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Successful F&I In Your Dealership
AGENDA
•    Brazil Culture/American Culture       •    A Cultura Brasileira/ A Cultura
                                                Americana
•    History of F&I in the U.S.            •    A História do F&I Nos EUA


•    Opportunity in F&I is as big as the   •    A Oportunidade em F & I é
     Blue Sky                                   ilimitada


•    Change                                •    Mudança


•    F&I and the Dealership                •    O F&I e a Concessionária


•    Implementation                        •    Implementação


•    Q&A                                   •    Perguntas e Repostas
PRESENTERS

                             •  Jim McDavid
                                   •  Founder/CEO/VP
                                            •  The McDavid Group
                                            •  MobiDrives
                                            •  Rocky Top Chrysler Dodge Jeep



   •  Mario Murgado
       •  Owner
           •  Brickell Motors - Miami, FL




                               •  J.R. Caporal
                                     •  CEO/Owner
                                             •  MegaDealer Network Development
                                             •  Compre Já Seminovos
BRAZIL CULTURE X
A CULTURA AMERICANA

A Cultura Brasileira   A Cultura Americana
BRAZIL CULTURE
X A CULTURA AMERICANA
BRAZIL CULTURE X
A CULTURA AMERICANA

        Although we pursue the common financial
        goals, there are a number of differences in how
        we approach our business models.

        •    Credit submission/approval & spot delivery
        •    Fixed Operations
        •    Demonstrators
        •    The delivery
BRAZIL CULTURE A CULTURA
AMERICANA

         Although we pursue the common financial
         goals, there are a number of differences in how
         we approach our business models.

         •    Credit submission/approval & spot delivery
         •    Fixed Operations
         •    Demonstrators
         •    The delivery
         •    And YES, F&I Process
Customer Dynamics: Auto Retail 3.0
                           Retail Evolution is Accelerating
             Retail 1.0                     Retail 2.0                       Retail 3.0




         The first 110 years               1995 to 2007                      2008 to…


    •    Relative retail process   §  Internet comes to retail;    §  iPhones, Smartphones and
         stasis; Customers             widely adopted by shoppers       Apps create fast, mobile
         tended to shop closest                                         knowledge creates greater
         dealer                    §  Shift in power from the          transparency
    •    Experience dominated          dealership to customers
         by the dealer                                              §  Social media furthers
                                                                        customer power in
                                                                        shopping

                                                                         JD Powers
                                                                          AND ASSOCIATES
9
HISTORY of F&I in U.S.
A CULTURA AMERICANA

F&I Then
•  Began in early 60’s*
•  One or two products
•  12 month factory
   warranty
•  Limited connectivity to
   gain access to credit
   ratings for approval
•  Paperwork was time
   consuming
A CULTURA AMERICANA
F&I Now
•  Many products/insurance
•  Dealers tailor offerings
•  Average factory warranty is
   36/36
•  Some factory warranty cover
   60/60
•  Many systems to integrate
   lenders
•  Paperwork completed in minutes
   (Printing)
A CULTURA AMERICANA

F&I Now
•  50 Years of trial and error
•  F&I Methods have
   evolved
•  F&I Products are driven
   to engage and protect the
   customers
•  The “sell at all cost”
   mentality has given way
   to “retain the customer”
OPPORTUNITY IN F&I
           •  Financial Impact

           •  Sales Process + F&I Process = Customer Satisfaction

           •  Customer Satisfaction = Customer Retention
        	
                 DSB	
  YTD	
  %	
     2011%	
     AVG.	
  PRU	
   2011	
  P/Totals	
  2011	
  I/Totals	
   2012	
  Goals	
   2012	
  Goals	
   2012	
  P/Goals	
  
    Extended	
  
    Warranty	
                  52%	
             44%	
         $510	
             740	
           $377,644	
            55%	
          $505,226	
              990	
  
Maintenance	
                    3%	
              5%	
         $195	
              76	
           $14,873	
             10%	
           $35,226	
              180	
  
        GAP	
                   26%	
             26%	
         $415	
             339	
           $140,820	
            35%	
          $261,702	
              630	
  
        PVR	
                 $1,100	
            $981	
           	
                	
              $981.	
               	
