Join the conversation with some of the automotive industry’s leading trainers and F&I coaches. - IMAGE: Narvikk via

Join the conversation with some of the automotive industry’s leading trainers and F&I coaches.

IMAGE: Narvikk via

For 16 years, the Dealers’ Choice Awards program has given dealers and dealership personnel the opportunity to shine the spotlight on the vendors, suppliers, and auto finance sources that help keep their wheels turning. During a recent conversation with executives from some of these DCA-winning companies within the training arena, F&Idiscussed ways in which their companies found success, popular topics and new trends in their areas of expertise, and what’s on the horizon for 2021. Among the winners was Ritch Wheeler, vice president of training at American Financial & Automotive Services; United Development Systems/Brown & Brown Dealer Services’ vice president of training, John Tabar; and Greg Goebel, CEO of DealerStrong.

What is the biggest shift in focus for automotive training in 2020? 

Ritch Wheeler: A lot of folks would probably point to something digital or technology related, or some sort of new medium that we had to learn to use, based on the pandemic and what was going on around the country. And while that was certainly important, I think we all learned to focus on the experience. How can we provide the customer with a world-class and personalized experience when we interact with them, whether that be digitally, in person, in the sales department, F&I department, or even the service department. 

What we learned throughout 2020 is that most consumers can get just about any product and most services by the click of the button. So if you’re going to separate yourself from the competition, you really have to do it based on the experience you provide to them. That’s really the only differentiating factor, so that’s what our focus was in 2020. We explored a lot of different ways to do that, but at the end of the day, what we’re all really training on is how to create a better experience for the consumer. 

How have the circumstances of 2020 affected your approach to training and will that factor into your training offerings in 2021?

John Tabar: I think 2020 was an interesting year to say the least. The most obvious shift was probably moving from in-person to doing more online/virtual training and coaching for our clients and their learners. As a company we had to evaluate our capabilities and determine how we were going to be able to serve customers back in March and April when it was tough. I think within that process, we were positioned very well. We’ve always had online and virtual training supporting what we do, but I think the pandemic really moved that into the forefront. What we really needed to do was realize some of the benefits that came out of that. Right now, with remote training, self-directed training, and even the curriculums we’re working with, everything has changed, and it’s really not going to change back. 

I think customers are used to getting that experience and our dealership associate customers enjoy getting the training they need in real time and specific to them. I think we are going to see that more and more moving forward. The training that we are going to be providing needs to be relevant to the dealer, and the off-the-shelf kind of training development that some have done in the past may not be as adaptable to what we need now. We need to deliver the exact training they are looking for, in the medium or the format that they want, and on their schedule; so that’s what we will be doing moving forward. 

How have you seen dealers evolve their training since the onset of COVID? 

Greg Goebel: Dealers are finally using technology. I have been doing video training and consulting for more than a decade, but the challenge has been the fact that few people were using the technology needed to make it more effective. Today, that has changed for many organizations. After the first two weeks of the pandemic, everyone suddenly had cameras. Now video cameras and microphones have been installed, viewing stations have been built, and I have successfully conducted five 20-group meetings on Zoom. Some of the people in these groups were barely able to use email prior to this, so with the use of technology, they have all been able to have trainers like me appear in front of them and train for 60-90 minutes. This has also made it more affordable for my clients. Until the pandemic forced us to use this technology and set up training stations, the only other option was to put people in cars or on a plane and send them to our training classes, which takes them out of the stores and also costs more. Dealers have started training multiple rooftops at the same time, using the best trainers at each of their locations, to be able to deliver training to all locations. It has allowed for more frequency and more consistent messaging across the organization. 

I have also seen organizations improve their communications as a result. With people suddenly having to work remotely, they had to make it work. Many people have are using tools like Slack, which has improved efficiency at their operations. 

Sales managers are taking on more tasks that in the past have been traditionally F&I tasks. How do you think that is impacting F&I performance?

John Tabar: I think it depends on the experience of the sales manager. I think if they have some F&I experience and are in a situation where sales and F&I are working together, it can have a positive effect on F&I performance and profitability. Unfortunately, that isn’t always the case, and there are people on the desk without as much F&I experience as we would probably like, which can have a negative effect on F&I performance, profitability, and, in some circumstances, it can increase compliance risk. In a perfect world, I would like sales managers to have F&I experience before they assume that role, but we don’t live in a perfect world, and dealerships are always struggling with personnel. I would ask dealers if they are evaluating the sales manager and training them on F&I and deal structure, which is really important — get them the training and development they need. 

