Special Finance is back!

Transcription

1 Special Finance is back! Maximize your dealership s opportunities Learn the lenders, inventory, marketing and sales process your store needs to deliver and fund those special finance prospects. John Palmer, CEO ProMax Unlimited and ProCredit Express [email protected] ProMax Unlimited ProCredit Express

2 Special Finance is over 50% of the market! Source: National Credit Reporting Agency

3 The Special Finance market is becoming larger every year. Average credit bureau score last 5 years Source: National Credit Reporting Agency

4 Special Finance lending is back in Source: National Credit Reporting Agency

5 The Special Finance market opportunity for your store is much bigger than you think.

6 Percent of booked and unbooked applications by credit bureau ranges

7 Free Market Analysis To get a free market analysis for your dealership call and ask for Amy or your request to [email protected] Example: Lost Sales and Special Finance Opportunities Mike Reichenback Ford Florence, SC - 20 Mile Radius Last 30 days CB Score Range Total number of potential subprime prospects: 499 % of Total without a booked Auto Loan: 88% Prospects who have not yet booked a vehicle: 439

8 How do you turn those Special Finance Prospects into Customers?

9 To be successful in Special Finance a dealership needs: The right mix of lenders The correct inventory Marketing tools to generate leads without detracting from stores image A blended sales process that maximizes every opportunity The latest in technology and software tools available

10 First - Select the right mix of Lenders

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20 Noted author, speaker, trainer & consultant, Greg Goebel is a former 18 yr dealer, with focus on Special Finance (subprime auto) since Contact Greg FL Office FL: Fax [email protected]

21 Next- Make sure you have the correct inventory. What works best for the prime side of your business may be just the opposite of what you need to be successful in Special Finance. 50% of the gross on Special Finance deals is based on the Spread the other 50% on how you work the deal.

22 First analyze your current inventory for Special Finance opportunities This is one of many customized reports you can run in ProMax Unlimited in just a couple of seconds. It would take your used car manager hours and hours to create this report by hand! This This actual actual dealer dealer needs needs some some good good SF SF vehicles! vehicles!

23 If your current inventory analysis shows you need vehicles Go to the auction with a list of vehicles to buy for your Special Finance customers

24 Before your used car manager goes to the auction have him go to to generate a list of vehicles perfect for special finance to bid on. Actual Vehicles with Average Wholesale values $15,000 or less, under 80,000 miles and payments under $399, that offer the highest profit potentials in Special Finance

25 While most dealers have inventory automatically posted online, there is nothing that states or requires you to post your entire inventory. If you buy inventory specifically for your Special Finance prospects, you can simply leave those vehicles off the Internet, so that you don t get locked into unworkable deals structures. Of course you can sell those vehicles to regular retail customers, but most dealers will see little benefit in pricing every Chevrolet Impala with prime credit pricing models.

26 Marketing and advertising tools to generate leads without detracting Trigger leads Direct Mail from your stores image. Fresh BK leads both open and discharged A unique website directly geared to your sub-prime customers 3 rd party Internet leads References and referrals Prior unfinanceable showroom traffic

27 Find out who shopped your competitors yesterday! Do you want to know who applied for an auto loan YESTERDAY within 30 miles of your dealership with a credit score between ? How it works: When a dealership, finance company, credit union or bank pulls a TransUnion, Equifax, or Experian credit bureau on a consumer the bureau is flagged with an auto inquiry. If the consumer falls within the radius and CB score range you have selected then your dealership will be given the name, address and phone number (usually about 30% have phone numbers after scrubbed against the do-not-call list). The next day a letter will be mailed with an offer of credit backed by a lender of permissible purpose. Average response rates vary between 5% and 10 %. Call today:

