dealership. They will conduct “save a deal” meetings with their sales team every morning to discuss the good, bad, and ugly specific to the deliveries that happened the day before. The Type 4 F&I manager will build a game plan for the days deliveries before the meeting adjourns. On a weekly basis this manager will hold a meeting with the sales team to update them with new information regarding the F&I department. This manager will always look for a way to increase profit and CSI for the dealership. If you or your F&I Manager fall into this category: Great job! Type 5 – “F&I Manager/Trainer” This manager does everything a Type 4 F&I Manager does but adds training. These managers will train your salespeople on the road to the sale. They will train your service advisors how to sell more VSC’s out of service. They will train your sales managers how to desk deals. They will have a productive working relationship with all your banks, product providers, state associations and your factory. These people are a gift to the store and are extremely hard to replace. In my 20-year career I would put these managers in the top 1%. Type 6 – “F&I Professional” If we were playing football, these managers would all be in the NFL. These professionals do everything Type 4 and 5 will do but they approach the entire job differently. F&I Professionals inspire and lead everyone around them. F&I Professionals do their job with purpose and are laser focused on what they will achieve. F&I Professionals change the culture of the entire business and are loved by everyone who works there. This is the magical F&I Professional and yes... they do exist. We all may have the same title but, that sure as heck doesn’t mean we are all the same. Decide who you want to be!! Join us on our F&I Fuel Facebook page to be a part of the discussion: https://www.facebook.com/groups/1018124165249472/
Think and be Thankful By: Adam Yoder I’m headed into my 13th year in the car business. I’ve spent about 9 years on the retail side, and almost 4 on the F&I training side. I haven’t been detached from retail long enough to forget what you guys go through every day… being in automotive retail is not for the faint of heart but rather for those with thick skin if you ask me. You work with a lot of different personalities with some giant egos, you put in the hours like no other, (except for maybe restaurant owners) and you go from zero to hero, and then hero back to zero 30 days at a time. Hopefully, you’re able to squeeze a vacation in there somewhere, even if that vacation takes place in the comfort of your living room (which is also a great time to lose your phone for the week). You are all warriors battling on the front lines. The best part about it, there is real purpose and significance behind all you do. Because of what you do, your customers can provide a living and support their family. Your customers have reliable transportation to get to work every day. You help people succeed, and when you stop and think about it, that is nothing to take lightly and is very rewarding and commendable. Job well done my fellow F&I friends. Great speech, right? Thank you. Now I’m sure your all thinking, ok lets get back to the real world because every day is a grind, I’m not hitting my comp goals, everyone is focused on giving cars away and hitting the number while I’m left here in F&I trying to take a loser deal from red to black. Again, I’m not that far detached from retail I remember what it can be like. The good news is, you aren’t the only one feeling that way. In fact, throughout the course of history there are thousands upon thousands of managers who have felt and experienced those same feelings. There is nothing new under the sun with all the circumstances you face in F&I. Speaking from experience as a trainer and with a company who works with hundreds of stores, from small independents to large dealer groups, we can give you a lot of answers on how to address your specific challenges. From presentation to objection handling, understanding personalities and how people listen and learn, to managing your department and training sales people, there is an endless amount of information we have available that will help you grow and make more money in your department. However, that can come later at your request. For now, I want to give you something you can immediately put in to practice and experience an immediate difference. Here it is and don’t let the words stop you from finishing this article- practicing gratitude. Can I really convince you that gratitude will solve all your problems? No, and it doesn’t. But what gratitude can do for you will change your world if you agree to change the way you think. It’s the one thing you can control that noone can take from you, and you can focus on it any time of the day, 24/7. Having gratitude is almost like a multi vitamin… when you have it daily you almost forget you are taking it, because you’ve been taking it for so long you stop noticing what it’s been doing for you. Its when you stop taking it that you start to feel the negative effects, and you quickly get back on it. Researchers from the University of Harvard found that gratitude helps people feel more positive emotions, relish good experiences, release toxic emotions, give you better physical and mental health, helps you cope