When I started writing articles many years ago, a highly respected mentor told me I must grab the interest of my audience by telling a story. Whether the story is personal, funny or a life lesson, readers gravitate toward writers who personalize their pieces. 

So I begin my articles with stories about being an experienced member of the automotive compliance community. Every now and again, I throw in personal stories about my family. 

Over the last 20 years, that same mentor taught me everything I know about automotive compliance. As you know, the automotive industry is ever-evolving, and staying abreast of all the laws, regulations, industry standards and best practices can be a daunting task. Not only do we need to stay informed of the laws, but we also need to understand the tools that dealers utilize to do their jobs.

One important tool that aids dealers, not only as a selling tool but also a compliance tool, is the menu. The menu is effective by offering product options to enhance the purchase of the vehicle. It is also an effective compliance tool, providing disclosures to the consumer, as well as ensuring that all products are offered to all consumers 100% of the time. Most menu programs allow the dealer to decide on the format, appearance and disclosures to include on their menus. These settings should be consistent on every deal.

How to Start

The menu process begins after the consumer and the dealer agree to terms in the sales process. The dealer generates a menu page presentation. Some dealers take the old-school route and present a paper copy of the presentation page, while others have moved to an electronic menu on their fancy gadgets. Either way, the presentation page should include key terms to memorialize the sale of the vehicle. These terms include vehicle price, down payment, trade information, base payment, term, and annual percentage rate. Including these determinants allows the dealer to reiterate the agreed-upon sales terms before moving onto the product presentation. 

Terms

I have never claimed to be an effective F&I trainer but would recommend the dealer use a word tract, such as, “These are the terms you agreed upon in sales, and you can take delivery of the vehicle with approved credit. Your agreed-upon price is $49,999, with $7,500 cash down. Your base payment is $700 for 84 months at 5.99%. These payment terms may not be your best option. I have some optional product protections I would like to discuss with you that may better fit your needs based on your driving habits.” 

Optional Products

Before proceeding with the optional products, it is recommended that the consumer initial the base terms, acknowledging the terms they could take the vehicle for without any additional products. If for any reason the base terms change, say the consumer decides to put more cash down, a new presentation page should be generated and presented to disclose the new base terms.

Now that the initial terms are laid out to the consumer, move on to the presentation of the optional products. The product presentation includes all the products offered and shares the features and benefits. The presentation page is effective because it helps the dealer pitch the products, highlighting why the products would be beneficial to the consumer. The page can be tailored to appeal to the consumer’s needs and driving habits. The presentation page should include the final terms, with products selected and a consumer acknowledgement.

Last Step

The final component to a compliant menu process is the execution of the Accept Declination Page, or AD page. The AD page is broken down into two columns, one including the products the consumer agreed to purchase, the other disclosing the products the consumer declined. Be sure to disclose the base and final terms for payment walk confirmation and the prices for the products the consumer agreed to purchase. Include a disclosure stating that the products are optional, the consumer had the option to purchase the products outside the deal, and financing is not contingent upon the purchase of the products. The dealer should verbalize the payment walk, confirm the accepted products, and have the consumer sign and acknowledge the Accept Declination. 

Adopting an effective menu process has become an industry standard. It is not only a selling tool, but it also helps with compliance!

Penelope Bell is an associate at Automotive Compliance Education.