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Jared Hamilton
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Rebecca Chernek

Rebecca Chernek President, CEO

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Full Disclosure Menu Selling or Not?

You would think with the magnifying glass on car dealerships around the country today, F&I managers would take heed of the importance placed on full disclosure selling.

You would think they would understand why disclosing a base payment, the APR, the term and all buying numbers prior to offering other product options is critically important.

Unfortunately, there is still confusion regarding “full-disclosure” menu selling. 

Utilizing the menu to offer 100% of the products to 100% of their customers 100% of the time is good business . . . BUT, it’s not the entire story.

Gone are the days when choosing certain products to sell to certain customers works. A consistent pricing matrix for products offered is crucial. Overcharging one customer for a product, because we think we can get away with it or because we learn they have poor credit history is no longer an acceptable business practice.

A full disclosure menu is utilized to ensure that every customer clearly understands the terms of the contract prior to the negotiation of other products. The key word is “prior.” This means the manager is not vague in negotiation efforts and did not confuse or manipulate the customer. It means the manager can demonstrate that every customer is treated fair and square.

A menu, although not a mandatory document, states that the dealership is honest and forthright in presentation efforts and that the customer personally selected products after fully understanding the basics of the sale. It states that the dealership has no purposeful intention to manipulate or confuse its customers. 

Managers have the responsibility to ensure utilization of the menu safeguards the dealer against potential liability. If this premise is understood . . . why don’t we have more managers buying into the practice?  One reason is that certain managers lack the skills required to overcome objections. For some, it’s due to the fear factor.

Manager who want to succeed in menu use must prepare, study, rehearse word tracks, and conduct practice interview sessions. Those who decide to ignore these steps won’t be ready to deal head on with the customer’s concerns. Sometimes, when the deal comes into finance from the sales department, the customer has not been told the exact monthly payment or even what they agreed to pay for the vehicle. Some stores still have no buyer’s agreement signed by the sales manager or customer before the deal comes into the finance office. It’s up to the finance manager to disclose this significant information.

This may sound absurd to some reading this blog, but the truth is many stores still support “box” closing. Box closing and menu selling do not go hand-in-hand. Managers who tell me they can effectively box close and utilize a “full disclosure menu selling presentation” increase my anxiety level. The two methods of selling just don’t mix. Time after time, I review menus that aren’t complete—the base payment or the buying numbers have been deleted. I have often reviewed menus where the finance manager has deleted the disclosure terms. This is a dealer-controlled sales procedure, but for the record, we should call it what it is, option selling, box closing and step selling. The idea behind full disclosure menu selling is that the customer knows the base payment, the APR, the term, and all the buying numbers prior to the negotiation of products. This has always been important . . . but after two years of enormous changes in the car selling industry, it rises to the top of the list. Savvy customers want to be treated with respect and honesty. When they are, they become valuable word-of-mouth advertisers for the dealership and repeat customers.

Full disclosure menu selling works. It’s a great way to increase overall performance without jeopardizing dealership business. It retains customers for life. Menu selling is not just about the finance department. Menu selling is a “culture”. . . a belief. The store must support full disclosure selling from the sales person on the lot to the sales management and everyone in the business office. To pretend that compliance begins in finance is a foolish practice. Having every manager on the same page with the same message will increase profits significantly, while keeping the customer coming back time after time.   You don’t have to break laws to break records!

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