An Interview with Tony Wanderon, President/CEO of Family First Dealer Services

Since the onset of the recession many people and businesses have been forced to make changes - some of which are quite significant. Not all changes that have occurred, however, have been for the bad. My path recently crossed with the ‘Guru of GAP,’ Tony Wanderon, who has been at the cusp and a part of, many changes over the past five years.

Because many of us have had to make changes in our own lives, I asked Tony to share a little about the changes he has experienced and asked if he could provide some insight that can hopefully help (to some degree) all independent agents in the Automotive F&I industry.

Can you tell us about your new company, Family First Dealer Services, what type of products you offer and how they can add value for the Independent Agent?

Wanderon: Well Family First Dealer Services is a new venture of mine focused on providing products and services to agents, manufacturers and Lenders nationwide. Over the past 6 months we have been able to partner with some of the leading underwriters and companies to bring together what we think will be very compelling for agents.

Two unique, offerings we are bringing to the market are Trade In Protection and something we call Agency Brand Builder. Trade In Protection, is what I call Trade GAP, which provides a customer the ability to purchase a negative equity benefit of up to $5000 when they decide to trade in their vehicle, after a qualification period. For dealers it’s a great way to provide peace of mind to their customers and since the benefit can only be requested if the customer returns to the selling dealer, it is a great customer retention tool.

Our second offering is what we have named “Agency Brand Builder.” Having owned an agency, which I sold to a public company with a great consumer brand, I have seen the value of both sides, the agent and the underwriter. From that experience, I have clearly seen that the reason dealers, in most cases, do business with the agent not the underwriter’s brand.

Clearly, the financial stability of the underwriter is critical, but most agents do not do a good job of building their brand, with their own agency branded programs and marketing materials. With that, we have built a service that offers larger agencies the ability to private label products, with great underwriters, supported by a best-in-class, administration and a brand builder marketing and creative team who understands their business.

Lastly, we will be introducing our new GAP product over the next 60 days, at first region by region with a national rollout by year end. With over 20 years’ experience marketing, underwriting and developing GAP products, I think our new program will set a new standard.

Do you think an agent should sell products for all departments in a dealership (i.e., F&I, Sales, Service), or should the agent focus solely on F&I? Why?

Wanderon: It depends on the agency and how diverse they are in their understanding of all the areas they may expand into. Over time I have found that you always need to look for new and better ways to distribute your products, the challenge is spreading yourself too thin. Many agents take a very hands on approach to support, which builds a lot of trust with the dealer. Often, with that trust and respect, many expand into other areas, without taking into account the resources needed to not only support the new department, but maintain the support needed in F&I.

Personally, when I was an agent we grew so fast at times that I took for granted that some of my best dealers (whom I personally provided support to) would be ok if I was not there as much as in the past. When a couple left due to lower support levels, I changed our strategy.

It’s very labor intensive to provide all the training for an entire dealership, and sometimes a lot of companies/agencies want to do everything for everybody, but they end up losing focus that puts their core business at risk as we did years ago. So, I would say, it’s great to expand but you may need to bring on the additional resources and invest a bit prior to generating any revenue.

What products in the market do you see performing well right now?

Wanderon: Well I think that it depends on the market and the dealer. With customer retention and service playing such a key role in the past few years, I see some longtime products really starting to take hold on either a blanket or optional basis. Those products are Maintenance, Vehicle Appearance, and Limited Lifetime warranties as well as certified vehicles.

I think like always, everyone is looking for the next great thing and we think our Trade In Protection product, provides something that fits for the customer, dealer, and the lender. But as always, I think the core products still remain the bread and butter – service contracts and gap.

Do you now of, or can you foresee any technology changes on the horizon?

Wanderon: I think technology is changing every day. It’s amazing how far we have come in such a short period of time. I know from my perspective, dealers today submit most, if not all, of their business electronically.

Dealers and agents can see production reports on their smart phones and customers are getting comfortable with filling claims online. At some point soon I can see VSA and OEM’s being able to do most of their repairs online rather than in a dealership. At this point I think anything is possible and it is a great time to be in the business if you have an open mind and fast feet.

What do you think some of the major hurdles an agent will experience that he/she will have to overcome in the future?

Wanderon: Clearly, I think the regulatory environment is very challenging and both seasoned and new agents need to keep up to date on everything that is going on. Relying on your providers to keep you up to date is not enough. Agents need to form committees and join organizations that can assist them in keeping up to date on what is happing, and in real-time.

Over 5 years ago, I became a member of an association called GAPA, this group headed up by Tim Meenan really provides great information that allows us to share current issues with other companies who are members. It in turn this allows all involved to provide a much better level of support and information to each of our clients.

Based on your vast experience working with agents, what are the characteristics of the best general agents?

Wanderon: I think a fundamental characteristic would be that an agent cares about their clients as much as they do about their own business. It is important the agent understand that being able to go in and analyze a dealers business, making proactive decisions, finding the dealer the right people, and being truly engaged in the dealer’s success, will drive long-term profitable relationships.

As I said before, an agent should keep up to date on everything that is going on in the industry, know everyone in the market, and find best practices and implement them easily and effectively. I think that more and more we are seeing the last days of an agent who only sells price, and while price is important for a dealer, today more than ever, dealers know that they need a partner not a provider. Lastly, the best agents are persistent and know that a sale takes time and they never ever give up.

Looking back over the last 5 years, how has the industry changed and how do you see it changing in the future.

Wanderon: It seems that there is more consolidation in all areas of our business with less small agencies and dealers out there to sell to. Manufacturers are getting much more aggressive in looking at providing a complete line of F&I products and services to dealers on a more global basis. While there is consolidation, there is more competition in the marketplace and many more products out there.

In addition, 5 years have brought a lot of change attributed to the financial crisis of 2008 which has opened the door to dealers being much more engaged in the day to day operations of their stores. I continue to see dealers looking for new ways to do business, better ways to treat and retain customers, and how to navigate through the regulatory environment.

I think agents have to build the product portfolio around not only profits today but profits tomorrow, and help the dealers reduce costs, and seamlessly integrate technology to enhance the customer experience. I am truly looking forward to the next 5 years.