with adversity, and gives you stronger relationships and higher energy levels. It removes toxic emotions and gives us joy in our lives. So you might be thinking well that’s great but I’m not buying it the whole “change your attitude” speech, I’ve heard it a million times and I don’t need your self help advice. That’s ok, this article is for those of you who want the best for yourselves and those around you and embrace the opportunities to get better at your craft, every day. Your attitude plays a big part of your success in F&I. There was an article written by Daily Health titled: “Neuroscience Reveals: Gratitude literally rewires your brain to be happier.” Look up the article, it’s worth the read. I’ll leave you with this question you can ask yourself- What do you spend most of your time thinking about throughout the day? Think and be thankful. Here’s something you can do today to start your never-ending journey of practicing gratitude. I stole this from our VP of Training and Development- Jeremiah Shelton: write down four things your grateful for on a piece of paper, and put it somewhere that you can see it first thing in the morning right after you wake up. Read them and add to that list every day. If you do, before you know it, you will have pages of things your grateful for and there is no better way to start your day then flooding your mind with things your grateful for. If your thinking about those things, it becomes literally impossible for you to be unhappy and that is the attitude your coworkers and customers need in the showroom. All the best my F&I friends. Join us on our F&I Fuel Facebook page to be a part of the discussion: https://www.facebook.com/groups/1018124165249472/
0 GAP: Why it is a great value in 2020
GAP is on sale! by: Rob Volatile To understand what has taken place with GAP products nationally since 2015, you need to have a basic understanding of insurance. Insurance on its face is simply math based on the rule of large numbers. Actuarial folks are tasked with risk assessment based on all available data. Once the information has been examined, a pure insurance rate is calculated to cover the specific risk. After that the administrator establishes a per contract fee for legal insurance filings, risk management, claims administration and a myriad of other expenses. Once concluded (in the case of GAP) a “dealer rate” is established. There is no such thing as a bad risk…just a bad rate. Starting around 2015 many factors converged to create an environment where GAP losses began to accelerate. Up until that point, GAP losses had hovered at about the same number for years. Here is a list of SOME of the factors that created the accelerated losses on GAP protection: Increased finance terms Increased insurance “total losses” due to technology increasing the cost of repair Acts of God: floods / storms / etc Adverse selection: Selling GAP to the people that need it most instead of offering it to all customers Used vehicle price fluctuations And on and on These factors created loss ratios that sometimes eclipsed 300%. A loss ratio is the number insurance companies used to measure the outcome of the original risk assessment. A simple way to understand loss ratio is based on $1: If $1 in insurance reserve is taken in and 60 cents is paid in claims the loss ratio would be 60% If $1 in insurance reserve is taken in and $1.50 is paid in claims the loss ratio would be 150% Obviously, the goal of any insurance company is to do their best to keep the loss ratio below 100%. Remember that insurance companies make money on “the float”. The float is the investment of insurance reserve while it is waiting to pay a claim. This is how Warren Buffet made his fortune. How is GAP on sale? Basic math would tell you that if the money paid in claims is more than the money taken in by the insurance company then the customers are getting more than their dollars are worth. This is exactly the scenario that has and is currently taking place with GAP. So in conclusion, GAP is actually on sale since it will pay more on average in claims than the customer is paying in pure insurance premium. Join us on our F&I Fuel Facebook page to be a part of the discussion: https://www.facebook.com/groups/1018124165249472/
0 In the news: Strategic Diversified Offers Coronavirus Disinfectant that Cleans a Vehicle for About One Cent
(WEST CHESTER, Pa. May 11, 2020) — Helping their clients and doing what is right for the automotive retail industry has exploded into a full-blown mission for the team at Strategic Diversified, a West Chester, Pa.