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Jim Leman

Jim Leman Writing about dealer operations

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Master the 5 F&I Metrics that Matter Most

By Jim Maxim, Jr.

I want to present here five F&I performance calculations that if you regularly work them and respond appropriately your F&I department will produce more profit. First, all business and industries when measuring performance or production use metrics called Key Performance Indicators (KPI). 

We will look at five F&I metrics considered the top five KPI’s in the F&I industry. KPIs reveal how you’re doing – and help identify any issues or problems to address. Since money is involved here, tracking and measuring these KPIs should be mastered by every dealer and F&I manager.

Healthy F&I departments and their managers work at mastering each of these metrics:

1.PVR is Profit per Vehicle Retail in dollars. This calculation is Total Dollars Profit = Finance Reserve + F&I Product Income ÷ by Total Units Sold

PVR is the most popular F&I metric and KPI. Most experts in the F&I industry would agree that PVR is King and is the most common metric referred to in measuring F&I performance.  The goal and objective are for F&I to achieve higher PVR.

How to improve PVR: Given today’s downward pressure on financial reserve, hope for improved PVR rests on the F&I manager’s F&I product sales penetration. Consumer buying behaviors have changed over the years. With consumers owning and keeping vehicles longer, many protection products now offer more value to them. Consider training the F&I team about these changing consumer buying behaviors and how they change customer wants and needs. 

F&I managers must change how they present F&I products, so product value is evident in the buyers’ minds.  Perhaps the most powerful tool F&I managers are using today that helps increase PVR is an F&I menu presentation system.  In 2015, MaximTrak did a survey of dealers using its e-menu technology that showed the digital platform responsible for per-vehicle retail (PVR) lifts of $538 and 52% product penetration lifts. 

2.Individual F&I Product Sales Penetration (%) is the # of F&I Product Sold ÷ Total # Vehicle Units Sold. For example: 60 VSC Sold ÷ 100 Units = 60%.


  • Vehicle Service Contract - most popular of all F&I products
  • VSC – most profitable in dollars
    - impacts other departments in the store like parts and service
    - good if the vehicle comes back with a trade

How to improve penetration: Developing new skills and product knowledge through training can help F&I staff make incremental improvements by learning new ways to engage with customers, build rapport, and offer what customers truly value. 

For instance, F&I managers that interview the customer by asking questions better understand customers’ needs for F&I protection products.  Top F&I performers interview the buyer and then perform a thorough needs analysis before doing a menu presentation. 

Electronic F&I menus are now incorporating “smart survey” techniques that analyze consumer responses based on a lifestyles survey. Smart surveys capture answers to the questions F&I typically would y ask a customer. These surveys can be incorporated in the sales process while sales finalizes the deal for F&I.  Smart surveys identify respondents’ lifestyle traits and provide F&I information on the customers need for protection products. Smart surveys include a system that “learns” about the customer - their driving habits, ownership plans, risk profile, and more. The result helps consumers – and F&I managers - recognize what optional protection products would bring the most value to them. 

This technology: 

  • Reveals to buyers and F&I about customers’ personal risk analysis and compares it with the protection products offered at the dealership.
  • Provides insight into customers’ driving habits and ownership plans that help in understanding customer buying behaviors and interests.  This helps give dealers valuable insight into the F&I products that appeal to its customers and the products or services the customer is most likely to consider purchasing.
  • Dealers can utilize data to determine the products F&I should offer. This helps dealers in working with its vendors in designing new products and services for F&I to offer customers based on their needs and interest in buying.

Technologies like this that helps to match customers to the right products can make less experienced F&I managers more confident and responsive when discussing protection products with their customers. 

3.Average F&I Products Sold per Unit is Total # of F&I Products Sold ÷ by Total Vehicles Units Sold. For example: 250 F&I Products Sold ÷ 100 Vehicle Units Sold = 2.5             

How to improve products sold per vehicle: Having a third or fourth product presented to every customer every time is the third leg of a strong F&I product offering. For your dealership, this might be a dealer-branded prepaid maintenance plan or a bundled package of protection productsPresenting a fourth or fifth product can increase F&I penetration and PVR, but also customer retention and service sales.  A high-end menu system will ensure the right products are presented every time. Ask your F&I agent for new ideas to help you increase the number of products sold per deal.

