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Best Kept Secrets of a Profitable F&I Department

Anyone who has been a part of a successful F&I operation, your thoughts would be GREATLY APPRECIATED. I think this is a discussion that all of us can benefit on. What secrets have you found work?

Here are a few moves we are thinking of making after studying this topic. Any shared opinions are greatly appreciated:

1. Sales Pay Plans - Right now sales people get spiffed about $30 for a service contract sold, for example. We are thinking of beefing this up to about $100 to motivate them to talk more about the VSC and possibly even a spiff for other products as well.

2. Marketing materials. We are in talks right now with EasyCare and AllState (we currently use Zurich). We would like to make our own marketing materials and possibly brand the products as DevyCare, etc (if the companies allow us). We would put these marketing materials on the showroom floor to build value and plant the seed for the customer.

2a. Putting this newly branded material on our website.

Curious as to what you think of these ideas and if you have any of your own.


Feb 26, 2013

Our salesman get the same percentage of front end gross on back end gross. Salesman have more incentive to make sure we capture finance (rather than local credit union or cash deal), and they can begin to soft sell some of the products before finance. Not sure how common this is, but with the front end profits on new vehicles on the decline, we all need to capture finance!

Feb 28, 2013

Hi Craig. Thanks for the input. How long have you been doing that? Did you see an improvement when you started doing that?

Feb 28, 2013

Steve, we have been doing it for over 10 years. It wasn't fair to watch a salesman work a customer over 4-5 visits, take a mini, then watch the finance manager and sales manager celebrate with a big back end deal. We reduced their front end commission % considerably, and the commission on the front and back end is the same %. Works really well, creates a team atmosphere from sales to finance, and should also increase your finance penetration and your finance product penetration.

Feb 28, 2013

Steve, I have seen an increase in desire for sales involvement and appreciation for the products and services that are offered in F&I with changing payplans and good training on benefits. I have mixed feelings on Dealership branding of the products.

As far as payplans are considered, I have had success with adding a percentage of gross profit on backend much like Craig stated. I have not reduced front end percentages when doing this but depending on the percentage that is currently in the payplan it may be a topic of review. First and foremost is getting them trained on what the benifits are and knowing what the word tracks are to set up finance effectively. And even more importantly, when to leave the expertise to the product experts. Salespeople will inherently say too much and dig a hole if not cautioned about killing the efforts of finance.

Training Training Training.... But good Training.


Mar 1, 2013

Thanks a lot guys... I see what you are saying... Good training! What about the brand of the service contract & products?

Anyone out there that does $900 + per copy on used? I want to know how you got there specifically. What brand contract did you use? Who trained you? Who got trained? How was everyone compensated. Please help!>

Thanks :)

Mar 3, 2013


To answer your questions in line:
1) I always used the branding of the service contract provider ( The Warranty Group " Q-certified" and Continental Warranties "Gold Coverage")
2) In my experience, used per copy was always $1,100 - $1,300.
- my revenue was more product saturation than rate mark-up.
- VSC, Gap, Tire & wheel, roadside asst.
When with The Warranty Group - I went through there 2 week training in Chicago. I then did in-house training for the sales reps.
3) Sales force was compensated with a 7% of gross prifit on backend in addition to there 20-25% front end.

I hope this helps


Mar 4, 2013

When I was in F/I, I had a manager beat me over the head with "Offer 100% of your Customers, 100% of your products, 100% of the time". I carrired a 62% Import and 71% Domestice warranty penitration. I dont know if it is helpful, but I also had several props, like window motors and ECM type computer modules. Follow up on those who did not take advantage of the warranty can be helpful also.

Mar 4, 2013

We did 2 things that really assisted us in assuring that the sales consultants participated in endorsing the back-end. #1 Sales consultants were paid on anything sold in F&I. The belief is that the sales dept gave the F&I dept the opportunity in the first place by selling the car. #2 We had a bonus board that tracked performance in certain categories such as aged units, CSI, Gross avg, and F&I. Worked like a charm. The sales consultants tried to make the F&I guys their best friend!

Apr 3, 2013

I wanted to introduce myself; I am Susan Hamilton, Vice President of Nusani Media. I am partnered with Equifax and also a lender...I run a very smooth operation and I must say, finance managers love my program...With my program we follow all rules and regulation of state guidelines to bring you a very unique product that will move no less than 20 units to where I have seen over 48 units per month with a high copy per unit. IT WORKS EVERY TIME. I have dealers that have been running with me for a solid 24 months and wouldn't miss a month. Why? Well for example; Chuck Tieche GM of Kia of Alliance moved 13 units last week off of my program that had just hit within 3 days. The month before this he made $92,000 profit off of my program and he will tell you in his summer months he was nearing $130,000 profit...THAT IS PROFIT! After they paid me! He came to this dealership with determination to turn it around from being what the owners thought "TOO FAR GONE" he is now on top leaving his partnering stores asking what the heck is he doing!? This store has now been given the "OKAY" to expand! The owner would have never thought his Kia store that was ready to shut the doors would now be breaking ground to build a much larger Kia store with Factory Kia lending a hand for support! With this being said, I run this program with 3 of his partnering stores as well. Summit Toyota also reported to me last week their first 2 appointments I sent to them, they made $11K profit on...

It would only make sense to at least hear about my product. I give exclusivity over your area as well.

Apr 17, 2013

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