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Dealing with Cash Buyers

Posted Nov 24th, 2015 in General

Dealing with Cash Buyers

This weekly newsletter by George Angus appeared in my inbox this weekend. I thought it was a great topic and wanted to share with all of you. Enjoy :)

Dealing With Cash Buyers

In last week’s message “Is it really Cash?” I discussed identifying customers who may be getting their financing somewhere but come to F&I as “cash” buyers. If you missed it, you can read it at

As a result of that message, I received several requests for what to do when we identify that it is really cash.

Today’s message is one that I have repeated several times but for those of you who have seen it before, a review is always good. And for those who have not, there might be some useful information that you can employ in dealing with true cash buyers.

First, can we convert cash buyers to our financing?

Well, yes, some of them. We have studied cash conversion techniques for the last 20 years. Every time someone claimed that they had a cash conversion that worked, somebody from our company was on an airplane to check it out. But the real results were always spotty, at best. The reality is that over the years, the traditional cash conversion techniques that have been taught in the marketplace just didn’t work.

Earlier this year I shared an easy, simple cash conversion technique that our F&I professionals are using to successfully convert 20-30% of cash buyers to financing. This technique was actually developed a few years ago in the field by some top F&I managers using the Package Option™ method. And the process is easy, simple, and only takes 5 minutes to do. Our current training program has added some new twists to the process, but this approach will still work with whatever process you are using.

It’s easy to learn, only takes a couple minutes to do, and even though it only works 20-30% of the time, it vastly outperforms any other cash conversion technique in the industry.

Try it. You just might convert a few of those cash buyers.

But what about the 70% to 80% who don’t convert?

Is there a way to sell more of those customers a service contract?

Well, there is one idea that is working for several of our top performing F&I departments that I will share with you. We didn't develop this approach. It was developed by some of our top performers and I am just passing along something that is working quite well for them.

Now, this technique takes a little preparation and some creativity on your part but our F&I managers are reporting an average of around 30% service contract penetration on "real" cash buyers using this approach, so it may be worth your time and effort to use it.

First, it is critically important that you go through the steps of the cash conversion process referred to above before presenting this approach.

What the dealers who are having success with this approach are doing is, first, going through the entire cash conversion presentation in step 2 of the Package Option™ menu, (or whatever menu you use).

Then, if they still want to pay cash, they offer whatever tangible packages they have in step 3.

Then, once the customer has clearly decided to stay with cash and has chosen whatever tangibles they do or don't want, they offer one more option, a list of discounted service contracts.

The sample below shows how dealerships present the options. They put together a separate piece of paper that looks almost like the "Today’s' Specials" sheet you get in a restaurant.

(A Microsoft Word template of this form can be downloaded at  

They just go through several term and mileage options and let the customer choose.

If you have already used the cash conversion process properly, you have already told the customer what the benefits of the service contracts are, so this presentation is very brief.

Don't sell! Just let them choose.

Easy, simple, and fast.

Try this and you will find that a surprising number of people, (as I said, an average of about 30%), will just pick one.

Hope you enjoyed this newsletter as much as I did.