If you were starting a new dealership tomorrow, who would be the first manager you’d hire? It wouldn’t be in sales or service for a top dealer in Louisiana who just opened a second store in northern Florida. Instead, Dixie RV SuperStore’s Greg Lala would choose a finance manager.
“I could easily put together a spreadsheet that tells my salespeople the least amount of money they’re allowed to sell a unit for. I could easily put together guidelines that tell them what they can and can’t do with a customer,” Lala says. “It’s the finance manager that ultimately gets the deal finished. We’ve proven it. The very first person we hired in our Florida store was the finance manager, not the sales manager. To me, that was the right way to do it.”
To say Lala, who began selling RVs in 1983 from a location in Hammond, La., values his finance and insurance (F&I) department is putting it mildly. It’s his belief the department is the nucleus of a dealership that last year sold more than 1,000 units. An essential element of its ability to get deals done is treating customers equally.
Offering a Full F&I Menu
“One thing our F&I managers do is offer everything to everyone, every time, without fail. That’s our policy. We menu sell,” says Dixie RV General Manager Stephen Guidry, whose store accounts for a significant amount of the motorized sales in the Pelican State. “That’s part of our success.”
Dixie RV’s three-member F&I staff, lead by Regina Wadsworth, senior finance manager, has been menu selling since 2000; the department transitioned to computer-based menus three years later. According to Lala, it’s something that goes beyond making the process easier for those seated on each side of the desk.
“It made it fair,” he says. “We make sure we offer them every product we have because we may think we know their needs, but we may not. As an example, there may be customers we feel don’t need GAP, but there may be something about their lifestyle that makes them need it, or they may just want it, so in fairness to every customer, we offer every product to them.”
The department’s top sellers are not unlike those of many dealers across the country: extended warranties, paint and fabric protection, followed by tire and wheel insurance and GAP insurance. Yet, unlike his competitors, Lala doesn’t believe his F&I staff should have selling foremost in their minds when dealing with customers.
“We don’t try to turn our finance department into a secondary sales lot,” he says. “The finance department is the piece that links the customer to the purchase. It’s our job to be an indirect lender for those lending companies and ensure that customer’s experience with his unit is good for as long as he has it. It should not be considered a second chance to sell them more accessories for their units.”
Customer Relationship Building Crucial
What’s valued first is getting to know those seated in front of her, Wadsworth says.
“I’ve never considered myself a sales person. I develop a relationship with my customers and they trust me. It’s a heartfelt sale. I am showing them the benefits of something I truly believe in and that translates to the customer,” she says. “They trust my opinion and I’m going to tell them exactly what’s best for them.”
Usually, sales and service seem to garner the majority of customer compliments, but Wadsworth says her department receives its share, too.
“I have a lot of customers who thank me for the information,” she says. “I think the key is making sure they’re aware of all the facts and what to expect, keeping in touch with them, and just giving them the information that they need. We’ve had numerous customers tell us this is the first pleasant finance experience they’ve had.”
Wadsworth says her approach to telling customers her job is to help find them the best deal.
“Some of them will come in with their own financing expectations,” Wadsworth says. “They think they’re going to get a better deal somewhere else. The way I deal with that is by saying, ‘You know what? I don’t blame you. I would check around myself. Why don’t you give me the opportunity to see how competitive I can be? You want to get the best deal.’”
It may seem like something out of Selling 101, but the keep-it-simple principal works.
“They at least give me the opportunity. A lot of times, they’ve got a preconceived notion,” she says. “If you put it to them that way, it’s hard to say no.”
Another part of the department’s foundation is knowledge of each lender’s requirements and what kinds of customers each will likely fund, Lala says.
“Regina and her team are really good about having the education to help them make a better decision,” he says. “There’s a common thread throughout the whole dealership: it’s all about training. We could be the smartest people in the world today. Six months from now, this whole business could change, and if we don’t keep up with it, we’ll never do the best job for the customer.”
Cultivating Relationships with Local Lenders
In light of an elusive economic recovery and continually declining consumer credit scores, Dixie RV finds itself using smaller, local lending sources, as well as subprime lenders, more often since the national banks have tightened loan requirements.
“Our local lenders here know that they are the key component to our business as well, so we have developed several very good relationships with these guys,” Wadsworth says. “Of course, we want to keep the relationships with the national lenders the strongest, but I like keeping in touch with them. You’re always going to have customers that fit better with the local lender than they do with a national lender, so keeping that relationship built up at all times gives you a whole lot more options the time comes you need them.”
Prime lenders such as Bank of America and Bank of the West pay particular attention to credit scores; the two won’t consider someone with a sub-700 score. It’s quite the opposite with local lenders.
“They’re a little bit more understanding of that number and you can work them better,” Wadsworth says. “The score’s the first factor and the biggest hurdle you have to cross, but there’s so much more to a credit file than just the score.”
Two additional factors considered now by lenders of every stripe are the debt to income and payment to income ratios, so getting deals bought is even trickier than it was just a few years ago.
“For a lot of customers who are retired, that’s their only note. You think you’ve got a lot of room there when that’s the only thing they have, but that’s not so, especially with the national lenders,” Wadsworth says. “Local lenders are a lot more understanding of that.”
One thing lenders down the street or across the country usually don’t tolerate is sloppy paperwork. To reduce the chances a form was incorrectly completed, the dealership has a procedure other stores could easily emulate.
“We do not allow anybody other than a manager to fill out a credit application,” Lala says. “We want to make sure what we’re writing on that application is correct and it’s stated in the correct manner.”
Even before a motorhome or towable hits Dixie RV’s 10,000-square-foot showroom (it sold about an equal number of each last year), a unique procedure occurs that was created to improve customer service.
“When it comes in from the factory and it’s time to prep that unit, that assistant service manager and his team owns that unit,” Lala says. “Those technicians know that unit inside and out. Once it becomes owned by customer number one, that customer is directly related to that ASM for the whole time they own it.”
The better his technicians know a unit, he says, the better they can take care of it. That means happy customers, not an easy task in the service game.
Paying to Keep Top Tech Talent
Keeping 18 technicians is no small feat, either, but Dixie RV has a formula for that, too.
“We have created an environment where techs come and stay long term,” Lala says. “We’ve got three techs right now who have been here over 15 years. We’ve got a number more who have been here a considerable long time.”
While Lala has instilled a family-like culture at the dealership, he’s also a realist and knows compensation speaks volumes.
“We only want to work with the best and our pay scale reflects it. When we can get that customer in, taken care of, and out of here, it’s worth it to us to pay that technician more money than anybody else will to make that customer happy, and we do,” he says.
Yet even a low turnover rate doesn’t mean Lala isn’t looking to hire more technicians.
“We currently have a 36-bay shop and the only reason that it’s not a 72-bay shop is because I can’t find twice as many technicians, because we certainly have the work for it,” he says. “We do indeed look for well-trained RV techs. We have brought in, and been very successful, with automobile technicians, but the one that we prefer the most is to bring in trainees and teach them our own way.”
Lala’s looking to hire a lot of technicians for the company’s second location, in the little town of Defuniak Springs, Fla., which opened in June. A former truck stop, the large site boasts 21 acres of blacktop and a 17,000-square-foot building along with a 10-bay shop. It was just a matter of timing; a nearby dealership recently went out of business, so Lala bought the site (vacant since 2008) and began offering units from a temporary building while renovation took place in the main structure. It’s been a relatively painless process.
“All we did was just bring a few people that would allow us to get our culture into that location ... What we want to make sure of is that a Whopper at one store tastes the same as it does at another. Other than that, we are pretty much hiring all new people,” he says. “It’s already proven to be a good move for us.”