Top F&I providers offer more than just products: Key factors for dealers to consider.

When dealers select an F&I provider, there are many important factors to consider other than just the suite of products the company offers. Making the right choice is no small matter; choosing a provider that can serve as a trusted consultant and collaborator can provide significant financial and operational benefits for dealers. Gabe Garroni, Senior Vice President of Insurance Sales at Ally Financial, offers some helpful insights that can help dealers navigate the decision-making process.

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Q: When it comes to selecting an F&I provider, what factors should be most important to a dealer?

Gabe Garroni: A good F&I company isn’t just a product provider. Most companies offer a very similar variety of products, so dealers expect more than just getting a product to sell. A good F&I company differentiates itself by operating as a trusted consultant and the key differentiator is its people. The ideal team has deep knowledge about how a dealership works, along with the connectivity of each department so they can address the full scope of dealership needs on a holistic level. They leverage information in a consultative way to help each dealer address challenges and opportunities that are unique to them.

Q: How does a consultative approach work and why is it effective?

Garroni: A true consultative approach is customer centric. While we certainly want to communicate our differentiators, it’s more important to listen to dealers and extract key themes that allow us to help dealers solve their specific problems. Most of the time, dealers won’t say they have an issue with a particular product, but they would say something like, “My team is green” or “I’m trying to expand my footprint.” These are important indicators the account team may recognize and address when they meet with a dealer. If a dealership’s team is new or lacks experience, there should be a specific training plan that focuses on the basics – leadership building and so forth – to set that team up for success and help the dealer retain talent.

Q: How does one become a dealer’s trusted consultant?

Garroni: That comes with time and requires perseverance, consistency and patience. The business must be earned with every visit and every interaction. After a strategic plan is put into place, both parties need to agree on clearly set service-level commitments and each must be accountable to that plan. That aspect is very important. If a dealer hasn’t bought into this concept, then there will be a lack of commitment throughout their store and success could be limited. If dealers believe in the plan, they will get their team on board to execute. To gain trust, the account executives may hold roundtables on a regular basis to assess performance with the broader team. If milestones are being missed, they should be addressed early and often to course correct. As time goes on, that account executive ideally would become the natural “go to” person whenever there are other issues or opportunities. Said differently, a true trusted consultant should sit on the same side of the table as the dealer’s leadership team.

Q: Can you provide a specific example of how this method could improve a dealer’s performance?

Garroni: It’s all about joint accountability. First, the agreement is carefully crafted to identify the learning and development areas of greatest need, along with the corresponding results expected from improvement in those areas. Then, by agreeing on service-level commitments and getting leadership to buy-in, a dealership may increase overall product penetration, which may significantly boost profitability. We’ve seen dealers improve product penetration by more than 20 percent just by leveraging the tools we’ve given them to succeed.

One simple methodology involves tailoring your pitch to a customer’s unique situation, so it instantly becomes more relevant. For example, an effective customer interview can provide insights into why a customer chose a particular car. Are they looking for safety, performance, economy or – just a fun car? Determining customers’ motivations for buying or leasing particular vehicles can provide valuable insights into how they allocate value, while also giving insights into their ability to pay for unforeseen expenses.

A service walk is another tried-and-true method that’s often overlooked. This can help customers to start thinking about owning, maintaining and servicing their vehicles with the selling dealers. This mental shift helps producers discuss the many benefits of programs that are geared towards improving customer experiences and retention while reducing the stress and uncertainty of possible mechanical failures. The many benefits of the full suite of F&I products may be obvious to dealership personnel because they are exposed to them daily, but it may not be as obvious to a customer purchasing a vehicle once every three to five years.

Q: What sort of new concerns do dealers have that a trusted F&I provider could help address in today’s environment?

Garroni: Compliance has become a huge issue as the regulatory landscape continues to evolve. There are new areas of focus, particularly around protecting customer data and there’s also a greater emphasis on dealer transparency. Compliance isn’t merely a check-the-box exercise. Some high-profile dealers are facing hefty fines for non-compliance and there also are reputational consequences that can create longer-term impacts.

Dealers already have a lot on their plates from running their businesses day-to-day, so it’s often hard to notice compliance-related issues. That’s where we come in. Being able to help dealers see around corners by providing tools so they can identify potential gaps or weakness in their operations really aligns with the idea of being that trusted provider.

For instance, conducting a simple dealer jacket review isn’t enough. To help dealers gain an understanding of potential risks, our teams dig into the details and analyze dealerships’ operations on a more comprehensive level, from how they train their employees and hire and fire them to how they store customer data and market their products. We then bring in a compliance expert from the Association of Dealership Compliance Officers (ADCO), which offers tailored classes at a discounted price for dealers that do business with Ally. As a trusted consultant, our team works with dealers on an ongoing basis to ensure we’re proactively addressing any issues, which enables them to focus on their businesses.