Has the Time Come for Virtual, Centralized F&I?

JM&A Group’s Jonathan Jordan wants dealers to realize virtual and digital F&I don’t always take place outside the showroom. Still, the capability to do so can lead to significant rewards for everyone.

One of the most significant is building a centralized F&I department that allows swift response to customers, whether they have routine questions or are ready to finalize deals.

“Customers want virtual digital experiences, but they also want a person involved when they start talking about financing and selecting products,” says Jordan, manager of Sales Strategy-JM&A Group. “We really believe that virtual (F&I)… is the perfect solution for these customer wants and needs as they go through the process.”

JM&A data shows 89% of car buyers prefer virtual F&I. Also, virtual F&I increases customer satisfaction with the buying process by 72%. More than half of those surveyed (63%) feel less pressured in a virtual environment.

These findings, combined with changes in business due to COVID, compelled JM&A to ramp up its virtual F&I program, which began in 2018. The result is more than 15,000 virtual deals in just over three years.

JM&A quickly notes it didn’t completely overhaul its F&I approach and processes. Instead, it took what it had developed during the past 40 years and adapted it to virtual applications.

Several ways to build centralized F&I include having F&I managers in a group’s stores share workloads, using JM&A experts to offer around-the-clock F&I support, including closing deals, and more. Centralized F&I is a boon for dealerships, especially those with a number of out-of-town customers.

JM&A notes centralized F&I is customized to suit the variables in each dealership or dealership group and staff don’t need to be tech-savvy.

The economies of scale cut customer wait time and free business managers to concentrate on other high-revenue areas such as fleet sales.

Jordan compares the approach to “‘Moneyball’ for F&I,” referring to the 2011 movie starring Brad Pitt in which statistical metrics are employed to improve a baseball team.“If you’ve seen that movie, you know it’s about ensuring that your most qualified employees get in front of all your customers.”

It also frees sales and other managers from backing up F&I staff, allowing them to concentrate on their specialties.

Dealer Renard Bergstrom, Bergstrom Automotive Group, Devils Lake, ND, works with JM&A to move toward centralized, virtual F&I. It ensures customers, primarily in the group’s two busiest stores, don’t have to wait for attention.

When there is a backlog of F&I customers, the staff puts one shopper into a specific area reserved for virtual F&I. Then a finance pro from another store connects with them.

Some dealers have met with minor resistance from F&I staff when they’ve introduced centralized services. As the efficiency allows sales volume to increase, the F&I pros realize they have the same number of deals as they did with the older system and grumbling disappears, dealers say.

Not all dealers are sold on virtual or centralized F&I. Tyler Corder, chief financial officer-Findlay Automotive Group, with 37 stores in six states, prefers traditional F&I processes.

“I’ve always been a proponent of decentralization. I don’t see how a centralized F&I office for the dealer group would work,” he says. “I’d rather have each dealership be individually responsible for their own F&I operation. My experience is that centralization of functions makes it hard to hold a store manager accountable for their store’s performance.”