The Road to the Sale

Special finance is about attracting customers, understanding their vehicle needs, effectively pre-screening their buying power (ie: their credit), and presenting a selection of vehicles you can sell and finance for a profit.  Your success will be determined by the collective talent and efficiency of your team to do so with every customer, with every deal and without exception. 

A clearly defined sales process will ensure that each member of the team knows exactly what to do, when to do it, and why we do it this way.  This detailed process is your “road to the sale” and a strict adherence to it is the best way to avoid the common pitfalls of inexperienced dealers across the country.
 
The top three common mistakes by dealerships when working with non-prime customers are:
1. Attracting customers with price driven advertising.
2. Attempting to sell a vehicle that does not budget for the customer or cannot be financed.
3. Presenting the finance options (deal numbers) to the customer prematurely and without giving them a sense of choice.

These three mistakes are almost impossible to overcome and will kill your chances for a profitable special finance sale every time.  The best way to ensure success is to develop, define, and execute your sales process with consistency, accountability, and plenty of practice.

The 15 Step Special Finance Road to the Sale

1. Plan for the Sale – You will increase your chances of selling by developing a consistent plan of attack that accounts for all possible outcomes, questions and objections.  Sales is about numbers and you must have contacts, prospects and a presentation to sell anything.  Your sales plan is your roadmap to achieving your sales goals.
2. Attract Prospects – Special finance customers need reliable transportation and want value and choice.  They are often jaded however by the flurry of fast talking unprepared salespeople who overpromise and under deliver.  As a result, they have become skeptical of the offers for Guaranteed Financing.  Your advertising is your first encounter with a prospect and must set the tone for a relationship that builds trust in the minds of your future customers.  
3. Master the Telephone – Your sales operation will live and die by the telephone.  If your entire team does not learn to master their phone skills with proven scripts and word tracks that bypass price and overcome objections, you will find your traffic count to be low and the credit scores of your customers to be even lower.  You will miss out on that segment of the market that actually has the ability to shop other stores.  This is particularly important as more and more dealers delve into special finance.   Most customers will shop from the comfort of their home and in front of their computers in order to gain as much information as possible to avoid the embarrassment of the turn downs usually encountered at car dealerships.
4. Set the Appointment – An appointment implies professionalism.  It also implies that your time is valuable and in demand.  The ability to set appointments that show up to the dealership is a critical skill required for success in special finance.  You must be able to separate yourself and the dealership from the competition via the internet and the telephone. 
5. Meet and Greet the Customer – A bad first impression will put your prospects in a first class seat on the “Be Back Bus” headed directly to your competitors.  Every customer must be met with professionalism, enthusiasm, confidence and an eagerness to serve.  You must be able to handle the typical sales de-railers like price and vehicle focus right from the start.  A standard initial greeting welcomes the customer to your establishment and sets the tone for the entire relationship; it will give your sales team the confidence to stick to the plan.
6. Perform a Thorough Needs Analysis – The “Needs Analysis” is the second phase of the pre-sale and should occur shortly after your first encounter face to face with the prospect.  It will separate you from the competition and help position your team as experts in the industry.  The needs analysis is also a critical step in the process for bypassing price and taking the customer’s focus off the vehicle and directing it to the financing whereby they can improve their credit rating in the future.  The needs analysis is an incredible closing tool that can be used later in the process to sure up the deal and/or increase the down payment.
7. Take a Customer Statement (Credit Application) – The customer statement is the second part of the customer interview, subsequent to the needs analysis.  It must be accomplished accurately, with diligence and attention to detail.  The information will be used to make important credit decisions and there is little room for error, particularly when it comes to the calculation of gross monthly income and time on the job.  This is one of those events where an ounce of prevention definitely outweighs a pound of cure.  Take your time and complete the customer statement in detail with accuracy.
8. Make a Credit Decision – Time is of essence!  With accurate information a sales desk manager or an F&I manager can and must make a correct assessment of the customer’s credit strength and buying power in order to present vehicles for sale that can be sold and financed at a profit and fitting the needs of the customer.  The decision maker needs a thorough Needs Analysis, an accurate and complete Customer’s Statement, and a detailed credit bureau report that corresponds with the lenders in your market in order to effectively make the credit decision.
