We continue to hear about how a one-touch sales structure can potentially improve the customer experience and offer dealers a better sales compensation structure. On the surface, using the technology available today that allows the customer to work with a single point of contact to get a quote on a vehicle, value their trade, and structure possible financing would seem to simplify the process, increase speed of delivery, and increase overall customer experience and satisfaction.

But from a dealership standpoint, moving to a one-touch structure requires some careful consideration and involves several challenges. Before taking the leap, ask yourself these four questions.

Is the sales culture in my dealership ready to support this kind of change?

The shift towards a one-touch experience is driven by the desire to improve the customer experience. But there is more to the customer experience than just the number of employees involved in a deal. 

More than anything, today's consumer desires transparency, convenience, and speed. A more streamlined process would certainly help deliver on these consumer expectations. But if your current sales culture already struggles to meet these expectations, will that change simply by deciding to move to a one-touch experience? Are there changes you can implement to improve your existing sales process and culture while still maintaining a more traditional model? 

A dealer may be able to reach most of their experience goals through a faster process aided by available technology without changing their entire personnel structure.

Do I have the time and resources to recruit, train, and develop staff in all areas of the sales process?

Many dealers consider a one-touch structure because it can help consolidate some of the staffing necessary to work the car deal. It is not intended for a single person to handle pricing, trade appraisal, deal structure, bank submittal, menu presentation and document delivery. In some cases, this can end up with the same number of staff working the deal behind the scenes, with just one person presenting these figures to the customer. Developing the know-how to be a true single point of contact requires extensive training. That means dealers need someone with the expertise and the time to invest in development. There will be a tremendous amount of training necessary especially with moderate to high turn-over in the salesperson position. Are you ready to make the necessary investment in the technology and training to make it work? Do you have the resources to handle this level of training and development? How many people will need to be certified in a recognized compliance program to protect the dealership?

Do I have the right pay plan to retain skilled employees and maintain total dealership profitability?

Moving to a one-touch sales process may require the implementation of a non-traditional pay plan. Have you considered the right management structure to support the sales team as well as how your compensation plan will be impacted? Some dealers have experimented with hourly or salary structures instead of more traditional commission-based pay plans. The right management structure to support the sales team and motivational factors in your pay plan will be critical.

There could be some advantages gained in a new compensation structure. Most studies show that people are seeking the right work-life balance as well as the highest possible compensation, so you could find that employees may be attracted to an hourly or salaried structure. A dealer may see a better balance in overall profitability if a one-touch process leads to a consistent profit margin and compensation balance, but your approach in developing both structure and process will be key to achieving this goal.

Do I have the right technology and process to control the pricing factors necessary for overall success?

As an industry, we are moving closer to a place where technology can help govern every aspect of a deal and provide the customer with a fully online purchase experience. But why can't we use that exact same technology to add to the showroom experience? The truth is, it is possible with available technology. Desking, trade appraisals, loan structure and submittal, F&I, and deal funding can all be managed and cross-checked with the help of technology. 

However, keep in mind that technology will never fully replace the knowledge and training that comes with the experience of your current staff. Structuring a car deal can be complicated based on equity and credit, and consumers still want a human touch. 

You may also want to consider the experience of your F&I product vendor’s training resources. Do they understand the one-touch structure and do they have experience helping dealers implement it? Are they committed to the level of on-going training and development this structure requires? You'll achieve the most success by partnering with a vendor who can recruit, train and certify all staff for compliance. A partner who understands the dynamics of shifting to a one-touch sales process and its potential impact to profitability.

Moving to a one-touch sales process is not a decision to be taken lightly and is not necessarily the best model for every dealership. Take the time to consider all aspects and potential consequences of making the shift. 

Are you thinking of implementing a one-touch sales structure? Based on available technology and the demand for a better customer experience, dealers will continue to explore this option—but not necessarily in a one-size-fits-all form that works for everyone. When considering the switch to a one-touch process, it's essential to consider the challenges that may come with it.