            $1,161	
  
Units	
  Sold	
  N/U	
           309	
            1672	
           	
                	
               1672	
               	
              1800	
                 	
  
  F&I	
  Income	
           $339,988	
   $1,640,273	
              	
                	
          $1,640,273	
              	
         $2,090,511	
                	
  
OPPORTUNITY IN F&I
•  Controlling the Customer

•  Controlling the Sale

•  Retention Products

•  And YES, Making Money
CHANGE

•  Leveraging the U.S. Experience Into the Brazilian Culture

•  The “Right Change” is “Good Change”
•  Change requires Dealer Commitment

•  Change requires Perseverance

•  Everyone must see the ‘The Win’ in change
        •  Customers
        •  Salesman
        •  Managers
        •  Dealer
F&I and the Dealership

•  Sales – F&I – Service
•  The Art of ‘Controlling the Customer’
•  Maximizing Dealership Income
•  F&I Process
        •  One stop shop
•  Products should benefit both the customer and the dealer
        •  Provide products that bring value to the customer
        •  Provide products that drive the customer back to the dealership for their servicing
           needs
•  The importance of Pay Plans & Incentives
Implementation
How do you Implement a successful F&I department in
your dealership?
• Starts with ‘Dealer Commitment’
• Management Buy-In
• Right People – Right Position – Right Process
• Benchmarking
• Training and Ongoing Support
• Setting a defined Time-Line (30 -60 -90 days)
• Inspect What You Expect
• Did I mention ‘DEALER COMMITMENT’
RECAP
       Successful F&I in your dealership
Implementing a successful F&I Department
provides immediate:

•  Impact on Gross & Net Profit

•  Long-Term Customer retention

•  Additional Service Traffic

•  Improved Customer Satisfaction

•  Control of your customer
Q&A PANEL
•    Jim McDavid - Founder / CEO
      The McDavid Group and MobiDrives
       Rocky Top Chrysler Jeep Dodge

