To effectively run a Direct Mail Invitation sale or a sale where the lender is present offering on-site credit approval, it is recommended that the following procedures be adhered to:
1. When the prospective customer is greeted and after the standard dealership greeting is performed, determine what brought the customer to the dealership. EXAMPLE: "Mr. Jones, we at Harpeth Ford Mercury appreciate you stopping in today to evaluate our vast inventory of new and pre-owned automobiles. Did you happen to receive one of our pre-approved invitations to this weekend's special sale in the mail or did something else bring you in to visit with us today?" If yes, go to step 2. If no, reassure the prospect that even though they did not receive an invitation, "today is a wonderful opportunity to purchase a vehicle since we are having a special sale and there are representatives from the bank on-site to offer instant credit approval."
2. At this point, lead the customer into the dealership. SIT THEM DOWN. Ask them if they brought their approval certificate with them and start the sub-prime sales process. Explain to the customer that the first thing that needs to be done is to determine the line of credit available from the financial institution promoting the sale. The first step is to fill out a customer statement-FILL IT OUT IN ITS ENTIRETY- the more information provided, the quicker the approval process and the higher the gross. Offer the customer a cold drink or cup of coffee.
3. Turn the customer statement over to the financial representative(s). If the customer has a trade, fill out the appraisal sheet (provided by financial representative), being sure to fill out all information including ALL OPTIONS (if an option is not on the list, write it down on the bottom of the page). This is very important-the higher the book value of the trade, the more potential for trade equity no matter what the ACV of the trade is. LENDERS DO NOT SEE THE TRADE AND DO NOT CARE WHAT THE DEALERSHIP PUTS IN IT! The only thing the lender looks at is the book value.
4. While the customer's credit is being evaluated and the trade is being appraised, if a trade is involved, taking the customer on a walk through the service area is a good way not only to keep them occupied but also to give you the opportunity to build rapport. You now want to explain the procedures they will use when they bring their new or pre-owned quality vehicle to the dealership for service. This is the first opportunity to begin the education process of how important it is that they make sure to ask the finance manager about an extended warranty. The service contract benefits for the customer by protecting their investment are as follows:
a. They will never have to worry about unexpected expensive repairs that may be financially challenging at certain times of the year.
b. A vehicle with this type of protection is normally in better condition when it comes time to trade and that makes it worth more. "Mr. Jones, wouldn't it be nice to have a dealer offer you what you know your car is really worth?" Our buyers always offer more to our customer when they know that their trade has been kept in tiptop condition. (Using the word buyer does not put the manager in a position of having to argue with the customer over the value of their trade).
This process should take you 10 to 15 minutes, giving enough time for the credit and trade to be evaluated.
5. Report back to the tower, desk or designated manager to determine if the customer needs to be turned over to the financial representative or if it is time to show them the first of only three cars that they may have the opportunity to invest in. When it is time to begin the vehicle presentation process, you will be provided with three vehicles that fit in the parameters of all aspects needed to sell, deliver and FUND a vehicle that the customer should be able to afford. This is based on each individual customer's situation. Understand that most of the people that you are dealing with know they have less-than-perfect credit and are genuinely appreciative if they have an opportunity to take delivery of a new vehicle. If the customer has a comprehension problem, feel free to flip them back to the financial representative for an attitude adjustment. When you have the bank on-site, it makes it easy to be the hero because everything's the bank's fault.
6. The only commitment you need to get from the customer is that this is the vehicle that they would like to own. Play dumb, remember the bank is the one that picked out the vehicles that they would consider extending them credit on and it's the bank's responsibly to make sure that the payment fits into their budget. And "we all know how conservative bankers are --the payment will probably be less than you thought."
7. After all the above has been successfully completed, notify the tower, desk or designated manager. Find out from the customer what STIPS they brought with them (as listed on the Pre-Approval Certificate). GET THE CUSTOMER IN THE BOX! Assist in the closing process by making copies of the stips and making sure they get in the deal jacket.
Good luck and remember the only way any of us make any money on this kind of a sale is if EVERYONE works as a team.
Mark A. Hafner is CEO of Automotive Solutions International Inc. If you have specific questions or require more information about this subject, please check the appropriate box on the reader response form on page 3.