WhitepaperBoosting Profits With Menu Selling
While it is unlikely your customers will purchase something they do not need – for sure they are not going to buy something that was not presented. Menus don’t sell anything on their own – a menu’s purpose is to present the growing number of products you sell more efficiently than a step selling approach.
A Little History
Menu selling is a method of selling that presents groups of products or services to a prospect – as opposed to traditional step selling methods where each product is separately presented and sold to conclusion.
Grouping products together on a menu is not new – fast food giants like McDonalds and A&W have been using it for years – if you have ever bought a “Combo” you’ve used a “menu” to purchase your meal. Menu selling has been around US dealerships since the mid 1990’s.
Menus don’t sell anything on their own – a menu’s purpose is to present the growing number of products you sell more efficiently than a step selling approach. Imagine how long it would take to purchase a hamburger and fries if you had to make individual decisions on each of the 63 products McDonald’s sell – it wouldn’t be “fast food “, that’s for sure! Fortunately, you don’t have to because you are familiar with their products. It’s the same with your products – your customers are quite savvy – they know what most F&I products are through past experience or their own research. The last thing customers want when they have just closed the deal is to endure another hour or more for an F&I presentation.
While it is unlikely your customers will purchase something they do not need – for sure they are not going to buy something that was not presented. Which highlights the crux of the problem and the opportunity for menu selling – how are you going to position the myriad of products you sell? Simply, there is not enough time to present each product. Menu selling is the most effective and only way to present all of your products to every customer, every time. Not only is it more efficient, it is also more effective because it takes you from your agenda of “selling” to focusing on the customer’s needs. When you use menus, you are not selling, you are reviewing options.
Menu Selling Benefits
- Increases F&I revenue – according to Chris Schulthies of Wye Management Group, menu selling training experts, “when dealerships implement menu selling in their F&I departments, we normally see an increase of $200 to $300 per transaction almost immediately”.
- Shrinking profits from retail – according to US research (CNW Marketing/Research), F&I sales represent 46.8 percent of dealer profits, auto dealerships biggest profit center – all the more reason to maximize your F&I department’s revenue potential.
- Reduces time in the F&I office – there is no doubt that menu selling reduces the amount of time a customer spends in the finance office. Savings vary depending on menu complexity and time spent qualifying your customer – many are able to reduce the amount of time from 45 minutes to about 15.