How a Texas Honda store honed a hybrid sales/F&I system

Photo credit: BLOOMBERG

After four years of using a hybrid process for sales and F&I, First Texas Honda in Austin, Texas, has learned what works and what doesn’t, co-General Manager Andrea Baker says.

With the process, highly trained salespeople, dubbed Elite by the dealership, take customers through the entire sales and F&I process while less experienced sales employees hand off customers to an F&I manager.

The dealership has about 15 elites out of 40 salespeople, plus two traditional F&I managers. According to Baker, in 2013 the dealership was No. 1 out of three Honda dealerships in its market for F&I revenue per vehicle retailed and among the top 50 Honda dealerships in the nation. Four years ago, it was No. 3 in its market and below average nationwide, she says.

Baker shared six lessons learned from using a hybrid sales and F&I process during an Automotive News Access F&I Webinar last week titled “The F&I Handoff: Keep It, Drop It -- or Do Both?” and a follow-up phone interview.

Subscribers to Automotive News and Access F&I can replay the Webinar at

1. Recruit outside auto retail. Industry newcomers have fewer undesirable practices to unlearn, Baker said.

Baker says she would prefer to train an inexperienced or a fairly inexperienced salesperson to perform a hybrid sales and F&I role than transition an experienced F&I manager to perform the whole deal. “They would have a whole lot of bad habits,” Baker said.

2. Crawl before you walk. Start off with two of your best salespeople and gradually add more, Baker said.

She said First Texas Honda in one fell swoop switched about half the sales force to handling F&I too.

“Our F&I numbers plummeted,” she said. “We weren’t able to pay as much attention as we needed to so many of them all at the same time. So we scaled it back. We picked the strongest two and started with them.”

3. Postpone full-scale training. Don’t send newbies for full-on, offsite F&I training right away. They’ll get overwhelmed.

“That’s exactly what happened to me when I first started in finance,” Baker said. “They sent me straight to school and I maybe -- maybe -- comprehended 25 percent of it.”

Instead, First Texas Honda trains salespeople looking to step up to elite status onsite first, including using a trainer from an outside vendor.

Baker said salespeople get at least a month’s worth of training before they handle a customer in F&I. Would-be elites also practice giving F&I product presentations to dealership managers, she said. They go for offsite training only after a few months of F&I experience with customers.

4. Videotape all transactions. Videotapes make great training aids for F&I product presentations and for overcoming customer objections, Baker said. Videotaping also protects against situations in which customers dispute who said what during the transaction and whether all required legal disclosures were made, she said.

“Videoing transactions is huge, huge, huge,” Baker said. “If you don’t have [cameras] now, have them installed immediately. It is the single biggest boost of income you can do for your store.”

The dealership’s F&I trainer reviews videotapes with salespeople, she said.

5. Consider new cars first. In terms of F&I results, at First Texas Honda the one-person hybrid approach seems to work best for new cars.

The store recently switched back to a more traditional approach for used cars, in which a separate F&I manager handles the F&I part of the transaction.

“We’ve been at this four years now, and we are still discovering things,” Baker said. “I’m not sure I could even explain why, exactly, we have found it is better for a contractor to concentrate on used cars. We recently did this, and our numbers went up immediately.”

6. Don’t assume you need no-haggle pricing. Baker said it’s possible to use the hybrid F&I approach even with traditional price negotiation.

First Texas Honda adopted both hybrid F&I and one-price, no-haggle selling, starting at the same time. But Baker insisted it’s possible to switch to the hybrid approach without switching to one-price selling.

“One of biggest things I want to try and get across is you don’t have to be one-price to try this. You really don’t,” she said. “I’m not advocating for people to be one-price.”

You can reach Jim Henry at



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