Ron Reahard’s career in the auto industry has been shaped by his desire to do it right. As he worked his way up from sales, to F&I, and into training, he noted along the way the characteristics and skills that were lacking in many of those he worked under, as well as the characteristics of those who were effective at their jobs. In each scenario, Reahard saw a job that could be done with excellence and he made it his goal to do it better.
Working with a bad F&I manager, Reahard experienced firsthand the traits that caused him to be ineffective and disliked by the salespeople. He determined that if he ever got the chance, he would be everything that F&I manager was not; a knowledgeable, personable and professional F&I manager. This led to a successful six-year stint in the F&I office.
As an F&I manager, Reahard soon concluded that much of what he had been taught was really not applicable in the real world. That led to his next career jump - into the role of trainer. “I decided I wanted to go into training because I thought that it needed to be done right – better than most of the training I had experienced – and I felt very strongly that I would be able to do that.” And Reahard has been training ever since.
In 2001, Reahard started his own training company, Reahard and Associates, Inc., of which he is the president. The company began as a one-trainer operation but has grown to seven employees. He attributes the business’s success, in part, to the fact that training is all they do. “We don’t sell any F&I products or provide menu software. So we have the same agenda as our clients – to help F&I managers help more customers.” This has allowed Reahard & Associates to work with agents, finance companies, product vendors, vehicle manufacturers, dealer associations, individual dealers, as well as some of the largest dealer groups in the country.
The focus of Reahard’s training boils down to three things: adding value to the customer’s experience, ongoing training, and helping people. “If you aren’t adding value, you are adding aggravation. If your services and products don’t help people then you are not adding value. Our goal is to help improve F&I managers’ ability to help customers. A good F&I manager must possess needs awareness and product knowledge. You can’t sell a service contract if you don’t know anything about a car.”
Success, according to Reahard, is achieved through hard work and the continual improvement of your skills. “Training is never over; it is a process – not an event. The most important job F&I managers have is helping people. Knowing how your products work and being convinced they are going to help the person on the other side of the desk is key. It’s important for customers not to feel they are being coerced to buy something they don’t really need. F&I products have real value and customers will pay good money for them when that value is demonstrated to them. You have to be a champion of your products. If you don’t believe in your products and buy them yourself then you shouldn’t be selling them.” Reahard says that too often F&I managers don’t believe in their products; they just want to make money. “If you want to make more money, help more people. That is how you become more successful in any business endeavor.”
Issues Facing the Future
As income generated in the F&I office grows, Reahard predicts that the industry will see an increased scrutiny of all F&I practices. “Higher profits from F&I are drawing the attention of regulatory authorities, such as the CFPB. Honda and Toyota are both being challenged by the CFPB with regard to their lending practices based on the theory of disparate impact. If like Ally, they settle, I think financial reserve will probably go away. If they decide to fight this unproven theory, which is full of holes, then it may not happen. Either way, I think we will see increased focus on F&I sales practices, the mark-up on financing and maybe on products too, if no one reigns in the CFPB.”
Reahard says F&I managers generally need to know more about their products so they can be an important resource for their customers. “Customers today think they know everything and can find the answer to any question by using Google. If we can’t give them more information than what is readily available on the Internet, we aren’t adding value.”
While there is constant talk about how to speed up the process in F&I, Reahard has a slightly different perspective. “An auto purchase is a major investment. While I agree that customers don’t want to listen to a 20 minute canned sales pitch, our experience is that it is not the time spent in the F&I office that drives customers crazy, but the time spent waiting to get in the office! However, if customers are forced to endure multiple presentations or watch infomercials for products they’re not interested in, five minutes in the F&I office is too long.” He believes if the F&I manager is doing his or her job properly, customers appreciate having someone who can explain their options, answer their questions, and provide them with the information they need to make the right decision for them and their family. The end result being that the F&I manager will sell more products.
When Reahard is not busy training, you are likely to find him in his shop working on his 1971 Chevelle Malibu. “I love cars and I love working on them. My very first car was a 1971 Chevelle, just like the one I am restoring.” When it’s done, he says it will be identical to the one he bought brand new when he was 17. Reahard also enjoys attending NASCAR races with his wife Ann, and makes it a point to go to several each year. He also has two grandkids whom he enjoys spending time with.
F&I Changing Lives
Reahard shared the story of a former customer who was killed by a drunk driver. The customer had purchased credit life coverage from Reahard when he purchased the car. When his widow came in with the policy, she was distraught and in tears. She shared that she really needed to go back to college in order to support her three kids, but she couldn’t afford it.
Reahard realized at that point the true impact of what he was doing working in F&I. “I was able to tell her she did not have to worry about the car payment; it would be paid off. And because it was being paid off three and a half years early, she would get a refund of $1865 in interest. For her, that meant she could go back to college. When she came around the desk, hugging me and crying, it struck me like a bolt of lightning. That day we changed a human being’s life . . . for the better. We have an opportunity to do that every day in F&I.”