By Ron Martin
For product providers and administrators, the benefits of a menu go far beyond the additional products sold in the F&I department of auto dealerships. Menus provide an excellent medium for plug-in web services for product rates and bi-weekly payments. In addition, the menu can be an entry point to analytics that give providers and administrators the information they need to consult with their agents and dealer clients.
An electronic, web-based menu is also quite economical. Since the menu – in most cases – is already extracting information from the DMS, P&A companies reap the benefits without paying for the data themselves.
It is well-accepted throughout the industry that an electronic menu is an excellent closing tool for the F&I manager. It gives the staff flexibility to tailor their presentations to customers’ needs and wants, and, obviously, an effective F&I department means more product sales for P&A companies.
Menus are also transparent, which ensures that customers know what they are buying and sign off on their choices every time. F&I managers can show which products customers accepted and which ones they declined, including how much the declined products cost per month had they chosen them. This visual presentation provides one more chance to close an additional sale.
It is true that electronic menus can result in greater income for product providers and administrators, but additional product sales only scratch the surface of the benefits electronic menus can provide.Menu Makes Consuming Web Services Easier
The menu is the ideal place to plug in rates for vehicle service contracts and other products. Administrators go to great lengths to set the right rates for their products to ensure that they have the appropriate reserves come claim time.
Unfortunately, this means that a product pricing card – particularly for service contracts – can be upwards of 20 to 30 pages. Such large rate cards make it almost impossible for an F&I manager to get the rate right every time.
Electronic menus consume these rates rather easily. P&A companies can even build a web service that provides for filters so that dealers only get the programs they want. This is a much more efficient way of populating rates and the menu is the obvious medium to consume them.
Bi-weekly payments and amortization schedules also work nicely for plug-ins. The F&I menu can give a reliable bi-weekly payment even as the amount financed changes. Many bi-weekly payment providers are coming up with excellent information tools that are easily consumed by the menu.Extracting Data for Analytics
Many menus are able to extract information from the DMS, which is valuable for the product administrator. Would you like the ability to get answer to the following questions:
- Of the service contracts sold, how many were with your competitor?
- What is the average percentage of amount financed that GAP policies are sold on at your stores?
- What is the average profit markup of each product that a dealer sells?
These are just a few of the many statistics that you can learn from the information extracted for analytics.
The analytics can be rolled up to a variety of levels: “company, region, state, agent, group and dealer” is an example of the hierarchy that can be achieved. Custom reports can be designed based on the needs of your company, your agents and your dealer customers.Looking toward the Future
P&A companies and menu providers already have many synergies and that list should only grow in the future. The menu is the perfect entry point for the product provider because it is web-based and inexpensive.
The menu already serves as the hub for things like credit bureau connections, OFAC and Red Flag checks, bi-weekly payment options and product ratings. In relatively short order, all menus will allow for contracts and remittance forms to be reliably transferred electronically.
The key to making this all possible is open cooperation and standardization of each other’s technology. My hope is that the integration process will go much smoother than integration to the DMS did. The more efficient this process is, the easier it will be for all of us to provide our products and services to agents and dealers at the most affordable price.