What You Should Know About Outsourcing a Finance Department
We spend a lot of time on our blog explaining the benefits of moving to an outsourced finance and insurance (F&I) model for your dealership. We explain how it works, how it will positively impact your business, and more. Here, we will go in a slightly different direction: Why is outsourcing the better option? Put another way: What will the financial benefits mean for you, your dealership, your employees, and your customers?
F&I Companies—An Overview
An F&I company is another term for an outsourced finance department. This type of company accesses loan amounts for you, so you don’t have to worry about managing your dealership’s finances in-house. F&I companies often scale their clients’ services up and down throughout the year, so they provide more services during peak sales season and reduce them during the off season. Since they devote all their services to accessing loans, they can often get more competitive rates and lower interests on the loans they procure for your dealership.
Additionally, an F&I company becomes your dealership’s single source for loans. Compare that to managing your own financing department. When you have an in-house financing department, it involves multiple finance team members trying to get loans from banks or credit unions. They end up with multiple loan sources that may offer different loan terms and interest rates. An F&I company gives you a single loan source that provides a steady cash flow for your boat or RV dealership. That steady flow allows you to conduct transactions and close deals more quickly and effectively.
The Advantages of Outsourced RV and Boat Dealer Financing
The men and women who make up your sales staff are fundamentally committed to doing one thing: showing and selling RVs, boats, campers, trailers, and more. Adding financing, insurance, warranty sales, and more to the list goes beyond the scope of what their job ought to be. Now, you might be asking yourself, “Isn’t it more cost effective to have one person driving the entire process from beginning to end?”
The problem is that while your sales staff may be incredibly talented, there is only so much one person can handle. What they do best is selling on the showroom floor; taking them off the floor to sit in an office to manage lender relationships and secure financing is not an effective use of their time.
Instead, your staff can make the sale and perform a seamless handoff to the team at Finance Solution. The process can be integrated so closely with your operation that the customer won’t feel like they’re being passed around. Then, you can move on to the next potential sale.
Your sales team can do their best work—what they’ve trained and practiced for—and improve your bottom line only when they are allowed to focus on the task at hand.
Why Outsource Dealer Financing vs Bank Financing?
We’ve gone through why it’s best for your dealership and your salespeople to outsource your F&I services, but what about the customers themselves?
Finance Solution was started in order to find the best way to finance vehicles for mission trips around the United States. That was our “why” for getting into the industry. Everyone’s purpose is different and, even if that purpose is simply to secure a healthy bottom line and build a business, the “why” comes down to the customer.
Outsourcing your F&I is one of the fastest, most efficient ways to improve the customer experience. In fact, our partners end up receiving more positive customer reviews after signing on, which shows that over time more customers enjoy working with our partners.
If you’re looking for referrals and even repeat business, it’s best if everyone is happy.
Outsourcing your F&I with Finance Solution does more than just boost your bottom line. We’re improving dealerships on a fundamental level.
If you’re currently managing F&I products and services in house, we’re not pressuring you to make a switch to our services. However, it’s worth knowing your options.
One of the hallmarks of our service is how flexible we are. So, whether you’re entering a particularly busy month and you need some outside support, or you are looking for a reliable, full-time solution, we’re here to help.
Give us a call today, and we’ll be happy to show you what we’ve got.