28 Special Finance Direct Mail Live targeted score ranges - Be sure you target consumer credit scores that fit the qualifications of your finance dept. Make sure the credit data you purchase is current not historic. Pre-qualified offers of credit backed by lender of permissible purpose. Make sure your letters are compliant and backed by a lender. Blind non-directive mail By having the prospects go to a website, 800 number or BDC you can effectively track your results, not brand your dealership sub-prime or discourage them from responding to your message because they perceive you don t carry the vehicles they are interested in. Most venders will provide you with a CRM for tracking purposes if you don t have your own. In addition, most can provide you with toll free hotlines and secure websites for respondents. Simple message no checks A lot of attorney generals out there consider sending a check to be non-compliant. Make sure your message is simple with no Free-bees, gimmicks or give-a-ways you only want people to respond that need your assistance and want to buy a vehicle. Make sure you have exclusivity You don t want your competition sending out the same message. Make sure you do a minimum 60 day suppression You don t want to continuously market the same prospects with the same message.

29 ProMail The Best Sub-Prime Direct Marketing Program Available ProMail response rates are more than double the national average No gifts, no gimmicks, no giveaways Every respondent is interested in one thing Purchasing a vehicle from you. ProMail offers many extra benefits at no extra charge Toll-Free hotline & secure credit application web site ProMax Unlimited CRM guarantees tracking of every lead Choose the targeted list that s s best for you Credit Score Bankruptcy ProMail exclusive BHPH targeted lists Call today:

30 Fresh BK leads both open and discharged. Through the first six months of 2010, consumer bankruptcy filings increased 14% over the same period last year. The American Bankruptcy Institute expects another 1.6 million bankruptcy filings by the end of the year.

31 Almost all Special Finance lenders will approve and fund discharged bankruptcies. Some lenders will also approve recently filed bankruptcies and fund them on a non recourse basis after the 341 meeting but before the discharge. The most successful approach by the most successful dealer is as follows: Have the appropriate lenders for any opportunity Get fresh weekly lists of filings, 341 meetings and discharges Send out 1 st letter at time of filing Send 2 nd letter after the 341 meeting Send 3 rd letter after the discharge 3 more letters every 2 weeks if prospect still hasn t purchased

32 Call today:

33 Dealerships are having great success with a Special Finance website With sub-prime financing making a comeback make sure to take advantage of all people shopping online regardless of their credit situation. It s not just people with good credit that use the Internet. Pretty much every dealership has a website but how many dealerships have a separate & unique website for the sub-prime customer? A special finance website allows the dealership to customize a separate website which can be used for all advertising geared towards the subprime customer. Depending on the advertising philosophy of the dealership this website can be advertised blindly or can be advertised through dealership name branding. You can t manage what you can t measure. By adding a tracking number to the website you will be able to track all responses forms submitted and calls generated.

34 The dealership below, is proof of how successful it can be to utilize a separate Special Finance website. Through their advertising they are generating on a consistent basis between leads each month and closing 35%-50% of them!

35 ProMax Special Finance Websites High quality online leads Closing ratios as high as 35% Full Integration with ProMax Custom designed sites offer the following: Create your departments own online identity Generate leads specifically for your Special Finance department No more having to share leads and a website with the rest of the dealership Lead Management software Video display Secure Credit Applications Auto Responder capabilities To see an example visit Call today:

36 ProLeads Internet leads to increase your sales and profits All leads can be sent directly into your ProMax Unlimited All leads are exclusive to your dealership You select the radius from your dealership to receive leads No advertising costs or worrying how, where, and when to advertise Pay for only the leads you receive Track and work all leads in ProMax Unlimted Choose the number of leads you would like to receive No monthly or sign up fees or long term contract We deliver name, address, phone, DOB, SS#, income, employer name, time on job, time at residence and address (when available) Call today:

37 References & Referrals People with Special Finance needs usually have friends with Special Finance needs Birds of a feather, do indeed flock together. Most people with really bad credit just assume a new car dealer can t help them and think BHPH is the only answer This is a totally wrong assumption.

38 Send out a letter to every reference on your Special Finance customer s credit application letting them know they were a reference and that you offer credit for any situation perfectly legal. ProMax Unlimited can do this for you with our exclusive automated follow up system. One dealer I know sells 10 cars a month this way with less than $500 a month in ad costs! On every outbound and inbound call that is Special Finance oriented ask for 2 references at the end of the call with training and skill, salespeople will average one per call.

