F&I Express – Station #1 – Gearing Up

F&I Express – Station #1 – Gearing Up

This article begins a 12-part series, “The F&I Express.” Each article in the series will let the reader “board” the F&I profit train from one of 12 stations powering the engine of the RV sales locomotive. All aboard!

The F&I process is focused on sales and documentation. Dealers who are weighing the pros and cons of an in-house or out-sourced F&I function, need to consider cost, profit ratios, and liability before making a final decision.

Let’s see what it will take to set up your own F&I station.


The F&I office needs to be convenient for your customers as well as your sales manager. Since noise travels, an enclosed room works best for the privacy and security F&I requires. Whether you use dividers (such as steel case partitions) to create private spaces or build walls to create office space in the showroom, give your F&I office a door that locks, a ceiling, and heating and air conditioning.

Equipping and Furnishing the Office

You will need one desk and three chairs, along with a locking file cabinet or credenza to store unused forms, supplies and deals in progress. A fax machine with a dedicated telephone line is preferable. Add a computer with both a dot matrix and laser printer, and a crosscut paper shredder to complete the office set up. While the equipment does not need to be new, all items should be in good repair. After all, you will be asking for money in this environment.

The furniture should be clean and comfortable. Hang a mirror to reflect light, give the space an open feel, and remind the F&I professional to smile before greeting a new customer or picking up a telephone. Pictures should be framed (I recommend the Go RVing posters). The current trend is to keep family photos out of sight. Security companies are advising bankers to refrain from displaying anything that could lead someone to their homes or families.

Everything in the office that is visible to the customer should be professional, inoffensive, and serve to create a buying zone. Arrange point-of-sale items to be accessible without hampering the presentation. Ensure that forms are within the F&I producer’s reach.

The office environment needs to support the F&I process. Customers decide in the first seven to 17 seconds whether to listen to the presenter. Make certain the office adds to, rather than detracts from the business at hand.

Recording and Reporting

There are stand-alone F&I computers and computers integrated with the DMS (Dealer Management System). What do you want the F&I computer to do? Do you want to simply calculate contracts and print forms, or do you want the information entered to flow into accounting and service? Think about what type of reports you would like to see and set up your F&I computer system accordingly.

In order to be effective, senior management must have daily productivity reports from every department, especially F&I. The reports must include F&I production showing dollars, percentages of penetration, and sales department profitability as totals and averages. These reports need to reflect the various product lines, in addition to total new and total used. They must have a beginning date and ending date so that management can see month-to-date and year-to-date figures. The F&I report must also include pending finance deals. This report tracks all deals in progress from beginning through funding, as well as receipt of titles for the trades.


Internet access is essential for the F&I office, as many lenders transmit credit applications and credit decisions online. In the near future, F&I will be completing e-contracts. The lenders can direct you to sign up with a company to help this process.

Please note that lenders do not appreciate shot-gunned deals. Only one lender can fund the deal, and sending an application to multiple lenders at the same time increases the cost of doing business – for both the lender and the dealer, who may pay higher buy rates than the dealer next door, who refrains from the practice.


Since F&I personnel have access to all sorts of confidential customer information (often referred to as non-published information or NPI), the office must be locked when the F&I manager is not present. Consider investing in keyless locks. Pushing buttons is much easier than toting key rings.

Safeguarding non-published information about customers, as well as employees, is not optional. The dealership must comply with the Safeguards Rule of May 23, 2003, which involves doing the following:

1) Complete a risk assessment of the physical property – identify areas of potential security risk.
2) Write policies and procedures which employees will follow in order to secure customer and employee NPI (non-published information).
3) Appoint a person to implement the dealership policies and procedures.
4) Conduct a self-audit to test the policies and procedures.
5) Oversee vendors and their handling of your customers’ NPI.

You will need one set of Safeguards documentation per location. If you have multiple store locations, you need to make one set of documents accessible at each.

You also need to document that your employees have received instruction on NPI policies and procedures, and retain that documentation in your personnel files.

Although the specter of documentation and compliance issues associated with F&I seems overwhelming, it is a wise dealer who balances that detail with the success that comes from satisfied customers who bring repeat and referral business, adding to the bottom line profitability.

Our next stop in February will be Station No. 2 where we take a look at the process between Sales and F&I.

RV Executive Today, January 2007