•    Mario Murgado – Owner
      Brickell Honda, Buick and GMC



•    J.R. Caporal – CEO
      MegaDealer Network Development



•    Jorge Moas – CEO
      Moas Automotive Consulting



•    John Leaver – EVP/COO
      The McDavid Group and MobiDrives
THANK YOU

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The McDavid Group - NADA

  • 1. Successful F&I In Your Dealership
  • 2. AGENDA •  Brazil Culture/American Culture •  A Cultura Brasileira/ A Cultura Americana •  History of F&I in the U.S. •  A História do F&I Nos EUA •  Opportunity in F&I is as big as the •  A Oportunidade em F & I é Blue Sky ilimitada •  Change •  Mudança •  F&I and the Dealership •  O F&I e a Concessionária •  Implementation •  Implementação •  Q&A •  Perguntas e Repostas
  • 3. PRESENTERS •  Jim McDavid •  Founder/CEO/VP •  The McDavid Group •  MobiDrives •  Rocky Top Chrysler Dodge Jeep •  Mario Murgado •  Owner •  Brickell Motors - Miami, FL •  J.R. Caporal •  CEO/Owner •  MegaDealer Network Development •  Compre Já Seminovos
  • 4. BRAZIL CULTURE X A CULTURA AMERICANA A Cultura Brasileira A Cultura Americana
  • 5. BRAZIL CULTURE X A CULTURA AMERICANA
  • 6. BRAZIL CULTURE X A CULTURA AMERICANA Although we pursue the common financial goals, there are a number of differences in how we approach our business models. •  Credit submission/approval & spot delivery •  Fixed Operations •  Demonstrators •  The delivery
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  • 8. BRAZIL CULTURE A CULTURA AMERICANA Although we pursue the common financial goals, there are a number of differences in how we approach our business models. •  Credit submission/approval & spot delivery •  Fixed Operations •  Demonstrators •  The delivery •  And YES, F&I Process
  • 9. Customer Dynamics: Auto Retail 3.0 Retail Evolution is Accelerating Retail 1.0 Retail 2.0 Retail 3.0 The first 110 years 1995 to 2007 2008 to… •  Relative retail process §  Internet comes to retail; §  iPhones, Smartphones and stasis; Customers widely adopted by shoppers Apps create fast, mobile tended to shop closest knowledge creates greater dealer §  Shift in power from the transparency •  Experience dominated dealership to customers by the dealer §  Social media furthers customer power in shopping JD Powers AND ASSOCIATES 9
  • 10. HISTORY of F&I in U.S.
  • 11. A CULTURA AMERICANA F&I Then •  Began in early 60’s* •  One or two products •  12 month factory warranty •  Limited connectivity to gain access to credit ratings for approval •  Paperwork was time consuming
  • 12. A CULTURA AMERICANA F&I Now •  Many products/insurance •  Dealers tailor offerings •  Average factory warranty is 36/36 •  Some factory warranty cover 60/60 •  Many systems to integrate lenders •  Paperwork completed in minutes (Printing)
  • 13. A CULTURA AMERICANA F&I Now •  50 Years of trial and error •  F&I Methods have evolved •  F&I Products are driven to engage and protect the customers •  The “sell at all cost” mentality has given way to “retain the customer”
  • 14. OPPORTUNITY IN F&I •  Financial Impact •  Sales Process + F&I Process = Customer Satisfaction •  Customer Satisfaction = Customer Retention   DSB  YTD  %   2011%   AVG.  PRU   2011  P/Totals  2011  I/Totals   2012  Goals   2012  Goals   2012  P/Goals   Extended   Warranty   52%   44%   $510   740   $377,644   55%   $505,226   990   Maintenance   3%   5%   $195   76   $14,873   10%   $35,226   180   GAP   26%   26%   $415   339   $140,820   35%   $261,702   630   PVR   $1,100   $981       $981.     $1,161   Units  Sold  N/U   309   1672       1672     1800     F&I  Income   $339,988   $1,640,273       $1,640,273     $2,090,511    
  • 15. OPPORTUNITY IN F&I •  Controlling the Customer •  Controlling the Sale •  Retention Products •  And YES, Making Money
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  • 18. CHANGE •  Leveraging the U.S. Experience Into the Brazilian Culture •  The “Right Change” is “Good Change” •  Change requires Dealer Commitment •  Change requires Perseverance •  Everyone must see the ‘The Win’ in change •  Customers •  Salesman •  Managers •  Dealer
  • 19. F&I and the Dealership •  Sales – F&I – Service •  The Art of ‘Controlling the Customer’ •  Maximizing Dealership Income •  F&I Process •  One stop shop •  Products should benefit both the customer and the dealer •  Provide products that bring value to the customer •  Provide products that drive the customer back to the dealership for their servicing needs •  The importance of Pay Plans & Incentives
  • 20. Implementation How do you Implement a successful F&I department in your dealership? • Starts with ‘Dealer Commitment’ • Management Buy-In • Right People – Right Position – Right Process • Benchmarking • Training and Ongoing Support • Setting a defined Time-Line (30 -60 -90 days) • Inspect What You Expect • Did I mention ‘DEALER COMMITMENT’
  • 21. RECAP Successful F&I in your dealership Implementing a successful F&I Department provides immediate: •  Impact on Gross & Net Profit •  Long-Term Customer retention •  Additional Service Traffic •  Improved Customer Satisfaction •  Control of your customer
  • 22. Q&A PANEL •  Jim McDavid - Founder / CEO The McDavid Group and MobiDrives Rocky Top Chrysler Jeep Dodge •  Mario Murgado – Owner Brickell Honda, Buick and GMC •  J.R. Caporal – CEO MegaDealer Network Development •  Jorge Moas – CEO Moas Automotive Consulting •  John Leaver – EVP/COO The McDavid Group and MobiDrives