4.Ratio between Finance Reserve Gross and F&I Product Gross – there are two calculations here: Finance Reserve Ratio (%)  = Total  Finance Reserve $ ÷ Total F&I Gross $, and
F&I Product Gross Ratio (%) = Total F&I Product Gross $ ÷ Total F&I Gross $.                         

Goal and objective are to have a higher F&I product gross ratio -This is because the sale of F&I products provide these values:

   1. Customer retention for the dealership
   2. Tangible values to the customer
   3. Higher resale value on the vehicle.

NOTE: Finance rate markup provides zero value to the consumer

How to improve product reserve/gross ratio – Improving the sale of retention-building products can help boost these key ratios. VSCs, prepaid maintenance plans, and other products that link buyers back to the dealership help build retention and drive service profits. F&I can increase sale penetration of such products by gaining more knowledge of how these products benefit the consumer and gives F&I confidence in presenting their value in compelling ways; if buyers see F&I is not bought into these products’ value, why should the consumer want to buy?  Utilizing state-of-the-art interactive sales tools like incorporating a Factory Warranty Review presentation using visuals that include graphs helps sell VSC products. 

5.Menu Utilization – an indicator that shows the frequency in utilizing a menu presentation system for offering and selling F&I products: Total # F&I Menu’s Printed ÷ Total Units Sold = Menu Utilization %. 

F&I menus are generated by F&I managers as either paper or paperless menus.  Electronic F&I menu systems now have reporting available that tracks F&I managers using an F&I menu presentation system and sales tools that include:

  • Needs analysis interview
  • F&I product sales tools that include graphs and videos
  • E-F&I Menu presentation, either printed or electronically prepared and signed.
  • Waiver form for products accepted and declines, either printed or electronically prepared and signed.


  • Instead of measuring utilization based on # or units, electronic F&I menu systems can measure time. Measuring time helps to evaluate F&I managers’ use of various sales tools, capabilities, and functionality that come with e-F&I menu systems.
  • Measuring F&I manager utilization of all resources that come with an e-F&I menu system helps
    support F&I menu training.  Measuring F&I manager utilization of a menu system provides for an effort-based reporting tool.
  • Menu utilization measures for quality results while F&I production measures quantitative results.
  • High usage of an e-F&I menu system and all the sales tool that come with the system can correlate to increase F&I production and profits for the dealer.

Manage by facts

Using data to manage a department eliminates subjectivity and emotion and helps managers focus on reality. The reality is within the data accessible from the store’s dealer management system or third-party F&I software platform. 

You will find these reporting tools very useful: 

  1. F&I Menu Reporting –   F&I reports created with data generated from e-menu systems.
  2. Dashboard Reporting – Dealer reports generated through F&I platform integration with the DMS.
  3. Distributor Reporting – For enterprise reporting from the platform for dealer groups and their F&I agencies.
  4. Utilization Reporting – Reports created that measure F&I managers the use and efforts of an F&I menu system as a tool for selling F&I products.
  5. Delivery-Type Reporting – Digital sales report analyzing in-store and online F&I activities and sales. 

Many changes are taking place in the automotive industry. We are seeing more OEM’s manufacturing and introducing EV’s in the marketplace. This may suggest the need for tracking the sale of F&I products by vehicle type.  This report, whether standalone or part of the dealer’s dashboard reporting, tracks the sale of F&I products across various channels, e.g. online versus in-store. This will be an important metric to watch as we move forward more deeply into the digital dealership.

Automobile dealers face many challenges in running their business. The competition for customers today is greater, and profit from the sale has been thinned by the OEMs. This has resulted in the need to generate more revenue from F&I to make a deal profitable.  Now, dealers also are facing the risk and loss of revenue from finance reserve and possible increasing regulatory pressure for add-on pricing as well, from the Consumer Financial Protection Bureau. 

With dealers facing more competition for customers, thinning profit margins, and potential loss of F&I revenues, dealers will need to depend more heavily on real-time data. These KPIs, when put into detail reports,  gives management crisp direction on how to make informed and intelligent business decisions for running the business and improving the dealer’s bottom line. 

Jim Maxim, Jr. is President of MaximTrak Technologies,  Reach him at

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