1) Loss of Gross

The traditional showroom personnel structure typically involves a separate process for selling the car and then financing the deal, for good reason. Profit margins have been effected by internet pricing in recent years, meaning F&I products are often a major source of income that is increasingly important to the dealership's bottom line. Dealers have relied on finance managers with the expertise to work offers with the terms and products that benefit both the buyer and the dealership.

Consolidating these processes with employees who have less experience working the terms of a deal raises the risk of lowering sales performance or overall variable gross. Even if the dealer maintains experienced management staff to review vehicle pricing, trade appraisals, loan structure, or F&I, the devil is in the details. Removing steps and putting things like trade in value, loan structure, and F&I product sales in the hands of someone with less experience could affect the margin on every deal. 

Possible Solutions: 

• —The right technology that gives staff access to information they may need at any point during the sale, including pricing guidelines, loan submissions and approvals, and trade evaluations
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• —An excellent, easy-to-understand F&I menu system

Even though technology solutions are getting better at helping employees drive these processes, it still comes down to the dealer's culture and ability to recruit and train staff who can use them to their full potential. The steps you take to develop your staff's ability to use digital tools to enhance the sales process will affect their ability to deliver profitability with a one-touch sales structure.

2) Showroom Operations

Another challenge is finding the right management structure to support a one-touch sales process. More traditional models create accountability through a centralized desk structure with specific roles and expectations. But who manages a “team” of one?

There are multiple approaches to creating a team that can run a more streamlined process. Some dealers have hired former management as full one-touch salespeople, with a hybrid commission structure to allow for more experience. Others have attempted to keep on a certain level of management to support the sales team from behind the scenes. No matter the approach, a dealer must consider who will be responsible for handling loan structuring, bank requirements, cash flow, CIT, kicked contracts—not to mention monitoring accountability for expected department gross performance.

Possible Solutions:

• —Consider the right ramp up strategy and the training that will be necessary to achieve high performance

• —Consider how you can attract and retain management with the right pay plan

3) Training Up

Training for sales teams tends to focus on product, presentation, and working up initial figures. When their focus is on showing the car, managing the test drive, and getting the credit application completed, this level of training works well. But adopting a one touch solution means expecting one salesperson to have the skill sets of the three to four people traditionally involved in the process. Training staff to be involved in the loan structure, F&I offering, and the complete closing process requires a sound strategy and training that is far more frequent and intensive than what has been offered to salespeople in the past. 

Introducing the benefits of your F&I offerings earlier so that customers understand how the products play into—and improve—the overall ownership experience takes some skill. When and how you introduce their options can make all the difference. Buyers who have already agreed to terms are less likely to want to adjust those terms again in the F&I process. The method you develop here will be your key to success.

Possible Solutions:

• —Consider the right sales IT platform to deliver a tool that will help your sales staff conduct all necessary actions in selling, financing, and delivering a vehicle

—An online compliance program to train and certify staff in federal and state regulations, terms disclosure, lender requirements, and cash reporting and handling

—A partner that understands the sales and F&I space well enough to keep current and future staff on a consistent training plan tailored to optimize sales at every step

The challenges may seem daunting, but there are dealers who are finding success with this structure and have managed to deliver a better customer experience using a single point of contact. And with multiple market forces demanding a more convenient and straightforward way of buying a vehicle, the right strategy and support are critical.

Are you providing the experience your buyers want? Customers will always want the right car at the right price, but more car buyers are looking at other factors when considering where to buy a car. Current consumer behavior indicates that transparency, convenience, and speed are almost as important. One phrase can sum up buyer expectations: the easier, the better.  

But meeting this expectation can be easier said than done. Dealers have valid concerns about changing the traditional sales structure that has worked well for so long. Still, market forces are driving some dealers to consider a consolidated one-touch sales process, where customers interact with one person throughout the entire buying process.  