-based F&I consultancy, as they are now providing a coronavirus disinfectant that will disinfect a car or truck, without doing any damage to a vehicle’s interior, for just over a penny, and is offering the product — at their cost. Rob Volatile, CEO of Strategic Diversified has more than 30 years of experience in the industry, and said when Covid-19 lockdowns began he quickly understood the ramifications for automotive retailers still able sell and service vehicles during the pandemic and afterwards. “Every provider of F&I products and services has some type of cleaning or chemical-related treatments it offers to consumers,” he said. “We began to see companies popping up all over the Internet offering dealers products that would disinfect vehicles.” Product costs, Volatile said, were all over the place. Some claimed their could clean a vehicle with a product that would cost a $1, while others claimed their product would disinfect a vehicle for $50, and all price points in between. “With business being slow, we formed a committee in-house and began looking at the products to determine their efficacy and value from a cost standpoint,” Volatile said. It was the math that drove the effort. Volatile said the average dealership selling 200 units a month will provide 600 test drives and perform 800 ROs a month. “Because dealers would have to disinfect a vehicle after every oil change and after every test drive to ensure the safety of their employees and customers,” Volatile said, “you can quickly see that at $10 a car, $14,000 a month would become a new fixed cost that dealers would be unable to pass along to anyone.” Volatile made a call to an old friend in California he had worked with a decade ago whose company, Granitize, manufactures and distributes a variety of chemical products, including a EPA registered disinfectant called Sani-Quat. This product, which kills 99.9 percent of all viruses and bacteria, but does not harm the plastics, hard surfaces, chrome, leather, upholstery, comes in gallons of concentrate and is added to water. “Because it is concentrated, one gallon of the product can disinfect about 12,000 vehicles,” Volatile said. “The product must be ordered in four-gallon increments for $144 plus shipping costs. This leaves plenty of Sani-Quat to clean the dealership’s facilities.” The product is used by many Big Box retailers who use pressurized sprayers to disinfect their facilities overnight, Volatile noted. “Dealers should consider the marketing and advertising benefits as well,” Volatile noted. “Not only can they say every vehicle is disinfected as it enters and leaves the facility alleviating the concerns of consumers, they can donate a gallon to churches, community organizations, first responders or become a disinfectant location for other businesses like Uber drivers, limousine services, or delivery services. The list is really endless when you really get to thinking about it.” Volatile said he’s been asked why he’s offering the service at cost, rather than profiting off of what is bound to be a product with high-volume sales. “It’s not right to try to profit off a pandemic,” Volatile said. “We were very disappointed by what we considered price gouging, especially from our competitors in the marketplace. Yes, we only make money when our dealer clients sell vehicles and our products, so we have a vested interest in their success. In our view, however, providing the product that isn’t readily available to dealers except through a distributor will help everyone in the industry. It’s at times like this that you find out who people truly are by their actions. We feel we’ve acted in the best interests of our industry.” For more information on how to order the product, visit Strategic Diversified’s website, strategicdiversified.com. Information about Sani-Quat and how to order it will be front and center. You can reach Strategic Diversified by call (800) 708-2227. Join us on our F&I Fuel Facebook page to be a part of the discussion: https://www.facebook.com/groups/1018124165249472/
Overcoming Objections – GAP By: Adam Yoder “I get GAP insurance through my insurance company for half the price of yours.” Have you ever had a customer say this to you? Most likely you have, and your initial feeling was probably frustration because you know the insurance companies GAP is not as good as your GAP! You get what you pay for and there are several reasons the customer should go with your GAP. This is another instance where the customer needs someone to slow them down and consult with them to educate them on the differences between the two GAP products. Here are four things you can convey to your customer to help educate them on product differences: If you have GAP through your insurance company and you shop your insurance bundle i.e. Home, Auto, Life, etc. and you find a better deal and make the switch, you will lose your GAP coverage immediately and are not able to purchase it after the sale. If you have GAP through your insurance company and you have a car accident and your car is totaled, you will have a double claim. One claim for the accident, and a second claim for the GAP insurance, which typically results in your monthly premium going up. Most GAP policies through insurance companies only pay out 115% loan to value, compared to 150% loan to value with our GAP. The last thing any customer needs to experience is going the trauma of a total loss, thinking the GAP from their insurance company will allow them to walk away from the car and loan free and clear, only to find out the GAP didn’t completely satisfy the loan. However, at 150% with our GAP, the loan will be satisfied. Most GAP policies through insurance companies will not cover any negative equity from a prior loan that is rolled into the new loan. This defeats the purpose of GAP insurance! Educate your customer by reviewing these four points. Chances are the customer did not have this information and had not thought about any of these concerns. After reviewing these points, continue as follows: “Most of our customers take our GAP to avoid everything