An F&I certification would be appropriate for someone moving into a sales manager role. About 18 months ago we started offering a course called F&I for Non-F&I Managers, and it’s become one of our most popular courses. We designed it for sales managers, but we found that we’ve got sales managers, BDC managers, and general managers that didn’t have F&I experience also taking the course. I think the great outcome from it is that we pulled the curtain on F&I a little bit, giving them a foundation for compliance moving forward. It has also increased communication, and anytime we can increase communication and understanding when F&I and sales work together, the deal structure gets better. And when deal structure gets better, so does profitability.

What are some of the biggest changes in sales training for 2020?

Ritch Wheeler: We used to have these very perfect silos of the sales department and the F&I department, and they all completed their own tasks. But now those lines have been blurred just enough to where we have some sharing of responsibilities, which may change depending on the customer or on a particular deal. Some of those responsibilities have even been picked up by the consumer themselves, digitally, before they ever enter the dealership. A customer may have gone through some sort of discovery period on their own where they are virtually doing their own presentation on the vehicle and their own test drive of the vehicle. They may have even already digitally appraised their trade online and even used an online payment calculator or some tool of that nature. There are now so many components that a customer can complete prior to coming into the dealership, that we had to create a sales process that no longer puts everything in those perfect silos, but instead looks at the deal holistically. 

If we can create a sales process that transitions the customer from their online experience to their offline experience seamlessly, with less friction and fewer pain points, you are going to have a happier, more satisfied customer. You are going to shorten your transaction time, which equates to more gross profit with higher CSI scores. I think the goal for sales training is looking at the sales process holistically and thinking about what the customer has already done before entering the dealership. Don’t take the customer back to square one, pick them up where they left off. We then need to help them complete that car-buying journey, working together with all three departments to make it happen. It’s no longer, “this is my job, that’s your job.” 

What percentage of dealers have strong internal training programs, and what do you think the obstacles are for those who do not? 

Greg Goebel: It’s disappointing to answer it this way, but as a training consultant with more than 7,000 dealers and their personnel, it’s my experience that a small percentage have a well-focused and consistent training program –– maybe 10-15%. I have worked with some prominent organizations, and I am just amazed that they didn’t have an internal training program or one that was performing the way it should. The first obstacle is that they don’t prioritize it and always feel there is something that is more important; it is certainly isn’t at the top of the dealer’s list. Some of these organizations have fixed ops directors or variable ops directors who are running between a number of stores, but I always hear the same answers: “Were just so busy that I can’t afford to take the time” or “We generally do it on Fridays or Saturdays and that’s the only time we have everyone here.” There are a lot of excuses, but very few true reasons. They just don’t prioritize it. 

The second issue is the fact that they really don’t have the proper training material. You can buy all sorts of training materials, but if you don’t know how to put it in play and put together an organized plan, it doesn’t do you any good. I actually found a video training series a few years ago from a well-known trainer, and it was sitting on the dealer’s shelf where it had been opened and never used for years. I asked why and was told that it was too overwhelming when they opened it. I rolled my eyes and said, “What do you mean?” 

“Well, we just didn’t know how to roll it out. We just developed our own training program instead,” he responded. 

“And how’s that going?” I asked 

“Well,” they said, “we never got that rolled out either.” 

They just didn’t have the material prepared to be able to teach what they feel they need to teach. 

Where do you see the most deficiencies in the training programs with the dealer-clients that you and your team have worked with? 

Greg Goebel: There are a couple of things that immediately come to mind. Our human resources division, which is headed by COO Harlene Doane, has seen some of the worst training programs, and the most botched are related to onboarding. As a company, you have one chance to make a great first impression. Many new hires are given what I call the four sees of training: See your desk, see your phone, see your worksheet, and see you later. They aren’t given the basics of how to use the phone system or where to park, or even shown the dealership or get introduced to the key employees. It’s generally atrocious. On the first day, you need to make a great impression on a new employee because you want employee satisfaction, which is key, and that’s the only way to get it off to a good start. 

The second deficiency really runs back to what I said earlier — no one has been trained on how to train. A dealer may tell the GM, or the GM may go and tell another subordinate manager that the employees need to be trained, so go do it. Without having been trained on how to train, they generally do it poorly and do it the way they were trained. They follow the steps of whomever trained them, but they might not have been trained on how to do it. It’s a very tough cycle to break. They don’t understand the difference between training and coaching. Training is teaching someone something new, while coaching is helping someone to do something better that has been previously taught. Think about a time out in a basketball game. All the players have been taught how to play, but they are being coached during a huddle on how to execute it better. 

Finally, dealers use video platforms for training like a penalty box in a hockey game. They’ll see someone do something poorly and send them to their video training, but they don’t have any plan to help them apply what they have just spent their time watching. They lack the ability to integrate the lesson into their own dealership. I like the use of video and this type of training, but it has to be done with a manager present that can stop the video or field questions after it is over on how that information needs to be applied in their stores. 

