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Long hours and fluctuating compensation can cause F&I managers significant stress, leading to job dissatisfaction and even burnout.
Some dealers are implementing flexible schedules for better work-life balance and comprehensive pay plans that entail not only commission but a consistent base salary.
Especially as younger dealership employees become F&I managers, flexible schedules and quality of life have become more important.
Some dealerships have hired part-time F&I managers. They work about 30 hours per week and still make $150,000 a year, said Lycia Jedlicki, performance partner for 20 group operations at NCM Associates.
Robinson: Urges vacation time
For the full-timers, it’s vital that dealers encourage them to take their vacation time, said Rashelle Robinson, finance director for Capitol Toyota in Salem, Ore. She talks with her F&I managers often to ensure they are comfortable with their hours. It’s about “understanding that they’re not workhorses,” she said. “You can’t work them into the ground and expect them to be successful long term.”
Eric Savage, president of Freedom Auto Group in central Pennsylvania, said he would love to reduce the workweek to 45 hours or fewer, “but we haven’t figured that out yet.”
Most of his F&I staff work hours ranging from the high 40s to low 50s per week. Each of Freedom Auto’s six F&I managers handles about 70 transactions a month, a healthy balance, Savage said.
Savage: Seeks 45-hour week
Seventy transactions a month could be about the right cutoff for F&I managers. After that, productivity declines, according to Tony Dupaquier, director of The Academy, the national training center for F&I provider Service Group in Austin, Texas. That signals an opportunity for dealers to hire more F&I managers, he said.
Yark Automotive Group in Toledo, Ohio, began giving its F&I managers 50-hour workweeks, down from 70 hours, after expanding the F&I staff and moving to a restaurant-style scheduling system, Finance Director DJ Supan said. He sends out a fresh schedule every Saturday morning for the following week. Employees’ days off vary from week to week, and the entire staff knows who is on or off on a particular day. The system also helps Supan ensure that the F&I staff sticks to a 50-hour week. Over the past several years, Yark Automotive has gone from nine to 12 to 14 F&I managers. Once a month, Supan tries to give each person in the department a Monday, Thursday and Saturday off. “It helps a lot with the guys’ attitudes,” he said. The stores are closed Sunday.
Providing balance
On average, F&I managers brought home $135,710 last year, up 3 percent on a same-store basis from 2014, according to the 2016 National Automobile Dealers Association Dealership Workforce Study.
Industrywide, F&I manager compensation still is primarily performance-based, but some dealers have expanded pay plans for more balance and reliability.
Tim Hlavenka, general manager at DCH Montclair Acura in Verona, N.J., pays his F&I managers a commission only, based on the percentage of gross profit they generate. “We pay for performance,” he said. “People in the F&I office are successful salespeople. They are not the lazy, complacent type.”
They jump on the chance to produce, he added. “You have hungry people that are willing to work hard.”
Yark Automotive also pays mostly on commission, which is derived from individual and team performance, but it has a small base salary, too.
A couple of years ago, the dealership group tripled the salary and decreased commission. “It gave the pay plan a little more consistency, balance and eliminated some of the highs and lows,” said Doug Kearns, the group’s vice president.
For the commission-based pay, the finance staff gets paid from a pool based on team production, but F&I managers’ individual shares are based on the income they generate personally.
Supan explains it to his F&I managers this way: “It’s a complete team pay plan, and I want you to be the best player on the team.”
Ron Reahard, president of Reahard & Associates, suggests dealers should provide F&I managers a pay plan that ensures the more income they generate, the more money they make. But dealers must be consistent, he said. When dealers begin writing big paychecks every month, they often lower the compensation plan because they can’t pay an F&I manager $20,000 per month, for example, even if that was what the manager earned. That frustrates F&I managers and often drives them to leave the store, Reahard said.
Avoiding surprises
Many dealerships have a base salary, but the majority of F&I income is performance-based, he said. Dealers should have annual performance-level adjustments, rather than monumental changes. The overall compensation plan shouldn’t change much, he said.
To avoid conflicts and surprises, dealers should have written, not just verbal, pay plans, Reahard said, and if dealers are focused on a specific area — say, customer satisfaction — they should spell that out in the pay plan.
Tamping turnover
- Flexible schedules
- Consistent base salaries
- Additional F&I staff
- Part-time F&I managers
- Written pay plan with clear objectives
Dealers revamp F&I managers' hours, pay
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