What Dealers Want
It would seem as if lenders have their hand firmly on the dealers’ pulse. Ritchie’s dealership has reaped the benefits of e-contracts similar to those employed by Western Funding to expedite contract dealings for the customer and recoup business costs quicker. “We’re able to get paid for [contracts in transit] within 24 hours, rather than seven days,” Ritchie said.
Flexibility is another important value proposition that lenders can offer dealers. “It’s all about the relationship,” said Jim Houston, senior director of automotive finance at JD Power. Dealers want lenders to help them fund applications that don’t necessarily fit in the box so they can smoothly sell cars to consumers, he said.
Ritchie, too, puts stock in lenders being more flexible. “Most lenders, whether it’s Wells Fargo, SunTrust Bank, or BB&T, they are all very flexible and creative,” he said. “Their offices are open on Saturday, so if we need to get an answer to, ‘Is this [customer] a preferred or a super-preferred?’ somebody from [their office] usually gets back to us within 30 minutes.” Those seemingly small efforts help eliminate the guesswork, he added.
To be fair, dealers, too, run into issues perpetuated by advances in technology. Machine learning and artificial intelligence — systems that are always adapting to new information — have the potential to cause irregularities dealers don’t expect.
One of the biggest challenges Ritchie faces is making sure lenders are consistent in the loans they purchase. “If [lenders] are going to buy a 650 [credit score] this week, will they buy one next week? Consistency is the biggest thing we ask for.”
However, the human touch is a great way for lenders to help remedy the occasional issue of inconsistency. Rick Ricart, president of Ricart Automotive, simply picks up the phone and calls the lender to ask for an explanation.
“Usually the human being will see that and say, ‘It looks like the automated system picked up on this or that, but in the grand scheme of things, it isn’t as important,’” Ricart said. “‘Let’s change that.’”
Most importantly, dealers want to feel as if the lender values them as a partner. “I think the lenders are listening,” Ricart said, noting that in the past year, lenders’ focus has been less on squeezing originations out of dealers and more about working together to sustainably grow into the future.