we just talked about, even though it costs more than GAP through their insurance company. But here is what we can do for you: come back to the dealership when your about halfway through your loan, and we will do an appraisal on your car to determine the value at that time. GAP is needed most when you are exposed to negative equity, and typically once you are halfway through your loan your car is worth what you owe the bank, and you no longer need GAP. If that’s the case, we will cancel your GAP and you will get a refund for the portion (half) you didn’t use, which means you will have paid what you would have for your insurance company GAP but you get the better product and can avoid those four concerns.” Do we want the customer to cancel GAP and create a chargeback? Not really. However, we do want the customer to have the better product to protect them. Our goal is first and foremost to do all we can to ensure our customers are happy and taken care of. One way or the other, this philosophy will result in future sales and loyal customers: And that’s what its all about! Join us on our F&I Fuel Facebook page to be a part of the discussion: https://www.facebook.com/groups/1018124165249472/
0 $8,000 flipped and won’t buy Gap
$8,000 flipped and won’t buy Gap by: Jeremiah Shelton I have worked with thousands of F&I Managers and Sales professionals in my career. I have flown all over the country to provide training to my clients and I am constantly looking for new material to share. One common complaint that I see with F&I managers is the shock they face, when they have a customer who will not purchase Gap when they are rolling a negative balance and not putting any money down on their new vehicle. I see F&I Managers complaining and begging their customers to take Gap because the F&I Manager understands how important the product is. I have even seen some Managers get so upset that their customer did not purchase Gap, that they actually wish for the customer to total their vehicle so the customer can learn his/her lesson. Are our ego’s so big that we blame the customer for not purchasing what we pitched them??? STOP BLAMING YOUR CUSTOMER AND LOOK IN THE MIRROR!!! It is not the customers fault for not understanding our business. It is the F&I Manager’s job to properly explain why each program is needed. If a customer does not purchase a product from you…. You didn’t explain it correctly. Let’s take a look at your presentation. Are you using your menu as a presentation or a math tool. If you are using the menu to present all of your programs without any explanation of what you are doing, you are making a huge mistake. Half of your customers are not listening to your presentation and the other half is confused because they are not in the car business. You need to slow down to speed up. The best producers have a conversation with their customers explaining some of the exposures the customer can have prior to going into the menu. Take time to explain to your customers what could happen before you start selling products. When your customers understand what could happen, they will buy your programs. Now look at Gap. Most trainers teach F&I Managers to ask their customer, “Do you know what gap insurance is”. This is the worst question you can ask as an F&I manager because most customers will lie and say yes because they don’t want to look like they don’t understand something. After the customer replies “yes” the F&I manager will say something like this…. Gap insurance will cover the difference between what the insurance company gives you and what you owe the bank so you can come back and buy another vehicle. To the F&I manager this makes complete sense because that is what the product does. The problem is that your customer thinks that you are trying to sell them auto insurance and the customers objection is, “I have insurance”. At this point you have completely lost your customer and you are at the point of no return when you try to explain it to them. They aren’t buying Gap because YOU EXPLAINED IT WRONG!! Change your stance and reverse the way that you explain it. Instead of asking “do you know what Gap is” change it to “Do you know how a total loss is handled with insurance companies”. You can explain how the insurance industry works when you have a total loss. You can explain that if their vehicle gets totaled whether it’s the customers fault or not, the insurance company will have an adjuster appraise their vehicle and figure out if they are going to fix the vehicle or total it. If the adjuster decides to total the vehicle and value it at $20,000.00 but the customer owes $30,000.00 to the bank, that’s the problem. Once your customer understands this, they will purchase Gap. Its all in the way you present your ideas. Next time your customer doesn’t purchase gap when they roll in $8,000.00 of negative equity, don’t blame the customer and look at yourself. You and your customer DESERVE to have the best presentation. Join us on our F&I Fuel Facebook page to be a part of the discussion: https://www.facebook.com/groups/1018124165249472/
0 The news of our demise has been greatly exaggerated…
