Sunday 9 October 2016

A hybrid approach to F&I staffing

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At Lexus of Bellevue, client advisers use a showroom docuPAD to sell customers F&I products.




The single-staffer approach to sales and F&I has become more common among dealerships in the past few years, though some industry experts still don’t see the value or the sense in it. Lexus of Bellevue has launched a hybrid model effectively — with a finance director steering operations.


F&I profit per vehicle at Lexus of Bellevue in Bellevue, Wash., doubled after the store switched to the hybrid approach.


The idea to have F&I managers add a sales role came up about three years ago when the dealership required its F&I managers to meet customers on the showroom floor, said Jason Vena, general manager of Lexus of Bellevue, which is part of the 12-store O’Brien Auto Group, based in Bellevue.


Then, he said, “there was a constant conversation in regards to retaining traditional salespeople in an environment where new-vehicle margins are declining. A lot of that has changed the financial dynamic on the front end.”


Vena asked a third of the staffers, those whose skill sets pointed to success in sales and finance, to take on both positions, renaming them client advisers. Eventually, the entire sales and finance staffs transitioned to the combined role.


“From a selling perspective, is it hard to get 30 people to follow a process? Yes,” Vena said. “But once you get everybody understanding, it becomes a way better option for the customer.”


Lexus of Bellevue calls itself an “uncar” dealership. It is a single-point-of-contact store whose front-end staffers for the most part have little dealership experience.


The person on the showroom floor with the customer has the best chance to learn what the customer needs in terms of F&I products and financing, Vena said. At Lexus of Bellevue, that person, or client adviser, uses a docuPAD — an interactive electronic menu screen and processing system — to take customers through the purchase and sell them F&I products.


Document processors handle the contract, purchase order and lease order, also on the docuPAD. Document processors speak English, Korean, Vietnamese and Spanish. Vena said 30 percent of the dealership’s customers benefit from having a bilingual staff. The client advisers and document processors can look to the finance director, Erika Olson, for guidance.




Lost staff


The dealership lost a third of its staff during the switch to the hybrid model. Some staffers just didn’t believe in it, Vena said. It didn’t match their mindset. Rather than trying to make the most profit on a vehicle, he said, the store “is geared toward figuring out what the customer wants to purchase and how to help them protect it.”


The most successful sales staffers work off of referrals.


Today, most of Vena’s sales staff has no previous dealership experience. Many of the staffers were in retail, cellphone or electronic sales. Some of them had administrative positions at businesses.


“They are not your extremely tenured sales personnel,” Olson said. They are “not geared to sell the car at all costs. That helps. Even the handful that had experience were only at the dealership for a short time.”


Slow payoff


The strategy didn’t pay off for Vena at first. “When we originally moved from traditional to this system, we didn’t move anything,” he said.


But he wasn’t discouraged. He never worried that it wouldn’t work.


“I went into it assuming that I’m going to gain income,” he said. “If you do business to meet the customers’ needs, I don’t know how you’re not going to succeed.”




Document processors use an isolated one, to take them through contracts.



His faith in the hybrid approach helped his remaining employees embrace it, he said. “It has been a complete group effort that’s focused on the customer.” 


The tangible change came when Vena hired Olson in January from AutoNation, where she was corporate finance director for the state of Washington. The dealership has no finance managers. Instead, Olson sits at the hub of the sales desk, overseeing financing. She takes care of approvals, hashes out deals and handles compliance. 


Under Olson’s leadership, F&I revenue per vehicle retailed doubled to $2,000 in six months. 


“The biggest thing is maintaining that direction of PVR,” she said. To do that, she assists client advisers when they need it. Because they are essentially doing two jobs, they may forget to recommend certain F&I products, she said. Before the client advisers go over the product menu with customers on the docuPAD, they confer with Olson on which products would best fit the customer and the vehicle. 


More than half of the dealership’s customers lease vehicles. Lease customers buy 2.8 F&I products on average, about the same number as the dealership’s loan customers. 


Olson says guiding client advisers is a big part of why she’s there. 


“Twenty percent of the time, they find themselves in a pickle,” Olson said. “I’d rather have them get real information than pass on bad information.”



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A hybrid approach to F&I staffing

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