Many dealers suffer from high turn over in F&I. What do think are the causes, and what do you think dealers could do to slow this down?

John Tabar: Turnover in F&I and throughout the dealership is costing dealers hundreds of thousand of dollars a year, and if it’s a large group, probably millions of dollars a year. The last time I looked, F&I turnover across the country was 37%, and that’s a big number considering how F&I and that role contribute to a dealership’s profitability, and also how it could affect risk in the dealership from a compliance perspective. 

The other thing about turnover is that it’s a hidden expense. It doesn’t show up on the PNL, it doesn’t show up at dealer-20 meetings when we’re sitting there looking at our composites. But it’s there and it’s a real number. I think a lot of it is old-fashioned burnout and stress. When you look at the things that cause burnout, whether its in F&I or just about any job, they include long hours, heavy workload, lack of control, job insecurity, and conflicting workplace, which kind of sounds like an F&I job description. Dealerships that enjoy low turnover and have a stable workforce all share some similar successful traits. They usually have enlightened management that supports not only their F&I managers but all employees, and they do that through clear communication on expectations, goals, objectives, daily cross role accountability, and meetings on process. They believe in the training and development of their people, and by that investment, it encourages their employees and F&I managers that there is a track to follow to elevate their career. They also incorporate comp plans that motivate and reward performance. So if you have a turnover problem, I would really take a look at how your dealership stacks up against some of the best practices I mentioned. 

What has 2020 taught us about the financial services department? 

Ritch Wheeler: This past year has taught us that finance managers and the finance services department have become the most important part of the dealership, at least in the front end. If you think about how we explored 2020, how deals progressed and how transactions took place, the only person at the dealership that was capable of moving all the pieces of the puzzle together and completing that deal was the financial services manager. You can’t just ask an F&I manager to do something they’ve never done before without trying to give them some sort of roadmap to do it. Over the course of 2020, we had to walk them down the path: How can we get in front of a customer virtually or digitally? How can we put contracts in front of them? How can we do presentations? How can we do a manufacturer's limited warranty review? 

I think 2020 showed us that our finance managers were able to improvise, adapt and overcome. With a little bit of training and a bit of coaching — not just training of how to do it — they took hold of that we saw numbers and really soared to new heights. 

I think 2020 showed us two things. First, our finance managers are the critical component of the front end of the car dealership. Secondly, it showed us is that we need to invest more. Traditionally, we have invested a lot in sales training, but we invest a tiny bit in sales manager training and we don’t invest much at all in finance manager training other than sending them to F&I school. That’s even somewhat limited, because you don’t want them out of the dealership for five days, you don’t want to put them on an airplane, and you don’t want to put them up in a hotel. We just haven’t traditionally invested as much in our finance managers as we have in our other employees, but we should be investing the most in them because, at this point, they are the most critical employee. At AFAS, one of the things we’ve done is create two additional levels of FI school. We go from our Professionals Level, to our Masters Level, to the Masters Elite Level, because we realized that we’ve got to continue to push the envelope with the finance managers. And they’ve proven the ROI when you do. 

I would say that 2020 has showed us that the finance department is the most critical in the front end of a dealership, and because it’s the most important department, we need to invest the money and the resources in getting them trained to take advantage of that. 

If you could give dealers one thing to improve their F&I performance, what would it be?

John Tabar: I think the obvious answer is more training, but let me give you the less obvious answer. I would like to see dealers stop keeping F&I products a secret until the customer comes in for delivery. In our society, we are all used to getting the information we need, instantly. I mean Google is a verb now. At a conference, a speaker once said that the website used to be an extension of the dealership, but now the dealership is an extension of the website. I would like to see that start to happen. All the data I read says that people are more open to the products we offer in F&I, now more than ever. They have an open mind about it. If the dealer really wants to improve F&I performance, a simple and unique way to do that would be to put more information about the F&I products on their website — not selling information, just telling information. Something that says what the product is, what it does, what it could do for you, and how to determine whether or not it’s right for you. That kind of approach to products on the website makes sense. 

They are looking at your website to see if you have a vehicle they are interested in, in your inventory. The process start is so much different than it used to be. They are selecting the inventory and looking at you as a dealer, and they are also going online and reading reviews. We wouldn’t even eat at a restaurant today if it didn’t have at least four stars, and now people are doing the same thing for the dealership. If you really want to give some horsepower to something like that, every time there is a claim paid in service, have your F&I manager give that person a call to follow up. It could be as simple as, “Hey I’m John from ABC Motors and I’m calling because I see you had a claim paid on your VSC you enrolled in a few years ago. I just wanted to make sure that everything went as promised.” 