The news of our demise has been greatly exaggerated… By: Rob Volatile I am writing this as it appears: One man’s interpretation of the current data as it applies to the retail automotive industry. Nothing more, nothing less. In my 30 years in the business I have seen and been involved in a lot of things. I have seen markets collapse and rebuild. I have seen recessions, a great recession, and I lived through 9/11. The current pandemic is certainly as major an event as anything I have seen and will be evaluated and referred to from this point on. I would like to take the time to discuss the business aspect of the pandemic playing out and what I believe will take place in both the short and long term…and its not all doom and gloom. The Data: Thus far I have contacted 4 major national administrators to determine their production drop off in April 2020. This is based on data from the sale of F&I products so these numbers are not based on volume of vehicle sales, rather results of F&I. I am not a scientist and this information not pure but it tells a story that is worth looking into. Here is what I found: The April 2020 national market was around 53% of April 2020 Southeast was 69% Northeast was 42% Northwest was 52% Southwest was 54% Obviously in areas where the pandemic was the hottest, the numbers were much worse than less affected areas. In certain states (Pa.) dealers were forbidden to sell cars for the better part of 5 weeks with the threat of their licenses being revoked. The rest of the Northeast has been crushed as the numbers indicate and as you move south past northern Va, the numbers steadily improve to as high as 80% in the Carolinas. In other words, your location plays a major factor in your current production. So, in the worst-case scenario at the height of pandemic vigilance (April 2020) the floor for production was around 40%. Obviously, the floor is an unsustainable number, but it is a data point for an expected low end and that is important vs. modeling that does not involve context or flexibility. In other words, data suggests we should move higher from here minus any relapses in shutdowns. Digital Retailing: If you are looking for a one size fits all solution to convert your dealership into an online digital retail platform, please stop. There is no silver bullet or magic software solution that can be plugged in and turn you into an online retailer. Sure, there are some nice programs out there to assist you in your journey like Roadster or AutoFi, but do not mistake them for all-in-one programs that allow a full digital transaction. The truth is that most dealers will adopt a hybrid scenario that allows for some parts of the sale and transaction to be conducted without the customer present. There is a HUGE difference between this hybrid scenario and digital retailing. As a dealer you need to understand this clearly before moving to a solution. Also, digital retailing is a cultural construct that most dealers are not ready for within the framework of their total operation. This isn’t bad news, its just an honest look at the situation from an outside perspective. But don’t worry: The hybrid scenario is actually AWESOME FOR EVERYONE!!! Happy Customers: The Ultimate goal Customers biggest complaint about the car buying experience is the time it takes to actually purchase a vehicle. This is a fair and accurate complaint, but the customer is forgetting that they are part of the “time” problem. Customers do not like to haggle (until they do) and the standard “road to the sale” process used by most dealers is not explained correctly and causes confusion which leads to distrust. Allowing the customer to shop online, come to terms on the phone or camera to camera, and take delivery at their home is a terrific solution in this moment and should be carried forward beyond the pandemic as one of a few options of purchasing from a dealership. The primary reason is that a customer’s happiness leads to loyalty and long-term profitability. This assumes that the dealership has a bullet proof F&I process that ensures a camera to camera explanation of available financing and protection options before the physical delivery takes place offsite. We have had TERRIFIC RESULTS with this specific process mainly because the customer is comfortable, allows the time we need to discuss options, and is willing to listen. F&I PVRs have risen to pre pandemic levels and in some cases exceeded the numbers and it has everything to do with making sure the customer is comfortable and happy. I call that a WIN! This might just be the answer: The question that has been asked for many years is: “How do we compensate salespeople in an environment where the profitability on the front end of a new car sale is often very little?” Consider this hybrid sales scenario from an overhead and workload point of view for a moment: If a customer is willing to do much of the transaction online and is willing to schedule specific times for F&I review and ultimate delivery, how much time has been saved? Is it feasible that good salesperson / consultant could handle twice the number of sales in this scenario vs. the pre-pandemic model? If so, how much more consistent could the dealership be? How much could a dealer save in overhead with a reduced / better salesforce he or she had pre-pandemic? This is a MUCH HEALTHIER scenario for any dealer if it comes to fruition and us, as a business force it to become a reality. We could focus training on far less people and pay them more money which would