Dealership Sales Methodology

by Arzu Algan on the December 26th, 2007

People love cars and the decision-making process: the model, equipment, color and so forth. They take pride in the possession of a new car. What they generally don’t like is the experience of shopping for a new car. They often feel manipulated and mismanaged. Regardless of the deal they negotiated, there is always the feeling they could have done better, or that they were “taken.” Many are convinced that an undercurrent of dishonesty runs through the retail automotive business.

The basics of the automotive sales process are well known. First you advertise to get people in the door. As soon as they are on the premises, you determine the model that interests them and explain the product highlights. While conducting this walk-around presentation, you point out the performance, safety and comfort features. After a test-drive around the neighborhood, you get down to the basics of making the deal: checking and appraising any trade, presenting your first offer at pricing, and taking a deal to management (or sometimes taking management to the deal). With offers, counter-offers and negotiations complete, it’s time to talk financing. After presenting the other dealer services, an F&I (Finance and Insurance) manager calculates the financing, rate and monthly payments. By the time the customer picks up the new car, the salesperson is already focused on the next customer.

That’s the way cars and trucks have been sold for more than 70 years. Today’s consumers require better service, professional qualities and excellent product knowledge. The only way to guarantee an enjoyable shopping experience for your customers is to follow a sales process that is firmly grounded in meeting customer needs and exceeding their expectations:

Attract new customers without relying merely on price-oriented advertising.
Welcome the prospective buyer and establish a relationship, removing the customer’s apprehensions about the process of shopping for a new car.
Determine your customer’s needs, then target your presentation of product features and benefits to meet those needs.
View the delivery process as the beginning of a productive relationship – not the end of the sales process.
These procedures not only help turn prospects into buyers, but set the stage for long-term customer relationships that result in both repeat and referral sales. Today the customer cannot be manipulated by old-fashioned, high-pressure sales techniques. Instead, their needs must be identified through communication.

The same rules apply to the transaction in the Finance Office: customers expect the open communication, respectful treatment, and superior product knowledge they experienced on the sales floor to continue while they meet with the F&I Manager. Should this expectation be disappointed, the customer is likely to abandon the transaction all together.

In the past, F&I Mangers and salespeople alike may have spent 10 percent of the time building rapport with the customer, 30 percent presenting products and 60 percent closing the deal. Nowadays successful F&I personnel and salespeople invest 50 percent of the time building rapport, 40 percent presenting products and dealer services, with the remaining 10 percent usually more than enough to close the deal. Today’s focus is on the relationship between the customer and the dealership personnel, rather than just the mechanics of the deal.