The McDavid Group - NADA

Successful F&I In Your Dealership

AGENDA

•  Brazil Culture/American Culture

•  History of F&I in the U.S.

•  Opportunity in F&I is as big as the Blue Sky

•  Change

•  F&I and the Dealership

•  Implementation

•  Q&A

•  A Cultura Brasileira/ A Cultura Americana

•  A História do F&I Nos EUA

•  A Oportunidade em F & I é ilimitada

•  Mudança

•  O F&I e a Concessionária

•  Implementação

•  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

9

Retail 2.0 Retail 3.0

The first 110 years 1995 to 2007 2008 to…

•  Relative retail process stasis; Customers tended to shop closest dealer

•  Experience dominated by the dealer

§  Internet comes to retail; widely adopted by shoppers

§  Shift in power from the dealership to customers

§  iPhones, Smartphones and Apps create fast, mobile knowledge creates greater transparency

§  Social media furthers customer power in shopping

Retail 1.0

JD Powers

AND ASSOCIATES

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