greatly curtail turnover. Our social expense in employees would dramatically reduce. Our Salespeople would become a group of sales managers and our customers would be better taken care of and happier. The positives are massive for the dealer and the customer. Talk about a win-win!!! Conclusion: Will the next few months into next year be bumpy? Of course, it will. There are going to be a lot of factors involved in getting the economy back to some sense of normalcy. But change is never a bad thing, its uncomfortable but necessary for growth. The idea of “disruptors” is nothing more than a new age way to describe change and new ideas. Not every change is a threat and not every disruptor is a harbinger of things to come. I truly believe that we are about to reinvent the retail automotive franchise landscape in multiple ways that ways that are better for everyone involved. We have nothing to fear from hybrid digital retailing if we truly understand where we will end up and move in that direction quickly. This will be the “new normal” if everyone understands and embraces it. I for one am gearing up all of our development and training activity to fully embrace this scenario and help my partners succeed and exceed their previous records. Imagine a world where the customer gets to choose from friendly sales process models on how to buy a car from a dealer. We will still sell vehicles as we did in the past when this situation is behind us but it will be the customer’s choice to do so. Each choice is a different process and in the end the dealer is made more capable by these customer choices. Overhead is reduced, quality people are paid more, customers are happier and more loyal, and profitability is increased overall. It can happen…and I know WE can make it happen. Stay Safe! Join us on our F&I Fuel Facebook page to be a part of the discussion: https://www.facebook.com/groups/1018124165249472/
0 Pennsylvania Dealer Transaction Guidelines
GUIDANCE FOR VEHICLE TRANSACTIONS DURING THE COVID-19 DISASTER EMERGENCY TO ENSURE THE SAFETY AND HEALTH OF EMPLOYEES AND THE PUBLIC INTENT: Under the Governor’s and Secretary of Health’s orders regarding the “Closure of All Businesses That Are Not Life Sustaining,” amended as of April 20, 2020, online vehicle sales are authorized to commence statewide in accordance with this guidance. Automobile and other motor vehicle dealers were not permitted to continue physical operations under the Governor’s and Secretary of Health’s March 19, 2020, Business Closure Orders. Dealers generally could not complete “online” or internet-based sales as the vehicle buying process traditionally requires certain in-person interactions, often with multiple individuals and live notarization. Senate Bill 841, which was signed into law by the Governor on April 20, 2020, allows for, among other things, remote notarization. Additionally, the administration recently updated its guidance regarding notaries to clarify that notaries who offer services in a business location that is authorized to maintain in-person operations under closure orders (such as banks and other depository financial institutions) may continue to offer in-person services at those locations. The legalization of remote notarization along with a recognition that many notaries can continue physical operations will allow certain licensed dealers the latitude to conduct virtual vehicle sales that comport with Pennsylvania’s COVID-19 mitigation efforts. Motor vehicle dealers with a valid, current license from the Pennsylvania Department of State’s Board of Vehicle Manufacturers, Dealers, and Salespersons who participate in the Pennsylvania Department of Transportation’s Online Registration Program (OLRP). It is the policy of the Administration to ensure that all businesses subject to this guidance conduct operations in the manner best designed to prevent or mitigate the spread of COVID-19 and ensure the safety of the employers, employees and the public whom they serve or work alongside. All dealers authorized to operate under this guidance should complete all elements of the vehicle transaction as follows: Dealers should direct customers to shop online at dealer websites and contact the dealer electronically (by phone, email, text message, etc.). All transaction terms must be discussed and agreed-to between the dealer and customer electronically. No in-person viewing of vehicles is authorized under this guidance. If financing is required, electronic application for financing should be made by the customer directly to the financial institution or electronically through the Insurance verification and coverage must also be done The dealer must prepare all necessary transaction documents (including any trade- in related documents) and send them to the customer electronically or by The dealer should email or mail a limited power of attorney to the customer and, either through remote notarization or working with a notary authorized to continue in-person operations, notarize the customer’s The dealer would then use the limited power of attorney to execute documents on behalf of the customer as Remote notarization or a notary authorized to continue in-person operations should then be used to complete the assignment of the title. The dealer should overnight mail the MCO/Title to the customer, who should use