The Third Essential Element: Special Finance Department Personnel You Can't Do It Without Good People

The Third in a Series of Eight Articles on the Eight Essential Elements of Special Finance

(Dedicated to my daughter who is still the best person that worked with me in Special Finance.)

People often blanche when I write that Personnel is the third essential element of Special Finance. They can accept commitment to the department is the most important element, but placing inventory ahead of personnel?

Yes, I insist that is the case, but to be fair, it is really more like “2-A” and “2-B” when you consider inventory and personnel. You certainly cannot do it without the people!

The problem with personnel is that it takes, er, people. Unfortunately, I have always said that you’ll never find a high-dive by the talent “pool” in the car business. The task of attracting and hiring good employees to your dealership is a never-ending process, and one that must be worked as diligently as attracting new customers.

I have a strong belief that you are better to look outside the industry to find quality people than to try to re-train retreads, I always suggest you go “shopping” for sales people.

It certainly worked for my organizations.

“Shopping?” Where do you shop for sales people? First of all, let’s define “who” it is that we are looking for. Give me someone with integrity, with, desire, the ability to learn, to follow instructions and to communicate well, and I can teach them to sell.

Next, you have to find that package in someone that is motivated to enter the retail car business. That is where it tends to get dicey.

So where do we “shop”? First of all, while many of us that have spent years in the business may agree that sometimes our hours are long, there are certainly other businesses that have much worse hours.

Think of the restaurant and hotel industries. When you get off work and go to dinner – there is still someone serving at your favorite restaurant.

Servers and hostesses have all been selected and trained to provide excellent customer service. Additionally, they must all be able to communicate well. Are there servers that have waited on you frequently and always delivered first rate service? If so, your hours have to be better, and I bet so is your pay.

Hotel clerks often must work 12 hour shifts, and for a variety of reasons, must be able to think on their feet when confronted with some awkward situations, while at the same time delivering first rate customer service. Again, better hours, better pay.

Also, think other retail stores. I couldn’t count the number of times I had managers asked to leave a Circuit City or Best Buy while recruiting a sales person, er, I mean shopping for a DVD player.

Essentially, anywhere you shop you are meeting a potential prospect. Keep a business card with you that states on the reverse – “I just want to let you know that you do a tremendous job. If you are ever interested in a career change with a higher earnings potential, please give me a call.”

You cannot find enough good people with good character and drive to fill your dealerships. Never quit looking.

How do you pay them? First, I suggest giving them a salary or guarantee for a period of 60 to 90 days minimum, while you provide them their initial training. Give them a reason to want to enter the car business.

Past that, pay them on Special Finance business the same way you compensate any other sales person. Some dealers make the mistake of reducing compensation on Special Finance deals. I ask, “does it really make sense to disincentivize the very thing you are trying to grow?”

Moving on to training, the most successful Special Finance dealers that I work with train their staffs daily. Yes, I said daily. I know all the reasons that you think you can’t. Somehow the dealership always makes time to make the daily bank deposit. Why is it so hard to make time to train? Is it less important?

How do you train? One method is to use a 20 – 30 minute meeting (it can be led by different people – even sales people) with a one page, three-hole punched agenda (for training manuals) with three to five bullet points outlined on it (leave room for notes). Cover your training points, and conclude. These are teaching and role playing sessions – not carping sessions, and not save-a-deal sessions. (Those are handled separately.)

What material do you use to teach with? For starters, you are holding in your hands a great source of material, as well as our online partner – AutoDealerDaily.com. It is filled with dealer and industry experts to learn from and teach with.

Of course, there is a multitude of training workshops you can send them to, but one in particular that I know is excellent.

Looking past the sales personnel, how about when it becomes time to add or replace the Special Finance manager? Where do you go to find that person.

I personally believe that you first look internally. Look to hire, develop and promote. You are looking for someone that has integrity, the ability to read and call credit as well as apply it to the various programs offered by the lenders. They also must be able to structure deals for maximum gross profit. They also need to be organized. These people don’t grow on trees.

Often that person may already be sitting in the F&I chair, or backing them up. It could be a sales manager or desk manager as well.

One note, I believe the ability to read and call credit is an innate ability. One of the most frustrating things I have attempted is to try to teach someone how to call credit.

I once had an intelligent F&I manager that had a Masters degree in business. No matter what, he could never grasp how to read a bureau, a customer statement and deduce whether, or which lender’s program might apply. If they have the ability, they will show it quickly. If not, look out.

What if you don’t have that person currently on staff to promote? Then you have to look outside. Generally, the person you are looking for isn’t going to be found at another dealership. Occasionally you will get lucky, but often it offers more pain than success.

There are two sources that offered great success and are available in most markets. Mortgage brokers (and even loan processors) generally possess the necessary credit skills as well as the communicative skills. It is not a significant issue to teach them “cars”.

The other source (sorry lenders) is the marketing representatives that call on you from the various finance companies. (Of course, it may not endear you to their buyers…) Many of them become weary of traveling, changing territories, or internal program changes. They almost always have the ability to read and call credit, as well as being able to talk the language – which can be an asset when selling a deal to a lender.

In any case, count on needing to expand their training – which will almost certainly stretch beyond the capabilities of most dealerships’ internal programs.

Once trained however, these individuals should have the potential to become strong managers – leading a significant profit center.

I admit that my search for personnel over the years may not have been “orthodox”, and yes, there were certainly mistakes. (If someone looks too good to be true, look harder - generally they are.) Overall, however, these methods provided my organizations with success that I could be proud of.

My two best pieces of advice for dealers and managers are simple: 1) Never quit looking for good people to attract into your organization – someone can be upgraded or someone is leaving; and 2) once you have someone onboard, be crystal clear about what their job description is, and provide them ongoing training to allow them to have the abilities to execute it.

Vol 2, Issue 3