To make the right decision for your dealership, it's important to understand the forces that are moving the industry in this direction—and the potential drawbacks to making such a significant change.

Technology 

Technology now exists that allows car shoppers to get further down the funnel in the car-buying process without even visiting the dealership. Digital tools enable consumers to get an appraisal for their trade-in vehicle, work out their payment terms, and other steps in the car buying process without ever stepping foot in the showroom or interacting with a salesperson.

Empowering consumers to work their own deals is a net positive, as it makes them feel more confident and in control about the purchasing decision. But technology is not a replacement for well-trained, consultative staff. It's an extension of your showroom experience. The primary benefit of upgrading your dealership technology is to help streamline the sales process and shorten the time spent buying a vehicle. The numbers speak for themselves—after nearly 70% of auto dealers added digital retailing tools last year due to COVID-19, customers who described themselves as "highly satisfied" with their overall shopping experience reached 72%, up from 60% in 2019.

Despite the incredible rise and popularity of ecommerce, buying a car is still a complex process. Most car shoppers still have questions and want human guidance during the process, from comparing models to taking a physical test drive, understanding financing options, and setting up their new vehicle. Technology cannot replace the human expertise necessary to guide car shoppers through the entire sales process. 

Consumer Car-Buying Experience

Dealerships face tough competition from disruptors such as CarMax, Carvana, and Vroom that promise a better customer experience through digital tools. As a result, many dealers are looking for ways to differentiate themselves by matching or exceeding the customer experience found at these online retailers. Want proof? Ask yourself how many car ads you see these days that focus entirely on the customer experience and ease of business as opposed to a particular vehicle and the price.

But what do customers really want when they purchase a car from one of these sites? Transparency, convenience, and speed. A one-touch sales process may help provide those things, but your dealership's ability to meet these customer expectations depends on your culture more than anything. If you can meet these benchmarks by developing your current staff, a one-touch process may not be necessary.

One of the most annoying parts of the sales process for buyers is sitting around, waiting to be introduced to the used car manager for an appraisal, another manager to approve the terms, and yet another manager for the F&I process. Finding ways to eliminate the waiting, streamline the process, and speed up transaction times will help improve the car-buying experience without making a move towards eliminating all human interactions. Can your current process be improved to minimize the time traps of appraising a trade, submitting credit for approval, and waiting for F&I with your existing staff?

Is your current showroom process flexible enough to allow the customer to pick up on-site where they left off on-line? Are you using your online tools in the showroom to provide information to your sales staff so that the buying experience is similar whether customers are in your showroom or on their computer at home?

Shrinking Profit Margins

Some dealers view the benefits of a one-touch process from a financial standpoint. As margins have been effected by market-based pricing and trade models make it less profitable to sell a car, the next place to control expenses can be reducing how many people get paid per deal.

A one-touch process would shift most of the transaction primarily through a single point of contact. The fewer managers that are above the single point of contact, the more salespeople you could hire while still reducing the number of people that need to get paid per deal.

A more consolidated team may mean that customers are working with more experienced staff throughout the entire transaction. The goal is to maintain or increase current performance while limiting the expense to deliver overall.  

Personnel 

Let's face it. Finding and retaining good employees is getting more difficult, especially in the current market. Consider: A more empowered and proficient staff would be a good thing. A higher paid staff should lead to less turnover. Technology may make this more possible than it used to be but requires cross training of current staff and extensive training for new hires to bring them up to the level of expertise necessary to make one-touch successful. To make this level of investment worthwhile, dealers will need to focus on creating and nurturing a workplace culture designed to attract and retain quality candidates.

Switching to a one-touch sales process is not a decision to make lightly, and it may not be the right fit for every dealership. It's an emerging model that could present substantial risks for dealers who leap without thinking it through, but can also provide a better customer experience, more sales, and higher ROI. One recommendation is to consult with a forward-thinking vendor partner who can help you assess whether a one-touch process is appropriate for your dealership and then work with you to develop your business no matter what path you choose.