The customer is going to say yes because you already know they had a good experience, and you’re just going to ask them, “Would you mind going on our website and giving us a review for the VSC, or the tire and wheel, or whatever product it was?”

Now, imagine if you’re looking at your website, they’ve found the car, and they are trying to determine if they should use you, so they are looking at reviews, and every fourth or fifth review is about a product that’s offered in F&I. People will start coming in and asking about those products, and you can have a good discussion based on that. If they do that, and its not very expensive or difficult to do, it would yield a big reward. 

How have you seen the special finance industry change and what should dealers be doing to stay current with the times?

Greg Goebel: Well, it’s a very volatile industry right now. I’ve been training special finance since 1998, and its not rocket science, nothing is a secret. Everything I have ever trained I have shared publicly. Even the things I taught back in 2008, 80% of it is still pertinent today. But what has changed dramatically over the last five years is the technology and the ability to submit deals. To stay current, always stay abreast and read anything the dealer publications are putting out. One of the best things is to communicate with the community and the auto finance companies you’re working with, and not necessarily the field employees, but the executives. I work with executives across most of the big auto finance companies, and by the time the message gets down to the field force, it goes through a few iterations, and it may not be the same message the executives would share. 

When I started special finance back in late 1989, the only way I learned was by communicating with the executives that I got to know very quickly. Here at DealerStong, we’ve been doing the benchmarks for the industry since 2004, and the use of technology has allowed us to import hundreds of thousands of transactions from dealer’s DMS systems, so we can really dial down into what those benchmarks and industry averages are and stay abreast of that. 

Has 2020 made the service department more or less important?

Ritch Wheeler: Dealers, vendors, dealership employees — everybody is wondering with this new digital environment that were all going to be playing, operating and doing business in, what is that going to do to our service department? We took the approach that the service department had to be more important, not less important. We started taking that approach about two years ago, long before COVID, just because we saw what was going on on the digital front. Think about the way customers do business in general. We buy our groceries online and they just simply put them in our trunk and we never walk in the store. We used to go to Starbucks and the whole experience was sitting in the café and drinking whatever kind of drink it was and you could pretend you were in Italy. Now people mobile order their drinks and just show up, pick it up, and walk out, and they never speak to anyone. We started realizing that we need to figure out a way to tie that consumer back to the dealership. If everything is done digitally and there’s less human interaction, less rapport building, and less relationship building, we’re going to stand a better chance as a dealership of losing that customer on their next transaction. That hasn’t changed. If a customer buys a car from you and they do their service work with you, they are going to be more likely to buy their next car from you. That’s just the way the math works. 

Not only is service important, it might now be more important than its ever been before. As a bunch of front end guys, we look at training and talk about training for F&I managers and sales managers, but the reality of it is, the department that might help us the most in retaining that customer has always partially been the service department. And now, more than ever, it is the service department, because that is the only department that they communicate with when they come back to the dealership. You simply can’t get your car serviced online; Amazon isn’t selling that yet. They’ve got to come back to the dealership to service their car or they’ve got to allow us to come pick it up and then deliver it once we’ve serviced it. Now that’s a new trend, but that’s a trend that dealers need to be aware of and understand and be engaged in. They need to understand that they need to do service appointments online. I hear people talk all the time about how traffic in car dealerships is down. But it’s not down, it’s just somewhere else. It’s not on your showroom floor, its on your computer. Just as many consumers are still shopping, maybe even more now than before, but you have to have a better virtual impression, because that is where your first impression is made. 

Most consumers are shopping online before they come in the store and seven out of 10 of those customers are going to your website before they go to your dealership. If that’s the case, they’ve already made a first impression about you before you’ve ever even met them. The same thing is happening with the service department. If we talk about the scope of training service advisors because they’re sort of our front line, are we training them on how to take care of the customer virtually, digitally, or in-person when they show up on the drive? Are we providing a faster, more transparent, better experience? Are we getting the customers in and out? And are we communicating with them through the methods they want to be communicated with? Are we offering pickup and delivery services? Are we offering an online scheduling platform that we actually use? 

I would say absolutely service is more important, and I would say that dealers that understand this invest in it and are going to be wildly successful moving forward, because it’s part of that entire experience that the customer is looking for. The customers have shown us that they want a personalized transaction that provides them with a world class experience. They are willing to start the process themselves online and self-discover our F&I products online, and they come into the dealership with a greater appetite because of that. But when they get to the dealership, we’ve got to take care of them. 

Originally posted on F&I and Showroom