July 12, 2021

The Disconnect Between F&I and Service

NAC Blog
NAC Blog

The Disconnect Between F&I and Service

These days, you've probably noticed that there's a lot of stress on your F&I department. After all, they're the ones that work on nearly every single sales deal that goes out your door. As with other departments, it's important that your F&I department doesn't function on its own island; this is for the good of the F&I department and for the store. Ever since F&I became its own entity within dealerships, there has been a tendency for an invisible disconnect to develop between that office and the service department.  

The Disconnect Between F&I and Service

Let’s get hypothetical: say your F&I manager sells a “bumper-to-bumper” service contract to a new customer. Six months later, the customer returns to the dealership with what they believe is a covered repair. A service advisor reviews the situation and determines that the repair isn't covered by the service contract after all. Suddenly, you've got an immediate conflict between departments that can cause internal animosity—and serious customer satisfaction problems. If this disconnect isn’t resolved quickly and effectively, it will almost certainly lead to lower sales in both departments and poor customer retention rates. This gives the F&I team, the service team, and the sales team fewer customers—and therefore fewer opportunities to make sales. Furthermore, if enough customers have a negative experience like the above example, they are likely to tell other would-be customers not to bring their business to your store. It’s a lose-lose.

The Service Advisor—Your Number One Salesperson

Avoiding and combating a disconnect between F&I and service takes creativity and staff education. One solution? Train service advisors to offer service contract coverage packages that weren't offered at the time of sale. This is vitally important and may even require that the dealership hire a dedicated person to focus on this function and nothing else. While this may take some time to properly nail down, it's really no different than when F&I was first created as a stand-alone entity. The biggest key is to teach this individual how to uncover the need for a service contract, then how to sell it and deliver it in a short timeframe.

But how do you train a service advisor to be a successful salesperson? Proper service advisor sales training needs to be equally focused on the customer’s needs and the F&I products and department services that fulfill those needs. This process involves a lot more than just ticking off a box and moving on to the next customer: preparation is key and is an advantage that is unique to your service department in this case. In the service department, you know exactly how many customers you have coming in every day. According to J.D. Power, your service advisors are dealing with between 12 and 15 customers every single day. This far exceeds the volume that even your top front-of-house salespeople are talking to. Teach your advisors to spend 30 minutes near the end of each day going through the next day's appointments and pouring over each customer's service history at the dealership. Do they already have a service contract? Have they never had their air filter replaced or an alignment performed? When your service advisor is prepared for the individual needs of each customer, they'll be able to increase cash flow and build new revenue streams for the dealership. It also reinforces the service advisor as an expert on the customer’s vehicle, creating a positive impression on your customers.

Whatever approach you take to ensure that your dealership’s departments all have the same goals in mind—namely making sales, providing excellent customer service, and driving repeat business in sales and service—your store will benefit from this unity of purpose. Even as margins on vehicle sales have risen in the last year, it is important to think ahead and ensure that your dealership has a large pool of happy customers that want to continue to do business with your store in the future.

For even more information on this topic, check out the video recording of our podcast episode of Fixed Ops 5 on our YouTube page. And make sure you subscribe to the podcast on Spotify, Apple Podcasts, Pocket Casts or wherever you listen so that you never miss a new episode!

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