remote notarization or utilize a notary authorized to continue physical operations when signing the odometer disclosure section. The document is then sent back to the IMPORTANT: While the above described process may vary given situational differences from transaction to transaction, most transactions should follow this model. Moreover, it is imperative that dealers follow these steps to eliminate all in-person contact with the customer in the transaction prior to vehicle handoff. The dealer and customer should schedule an appointment for one customer at a time to pick up the purchased vehicle, and drop off any trade-in. The vehicle handoff should be limited to the least number of people required to complete the transaction. Dealers may also schedule a drop off at the buyer’s The dealer will conduct all deliveries and interactions either outside physical buildings, in a service bay cleaned according to guidelines from the Pennsylvania Department of Health (DOH) or the Centers for Disease Control and Prevention (CDC), or in a designated room cleaned according to DOH/CDC guidelines. To the extent that there is a conflict in cleaning guidance, dealers should follow the most recent DOH order or All authorized dealers must adhere to the Guidance For Businesses Permitted To Operate During The Covid-19 Disaster Emergency To Ensure The Safety And Health Of Employees And The Public during any vehicle transfer Specific Information for authorized dealers: To effectuate virtual vehicle sales, the dealer will function as both the seller and the agent. As the seller, the dealer sells the vehicle, discloses the odometer information, and signs as seller. As the agent, an authorized employee of the dealer usually called the title clerk completes the motor vehicle paperwork on behalf of PennDOT and also notarizes or verifies, in lieu of notarization, the seller’s and buyer’s signatures. PennDOT has identified the following best practice steps for dealers to complete virtual vehicle sales: Pre-Verification: Identification: Agent must validate the identity of the seller and buyer. For the buyer, the only acceptable proof of identification for the purposes of titling and registering a vehicle in Pennsylvania are: a valid Pennsylvania Photo Driver’s License; a valid Pennsylvania Photo Identification Card; a valid Pennsylvania Photo Exempt Driver’s License; a valid Pennsylvania Photo Exempt Identification Card; or a valid U.S. Armed Forces Common Access While identification can be pre-verified via virtual methods and a copy should be provided by the buyer, seller should verify identification documents during the vehicle transfer The seller needs to have a government-issued photo Note: Individuals negotiating a transaction with virtual buyers must be able to present proof of affiliation with the authorized Insurance: Agent must validate the buyer has current vehicle liability Transfer of Ownership Agent completes transfer of ownership on the proof of ownership document - Title or Manufacturer Certificate/Statement of Origin (MCO or MSO) - by recording the buyer’s name and address in the appropriates Agent records odometer information as disclosed by the seller in the appropriate space. Seller handprints their name and then signs in the appropriate Seller’s signature can be acknowledged in the appropriate space via remote notarization, by a notary authorized to continue physical operations or agent can verify in lieu of notarization if applicable. Seller transmits all documents requiring buyer’s wet signature, if necessary, to buyer. Buyer handprints name and signs in appropriate space in presence of remote notary or a notary authorized to continue physical Buyer returns document to Alternatively, if buyer has executed proper limited or secure power of attorney such that it would allow the dealer to affix all necessary signatures to all document, no document transfer is Please note that this process must produce a physical odometer disclosure document as per 75 Pa. C.S. §§ 7134, For dealers participating in the OLRP, PennDOT authorized agents for titling are still required to comply with their Agent Services Contract and the Online Registration Program requirements. This includes the completion of the transfer of ownership on the proof of ownership document, the title application process, and the submission of the title application. Other Processes Questions and Further Guidance: Businesses that have questions about remote notarization should review the Department of State’s Electronic/Remote Notarization webpage. Businesses that have questions about vehicle title issues should review the Department of Transportation’s Buying or Selling A Vehicle webpage. Enforcement: Enforcement actions will be taken against motor vehicle dealers that are not in compliance with the Governor’s and Secretary of Health’s orders regarding the “Closure of All Businesses That Are Not Life Sustaining Orders,” as amended, or not in compliance with this guidance. Additional Information: For the most up-to-date, reliable information, please continue to refer to the Commonwealth of Pennsylvania’s website for Responding to COVID-19 in Pennsylvania: https://www.pa.gov/guides/responding-to-covid-19/. Join us on our F&I Fuel Facebook page to be a part of the discussion: https://www.facebook.com/groups/1018124165249472/