39 Prior Unfinanceable Showroom Traffic You ve spent thousands and thousands of dollars getting prospects into your showroom over the last few months that you could not get financed.

40 The most successful dealers follow up on these people in 2 ways: 1. They flag them in their CRM to call them again in 3 months to see if they are still at the same job, address, have more money to put down, a cosigner, etc. 2. They put them in a database managed by TransUnion that monitors their credit on an hourly basis until it hits a level designated by dealer, then calls them, sends them a letter and an with the good news!

41 Call today:

42 Call Manager Call Manager Every lead generation product that ProMax offers includes a Free Call Manager toll-free number to track and record every call and measure the effectiveness of each campaign. Incoming calls can be imported directly into ProMax creating a new lead. You will also be notified through ProMax s Message Center of any missed calls.

43 A blended sales process that maximizes every opportunity No separate SF department Qualify prospect early Work the deal backwards Close the selected vehicle with alternate choice close Use the new Risk Based Pricing exception notice as a great closing tool Manage your results by lead source and CB score range

44 Qualify all showroom traffic early Two Types: 1. Appointments from SF marketing efforts 2. Walk-in Traffic

45 Appointments - Take appointments directly to office and fill out a complete credit application. Explain to customer you and your manager will pick out 3 vehicles for them to choose from that will fit their needs and help re-establish their credit. Walk-in traffic Much bigger than you think Analysis CB scores pulled in the last month. CB Score Range

46 Qualify in one of two ways: 1. Qualifying questions such as: Do you intend to finance, lease or pay cash for your next vehicle? On a scale of 1-5 with 5 being great, how would you rate your credit? Who are you currently making payment to? Who was your last car financed through? Are you here to take advantage of 0% APR financing for customers with preferred credit? 2. Use a prescreen tool that requires just a name and address, with no social security number or customer signature or approval to get a tight credit bureau score range on customers with 1 10 tiers. If customer fits Special Finance criteria take to office to fill out complete application and see manager to come back with a selection of 3 vehicles. Never let a Special Finance customer pick out their own car!

47 Instant Screen allows you to get a scored credit tier and prequalification for all of your showroom traffic, phone-ups, and Internet leads with just a name and address or a swipe of a drivers license with NO social security number or permission required. Call today:

48 Work the deal backwards A manager needs to review the credit application and credit bureau to get an idea of appropriate lenders. He then needs to calculate the top grossing combinations of vehicles and lenders and select 3 vehicles which the salesperson can show the prospect. This can be done in just seconds using ProMax Unlimited and its as easy as 1-2-3! 1 1 Enter the customer information in the special finance search and d click the Calculate button

49 Work the deal backwards 2- In just 4 or 5 seconds ProMax Unlimited will calculate every combination of vehicles and lenders you have, and the following comparison screen will appear r sorting the results by profit, of course!

50 Work the deal backwards 3 - A list can be generated of the top 3 grossing vehicles in ProMax Unlimited and given to the salesperson to have the customer select one of the three.

51 Close the selected vehicle with an Alternate Choice close. Never give any customer an option of one choice but always 3 Here is an example of a good alternate choice worksheet created in ProMax Unlimited.

52 Use the new Risk Based Pricing Exception Notice requirement as a great closing tool. For any Special Finance customer with a payment or interest rate objection, the new Risk Based Pricing Exception notice required to be given out Jan.1 to any customer you pull a credit bureau on will be a wonderful closing tool. Call today:

53 Manage your results by lead source and CB score range Lead Management & Results Advertising & Sales Report

54 ProMax Unlimited not only handles Special Finance, but is your complete Front End Solution! ProMax Unlimited is a streamlined, fully integrated web-based program that can manage every aspect of your operation, from desking to CRM, inventory management, and much more. ProMax Unlimited performs the functions of lease software, special finance software, prospect and customer follow up software and inventory management software, all in one program. z

55 John Palmer, CEO ProMax Unlimited and ProCredit Express If you have any questions, comments or need help with Special Finance? You can contact me through our website at: Or call ext. 103