Many dealerships unwittingly forego $200-$300 in additional gross per deal either because finance and insurance managers don’t use menus or use them ineffectively.

The F&I menu has been around for a while as a way to show products, services, packaged deals and prices in a format that is easy for customers to understand.

It also allows the F&I manager to present the offerings more efficiently, making a sale more likely. Menus started in paper form, but many now are in software programs.

F&I experts agree a menu in proper hands boosts F&I gross, while helping a dealership comply with government disclosure and truth-in-lending laws.

Still, some studies indicate only about a third of dealerships use this tool to present all available F&I products, including gap insurance and prepaid maintenance. Inconsistent, spotty use is considered not much better than no use.

Based on sales data from 11,000 F&I transactions, menu use led to a $300-per-car difference, says Jim Maxim Jr., president of MaximTrak, an F&I software firm. “That’s about $912 per vehicle retail vs. $613.”

Data on menu use by 13 same-brand domestic dealers shows F&I profit per vehicle increased $181 on average. Vehicle service-contract penetration went up 7.5 percentage points; GAP penetration, 15.7 percentage points.

“Stores where this kind of F&I performance happens have a dealer-driven focus on menu training and penetration,” Maxim says. Mediocre results occurred at dealerships “where a top-down focus on menus was lacking,” Maxim says.

Menu use and F&I managers’ involvement in the early stages of car deals increase F&I grosses, experts say. They point to these benefits:

  • A menu, whether a hardcopy or online, helps the F&I staff better explain product features and benefits as well as helps customers understand what is being offered and how it will affect monthly payments.
  • Menus help F&I managers sell packaged, multiple products, eliminating the time-consuming step-selling required when presenting products individually.
  • Menus help the F&I manager address customer concerns and build value.
  • Menu use shortens sales time in the F&I office. Overly long stays often lead to customer impatience and, in turn, low satisfaction scores.

The dealer should hold the F&I office accountable for correct menu use with every customer and a full presentation of products, says Maxim, noting that stores doing that show exemplary F&I performance.

“There is a large group of dealerships that use menus religiously,” with stellar results to prove it, says Terry Dortch, president of Automotive Compliance Consultants.

Menu use also can help dealers keep out of legal trouble in a couple of ways, he says.

First, it requires the F&I manager to present all products all the time, reducing the chances a dealership later will face discrimination charges by disgruntled customers claiming they weren’t shown all options, such as a less-expensive extended-service contract.

“Second, if the menu presentation is done right, the F&I manager properly discloses how the price of products being purchased affects the payment, keeping the dealership in compliance with the Truth and Lending Act and the Car Buyer’s Bill of Rights,” Dortch says.