9. Vehicle Selection/Re-selection – The desk manager must take into account the inventory in stock and available for sale, old age inventory, deal profitability, and the customer’s desire in order to present vehicles that the customer qualifies to purchase.  It is important that you give the customer a selection of vehicles from which they can choose and never give the impression that they have to buy something that they don’t like or want because of their credit situation.  The desk manager can always control the deal with the Four Square Presentation.  So don’t worry about the customer getting locked onto a vehicle that will not work.  More often than not, most customers will choose a vehicle that first meets their budget then their needs, then their wants.
10. Structure the Deal and Obtain Lender Approval – While the salesperson is demonstrating the vehicle, the desk manager (or finance manager) is working to get the finance approval from the lender with the deal fully optimized based on LTV (Loan Amount to Book Value).  This step validates the earlier credit decision and must be finalized before delivering the vehicle to the customer.  However, again time is of essence, you don’t need the final approval to accomplish the Four Square Presentation.  As long as you don’t have immediate “turn downs” from the banks, you can proceed to the customer presentation.  If you delay too long in this process while you try to make the perfect decision or want the approval in hand, you risk losing your customer’s attention and interest and, your chances of delivering a profitable deal will drastically decrease.
11. Demonstrate the Vehicle and Test Drive – While the financial details are being worked at the lot, the salesperson is taking the customer on a demonstration ride and “selling” the selected vehicle.  It is important to treat your special finance customer as you would any other customer and exceed their expectations as a prospective buyer.  The test drive should be as routine as every other step of the sales process.  You should have a pre-determined demonstration route that includes a pull-off location to accomplish the “walk around” that is away from all the distractions of the other vehicles available for sale.
12. Customer Presentation – After the needs analysis, the credit decision, vehicle selection and test drive, after all the work that has gone into the incremental sales process, it is now time for the customer presentation.  I will warn you however, that a presentation of financial numbers to any customer should never take place unless you have all the decision makers present and your customer is ready to make a commitment to purchase.  Otherwise, you are only empowering your prospect with enough information to go shopping.  The purpose of the customer presentation is two-fold: to isolate and overcome objections and to gain customer commitment.  The best and most effective technique I have found to accomplish this is the Four Square Presentation.  If it is used properly with a consistent and proven word track, it will help you close more deals and increase the much needed down payments to boost profitability.
13. Close the Deal – One common mistake made by salespeople throughout, regardless of their product or service, is the failure to ask for the sale.  You must ask the prospect to buy your product and then gain their commitment; the true litmus test for commitment is the deposit.  A prospective customer will not leave a deposit unless they are reasonably certain they are going to buy.
14. Contract and Deliver – Once you have sold a vehicle that you can get financed and still earn an acceptable amount of profit you must now contract the customer and deliver it to them.  This is the step in the sale where there is ZERO tolerance for mistakes.  Your contracts have to perfect and you must collect the deal stipulations up front.  Otherwise, your contracts in transit will cause the AR’s to skyrocket and your comptroller will be screaming.  And, the one stipulation that should NEVER be missing in any special finance deal is the customer’s proof of income. 
Anyone who presents loan documents for a customer to sign must be thoroughly trained on all Federal and State compliance requirements along with the various lender programs.  They should also be familiar with vehicle title and registration requirements for the states in which you do business.
15. Ask for Referrals – This is the last and perhaps the most important step on the road to the sale.  This is the time when you ask your customer for referrals, not references, but referrals.  You should ask for five referrals from every sold customer with the expectation of gaining three new prospects.  Immediately after the sale is the best time to do so.  It is the time when you have the best rapport with your customer and the deal is still fresh.  You’ve invested a lot of time, money and effort into your customer and at this point in the sale they will be more than glad to provide some referrals.  If they’re not, you may have some serious problems with your sales process that’s going to cost you business in the future.

If you implement a detailed and consistent “Road to the Sale” and execute it every time, you will find that your team will understand your sales process and improve with every sale.  Your sales ratios will increase along with the gross profit of every deal.  Your customers will be more satisfied and the turnover among your sales staff will decrease.  We are all creatures of habit and the more we do something, the better we become at doing it; the more we understand, and the more confident we become as a team.

Mr. Tom Herald is a Professional Consultant and National Trainer and with Benjamin Herald Associates.  He has over twenty years of experience in the automobile business and ten years as a dealer principal.  He is a former Air Force Commander with extensive training as a leader and instructor.  He is one of the top experts on Special Finance and can be reached at tom@heraldassociates.com or by phone 859.816.7990  
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