We all know that on a busy Saturday at the dealership, customers come in waves – one minute the dealership is empty and the next it’s packed. Now, imagine you’re a salesperson coming back from the test drive when your customer’s buying temperature is at its peak. You drop your customers at your desk only to join a line of two or three other salespeople, all waiting on numbers from the manager, who is swamped, working numbers on multiple deals, appraising vehicles and more.
How long would it typically take you to get that first pencil out to the customer? On average, we hear dealer management say it takes 15 to 30 minutes to get a first pencil out to the customer. Think about that. The customer’s buying temperature is the highest right after the test drive and we make them sit for 15+ minutes. The old saying of “Time kills deals” comes to life. We are literally psychologically programming them to not only shop around on their phone but to leave without buying.
There has to be a better way, and the good news is there is! Here are a few strategies to remove the bottlenecks from the sales process and fast-track the YES:
Enable Salesperson to immediately present a first pencil after the test-drive
When customers return from the test drive, their excitement is at its peak and delays in presenting numbers can cause their urgency to buy to decline. To prevent this, dealers using AutoFi have their sales teams collect info from the customer to pass on to their manager before going out on the test drive. This enables the manager to set up and desk the deal (while the salesperson is out on the test drive), including payment options and trade valuation and payoff. And when the salesperson returns from the test drive, they can take the customer straight to their desk to immediately pull up the numbers with the flexibility to play around with factors like down payment and term without going back and forth to the desk. All of this under management guardrails that prevent price discounts and errors.
Determine affordability early to avoid surprises and set proper expectations
One of the most common delays in the process is a mismatch between customer expectations and the final deal terms. If customers aren’t aware of their financing options or realistic monthly payment early on, the negotiation can turn into a battle. To avoid this, top AutoFi dealers introduce affordability checks early in the process. This includes, pre-qualifying customers through a soft pull which helps them to understand their budget and interest rate. This avoids sticker shock or the customer walking away because of unreasonable expectations of what they can afford or get approved for.
Offer choices
In the car business, we normally present the customer one option to say “yes” or “no” to. Here is the price. Yes or No? Here is the approval. Yes or no? However, studies show that giving consumers multiple choices and options, increases their likelihood to purchase and oftentimes at a price or rate higher than they intended. Top AutoFi Dealers are leveraging the power of choice in a few areas, including the payment negotiation where a salesperson is enabling their customer to play around with levers like deal type (finance vs. lease), down payment or term, or even choose a payment from a 9 box. AutoFi dealers also leverage choice in the presentation of lender approvals, presenting up to 3 lender approvals, which gives the customer validation that the interest rate is reasonable (even when it’s higher than their expectations). And lastly, dealers are offering choices in F&I product presentation, utilizing a menu approach that takes the focus off of individual products and instead packages.
In Summary
We are often creatures of habits and have accepted the status quo as it relates to the bottlenecks in the sales process and the lengthy time it takes to sell a car. But in my work with dealers nationwide, I know that embracing these strategies and best practices has enabled them to not only streamline the process and reduce friction, but in return increase their profitability – with the most engaged AutoFi dealers increasing their back-end profit by $765 per deal.