The Sonic-One Experience Puts A Nail In The F&I Coffin.

0
Winner raised arm in victory gesture and loser crawling on floor with white flag to surrender. Vector illustration for business concept isolated on grey background.

As an F&I trainer with over 17 years of experience, many people find my advocacy of the “Sonic-One Experience” strange if not offensive. The Sonic-One Experience is Sonic Automotives controversial plan to eliminate their F&I departments in favour of a hybrid process where a “Sonic Experience Guide” handles the entire sales transaction on an iPad. There’s no negotiation, no Sales Manager interaction and no turn over to an F&I Manager.

Sonic One-Experience

My interest in the Sonic One-Experience arose after I read about their one person, one price, one-hour process where customers drive their new car out of the dealership within 45 minutes of making a vehicle selection. Sonic is piloting this process at 5 dealerships in Charlotte, North Carolina in order to work out the bugs before rolling it out nationally.

Sonic Experience Guides

To facilitate these complex transactions Sonic seeks out non-traditional sales people for the position of Experience Guide. They prefer those that have a capacity to learn, excellent communication skills and function well in a team environment as opposed to having automotive sales experience.

Sonic pays their Experience Guides a base salary and bonuses for achieving sales and F&I targets. Their attractive pay plan offers Experience Guides an opportunity to earn well above the industry average, which has resulted in dramatically lower turnover, plus reduced HR and retraining costs.

Spot Deliveries

In order to deliver vehicles in 45 minutes, Sonic doesn’t wait for finance approvals. Their Finance Directors will “spot deliver” a car if a client has an acceptable beacon score. Sanjay Prakash, Town and Country Toyotas GM is confident about their ability to get deals financed because they’ve developed an approval process that is “Predictable, Repeatable and Sustainable”.

Sonic hasn’t totally eliminated F&I managers, they’ve just realigned the process by putting the vehicle and F&I product sales into the hands of the Experience Guides and the approval process into the hands of Finance Directors. This makes sense because often times F&I Managers are either really good at sales or administration, rarely both.

Mystery Shop

I wanted to experience their process for myself, so I went to Town and Country Toyota; Sonics flagship store in Charlotte and mystery shopped them. I was so impressed with the Sonic-One Experience that I wrote a column about it and published it on several platforms.

If you haven’t read the original piece, I’ll summarize if for you now: I was impressed. Very impressed.

My Experience Guide, Zigmond, was cheerful and welcoming. He gave me a dealership tour and told me what makes Town and Country Toyota different than a traditional dealership. He highlighted the fact that my experience would be transparent and pressure free. He build value in the Sonic True Price system by telling me the prices are set using proprietary software along with J.D. Power and Polk data to reflect fair market value every month.

Zigmond took me on a demo drive and guided me on a predetermined route. Then he invited to join him at once of several, comfortable dealership lounges to make a deal. I was given a Sonic True Price of $39,992 on 2015 Toyota Tundra that had an MSRP of $45,528. We worked through the finance numbers on the iPad together. He didn’t leave to consult a manager and didn’t use a single pressure tactic to try and close the deal.

I eventually revealed who I really was and he offered to introduce me to Prakash, to talk further about the process.

I ended my column exploring how based on my experience, Sonic is on the right track.

“Perhaps, the Sonic-One Experience is the way of the future for dealers with the courage to embark on a customer-centric, transparent and profit-driven process,” I wrote.

Feedback 

The feedback I received ranged from scathing criticism from F&I Managers to overwhelming enthusiasm from Sales Managers, Sales Consultants and Dealers. On one occasion I walked into a dealers office and saw my column highlighted and annotated on his desk. The dealer said he loved the concept, but doesn’t have the confidence in his team to engage in a similar process, at this time.

LinkedIn

I published an unedited version of the column on LinkedIn with a “disclaimer” saying that I was not advocating the end of F&I, as it was never my intention to start a movement to do so. Within weeks it received over 12,400 views and inspired some very passionate dialogue.

Twitter

I tweeted the column and it got the attention of Auto Dealer Live, an Internet radio show that broadcasts nation wide for the automotive industry. They invited me to debate “Eliminating the Box” with a panel of experts at Digital Dealer 20 in Orlando. The result was a vigorous and passionate exchange of opinions with some of the best minds in the automotive industry. We agreed that the process wasn’t for everyone, but it’s a growing movement that’s gaining momentum.

Town and Country Toyota’s 2015 numbers are in, you decide

Prakash says Sonics “customer-centric sales process” is not only faster and more transparent; the numbers prove that their customers prefer no-negotiation pricing and a single Experience Guide to facilitate the entire transaction.

Town and Country delivered a record 3152 units in 2015. Prakash says their market share of new Toyota sales grew from 12% to 23% since they implemented the Sonic-One Experience. Plus their F&I profit is higher than its ever been.

The Bottom Line

Will Sonic’s bold move inspire more dealers to eliminate their F&I departments in favour of a Hybrid process? Perhaps not today, but it’s only a matter of time until more and more dealers see the incredible benefits of adopting a one person, one price, one hour, consumer friendly experience. My goal is to be on the front lines with a seamless and profitable process to help them implement and sustain it.

Jim De Luca
VP Digital Road to a Sale Inc.
905 865 8734
jim@digitalroadtoasale.com
digitalroadtoasale.com
linkedin.com/in/jamesdeluca1
@jimdelucaDRS