Special Finance is far more than an incremental opportunity! Special Finance is creative solutions to everyday problems such as poor credit history, no credit history, limited income, limited work history, negative equity, and limited cash down. With the majority of our population in need of these critical solutions, automotive dealers need an easy, repeatable, and proven system for leveraging solutions and changing lives… all while getting more appointments...more approvals...and more deliveries! Whether you have a separate special finance department or a blended operation, special finance could be your golden ticket to seizing opportunity and dominating in your market. However, if you really want to advance and conquer, your special finance operation better be "special." So what’s the magic formula? How do you know if your Special Finance Department is really “Special?” Here is the test….
Question #1: Does Your Dealership Get Everyone Approved?
You have zero excuse for not being able to provide every customer that walks into your showroom with a credit approval! The lending resources are readily available. At a bare minimum you should bring everyone in, submit everyone, and approve everyone. Everyone should receive an opportunity to drive and improve their situation! If this is not your process, you are likely doing much more damage than good by upsetting far more customers than you are actually helping. Additional questions to ask yourself: Have you built a portfolio of lenders that allows you to help customers across all credit tiers whether they are high or low income buyers? Have you purchased inventory to maximize those lending programs and marry those customers? Have you built strong lender relationships? Have you gathered the right information to adequately and profitably sell the paper and secure the delivery?
Question #2: Does Your Dealership Create Customers that are Flexible?
The biggest mistake you can make is trying to work a non-prime deal like a prime deal! The buying triggers are completely different. If a prime customer likes and trusts you, the dealership, and the vehicle…you typically have a deal. Not so with special finance… If you work a prime and a non-prime deal the same way, at best you will wind up with a short deal, at worst you will wind up with no deal at all. Listen, you have two options...you can either try to find special finance deals, or you can create them! Fact: The #2 reason why special finance deals are not delivered is the customers' lack of flexibility and unwillingness to accept the vehicle or payment for which they are approved. Dealers that dominate don't waste time and energy finding special finance deals; they create them! They don't ask their customers what they want to drive, what they want their payment to be, or what they want to put down; and then hope to find an approval and vehicle to match. They understand it's not about what their customer wants it to be, it's about what it can be. Their customers in turn understand it's not simply about buying a vehicle, it's about securing a solution! Additional questions to ask yourself: Do you create special finance deals or merely find special finance deals? Do you properly manage your customers’ expectations? Do you truly connect with your customers and become their trusted advisor? Do you build and leverage authority and ultimate influence with your customers to successfully guide them to delivery?
Question #3: Does Your Dealership Create Customers that Sacrifice?
Don’t tell me you believe "my customers just don't have any money to put down." Are you kidding me? That is the most ridiculous thing I have ever heard! Almost all of your special finance customers either have the money or have a way to get the money...every time! I have proved this to dealers time and time again. Dealers that dominate absolutely thrive in the area of cash down. Fact: The #1 reason why special finance deals are not delivered is lack of cash down. Cash down always either makes the deal or makes the deal better, but lack of cash down unquestionably destroys your opportunity for success. For some reason, many seem to think that the magic is in asking for it. The fact of the matter is no one, regardless of their credit, wants to put any money down...period! The magic isn't in asking for it, the magic is in motivating your customer to provide it. Additional questions to ask yourself: Do you have a defined process for consistently getting big customer down payments? Do you leverage the credit approval? Do you engage your customers emotionally and leverage their most powerful buying motives? Do you leverage your solution and its impact on your customers' family, occupation, and recreation? Do your customers dig deep and work as hard as you do to secure financing?
Question #4: Does Your Dealership Create Deals that Exceed Benchmarks?
It is impossible for you to routinely create deals that exceed benchmarks without completely maximizing the both the lenders' front and backend advances. Deal structure, submittals, and call backs are all key! Dealers that dominate know that lenders work harder to keep deals than they do to get deals. They also understand that building the deal around the PTI ratio is the foundation to maximizing advances. They never shotgun, they submit deals according to each lenders’ unique program guidelines and performance history. By submitting deals that are casual, customary, common-sense, choice, and collectable, they put themselves in a position to put more green on their screen (more approvals) and in their pockets (more deliveries). Additional questions to ask yourself: Do you structure deals to find opportunity or create opportunity? Do you have a systematic process for submitting deals to get more approvals? Do you have a callback procedure that enables you to build lender relationships and maximize every deal in both front and backend profit?
Question #5: Does Your Dealership Prepare to Close More Deals More Often?
Why would you struggle to overcome objections and close more deals? When's the last time you've heard a "new" objection? The objections are always the same, right? Preparation and process are key! Dealers that dominate understand that their customers make decisions emotionally and then justify those decisions logically. They discover their customer's most powerful buying motives and leverage them for success. They not only overcome more objections through easy and repeatable re-framing and de-framing techniques, but they also avoid many objections by carefully pre-framing objections long before they even become an issue. Dealers that advance and conquer are seasoned and experienced in creating out-of-box solutions to standard in-box problems. Additional questions to ask yourself: Do you engage and motivate your customers emotionally and logically? Do you discover and leverage their most powerful and compelling reasons to buy now? Do you have word tracts and processes in place to overcome objections and close more deals? Do you have a system for creating urgency and forming out-of-box solutions to in-box problems?
Question #6: Does Your Dealership Maximize Special Finance Leads & Drive Traffic?
Whether you purchase or organically generate your leads, special finance leads should be money in the bank! What better than customers raising their hands just looking for someone to help? With that said, contacting, connecting, committing, and contracting special finance leads each has their own set of challenges. Dealers that dominate do not struggle with contacting leads. They are experts at creating credibility, curiosity, and locking-down customer commitment. They employ a multi-pronged approach with proven word tracts and scripts that enable them to sell more appointments and completely blow up their show ratio. They convert more unsold showroom traffic, and drive additional traffic through referrals, reviews, social media, and strategic campaigns. The #1 reason a customer doesn't return your call is they are not curious enough to pick up the phone. The #1 reason a customer does not show up for their appointment is they really don’t believe you can help them. Additional questions to ask yourself: Do you have a process for creating credibility, believability, curiosity, and locking down customer commitment? Do you simply call your leads or do you campaign your leads? Do you have a process for converting unsold showroom traffic, and driving additional traffic through referrals, reviews, social media, and other strategic campaigns?
So how did you do? What was your score? What's so "special" about your Special Finance Operation? I look forward to your comments below...
Michael Hirschfield is the President of Cornerstone Dealer Development, LLC and founder of the proprietary Cornerstone CS3℠ Sales Process, the CreditCare ℠ Subprime Selling System, and the XperienceCare ℠ F&I Selling System. Michael says "relationships ought to be everyone's top priority and greatest ambition!" To accelerate your success in sales Connect Compel Commit!