A recent study shows that more than 280 million registered vehicles are currently in the United States. This data is a clear indicator that running an auto dealership remains profitable as ever. However, not every business in this niche can meet its sales quota despite the consistent demand.
Auto financing for independent dealers continues to be one of its top income sources. But you need to apply the proper techniques to secure a deal in most of your transactions.
Your F&I team is vital in boosting your sales numbers. While the F&I manager holds an enormous responsibility in securing a deal and protecting your dealership’s CSI, it is still a team effort. As such, you need to get everyone involved in your strategy.
Here is a collection of the most practical and effective tips you can get your F&I team to implement. They cover every aspect of a car dealership’s journey, from establishing the business to keeping the company running in excellent condition.
Starting Out in the Right Direction
Establishing a used car dealership offers greater freedom than a franchise dealership. You truly become your own boss when you choose to go with the former than the latter. You have a lot more choices of vehicle makes and models to offer your customers. Plus, you will have greater freedom to choose the best financing strategy to provide. However, you also need to understand the intricacies of the business in order to lead your dealership in the right direction.
Understanding the Significance of Financing
Before going full force into a specific strategy, it is crucial to understand the importance of financing when starting a car dealership. Doing so will help you align with the value this critical service will provide to your customers.
Opting for In-House Financing
Taking the time and effort to establish in-house financing is paramount to an independent dealer‘s success. This uncommon yet essential approach among used-car dealers can considerably improve your business performance. Your F&I team can offer better financing options to your customers with this approach, ultimately leading to better customer satisfaction.
Learning to Close a Deal
While you may already have a tremendous success rate in closing deals, you need the rest of your team to be on the same level as you. Teaching them specific techniques in closing a car deal can help dramatically improve your sales number.
Maximizing Profit from Auto Financing for Independent Dealers
If you have been in the business for quite some time already, you already understand how important it is to get your customers to choose the financing terms your dealership is offering. Customers require authenticity and transparency now more than ever. Exhibiting these qualities and providing them with lucrative auto financing options is always the best path to take.
Apply Customized Strategies for Used Car Dealers
Sales-boosting strategies for car dealerships are aplenty. Try searching the internet, and you will find various techniques that can help improve your business.
However, F&I sales tactics are in a different league of their own. Therefore, it is never a good notion to immediately start using any techniques you find right from the onset. Instead, it would be better to implement specific strategies for independent auto dealerships. Doing so will help you improve your performance more efficiently, taking out the guesswork from the equation.
Master the Art of Deal Structuring
Deal structuring provides your auto dealership with two possibilities. You can either close the deal quickly – even before reaching your F&I office – or prep the customer up so that what you offer becomes very compelling.
However, structuring an agreement is not a straightforward process. Plus, when you consider how a terrible deal structure can negatively impact your numbers, it becomes even more crucial to understand the art of deal structuring.
While optimizing a deal structure takes too much work, a competent F&I manager can contribute many crucial elements. If you combine this with a sales manager who aligns well with your deal structure, your F&I team can execute a strategy that works almost every time.
Offer Financing Options
Even for small car dealerships, hitting the sales quota every month does not necessarily mean you have reached the peak of your business. Think about it. If you can package the deal with auto financing, you will be able to boost your profit dramatically.
Most businesses do not consider including financing for small car dealerships because of a lack of deeper understanding. However, this is one of the primary products your dealership should have in order to provide excellent service to your customers. It shows your clients that you are not just in it to simply make a sale but also want to provide utmost satisfaction to them.
Boost Your Bottom Line
Even if you are already offering financing options to your customers, you must still make sure that you are not incurring unnecessary costs due to your current setup. To do so, you must first improve your bottom line by clearing out the clutter. And a subprime auto lender is one way of accomplishing this.
It can be challenging to forge a business relationship with the best financing providers for subprime consumers. However, it is not impossible to do so, even for newly-established dealerships. Outsourcing this process to an excellent F&I professional is just one of the best strategies to help you build partnerships with subprime auto lenders.
Aligning with the Best Auto Financing Companies
You can find numerous auto finance companies for used car dealers. But not all of these firms have the capability to help you improve your business performance. Therefore, it is better for you to understand your priorities first. Then, choose the one that aligns with your short-term and long-term goals.
When searching for an auto financing source for your dealership, you need to ensure they have extensive experience in partnering with other independent auto dealerships. Going through the application process would be a waste of time and effort if you find out later that they only cater to franchise dealerships.
Independent auto dealerships offering financial solutions may seem far-fetched back in the day. But because of companies like Vantage Finance, this is no longer impossible. Vantage Finance provides several ways to boost your dealership’s performance. Some of their solutions that can help you grow are:
- A low-risk approach using a virtual finance broker that decreases financial risks to your customers
- Financing options that help you attract more customers and keep your existing customers from switching to other dealers
- Extensive business connection to a multitude of lenders, allowing you to sell multiple F&I products
- Strategies that can boost your sales by offering financing options to your customers, making your business a one-stop shop
- Virtual F&I program that targets potential customers who are searching online to buy their next car
Rise Through the Challenges of Operating a Used Auto Dealership
Running an independent auto dealership, at the very basic, is the same as running any other business. You should have the right tools to push through any challenges. And as you go through the obstacles, you also need to implement effective growth strategies. The tips and techniques you learned here will help you every step of the way, and if you partner with the right financing company, growing your business becomes more natural.
Ready to take your auto dealership to the next level? Partner with Vantage Finance today and boost your profit.
