We\u2019re all guilty of using the latest catchphrase or slang to grab our listener\u2019s attention. These catchphrases serve several purposes. We use them to convey complex ideas, create brand identity or reflect cultural associations with specific demographic groups. When it comes to retail automotive sales, using the wrong catchphrase can land the team member \u2013 and the dealership \u2013 in compliance hot water.<\/p>\n
Let\u2019s consider the catchphrase \u201cbumper-to-bumper.\u201d Retail salespeople and F&I staff have used this term since the 80s to describe the concept that a warranty or protection product covers the entire vehicle. In fact, during a recent visit to a used car dealership in my area, the salesperson went to great lengths telling me about the total coverage warranty that made this particular vehicle such a great deal.<\/p>\n
When I explained that \u201cbumpers\u201d were actually covered by insurance policies \u2013 not vehicle warranties \u2013 the salesperson tried to casually dismiss the distinction. While I\u2019m a knowledgeable buyer, many car buyers are not. Creating the perception that a vehicle warranty truly covers an entire vehicle end-to-end is not only misleading, it could be an accidental violation<\/strong> of Section 5 of the Federal Trade Commission Act: Unfair or Deceptive Acts or Practices<\/a>. When used to intentionally mislead a certain set of consumers, it may also violate other federal or state laws. Using this catchphrase is not only incorrect, but its use can also be unlawful and result in a costly fine of $51,744 per violation.<\/strong><\/p>\n Speaking of compliance, the soon-to-be-in-effect CARS Rule<\/a> (Combating Auto Retail Scams) enacted by the Federal Trade Commission comes to mind when thinking about words and catchphrases. \u00a0The CARS Rule prohibits dealers from using bait-and-switch claims to lure vehicle buyers to the lot. Claims such as the cost of a car or the terms of financing, the availability of any discounts or rebates, and the actual availability of advertised vehicles are included in the regulation.<\/strong> The Rule also addresses charges or hidden fees in contracts that are not agreed upon by consumers.<\/p>\n Window tint, bedliners and appearance protection product add-ons to new vehicles also have new layers of compliance. If these products are provided by the manufacturer as part of the vehicle\u2019s make and MSRP on the windshield sticker, and the installation process simply takes place at the dealership, then there is no issue. However, if these products are separate, after-market add-ons, then the cost must be itemized and disclosed as separate from the cost of the vehicle.<\/strong> Stating that these items increase or \u2018optimize\u2019 the total value of the vehicle runs counter to the CARS Rule and is a compliance issue. Additionally, F&I products, such as Appearance Protection, must be cancelable \u2013 or in this case removeable if the consumer declines the feature. Going forward, dealers might need to hold off on applying these products until after a customer selects them. Hiding or misrepresenting these items as \u2018premium add-ons\u2019 either during the sales or F&I process becomes a costly compliance mistake.<\/p>\n Words matter online too. What is said in person must match what is conveyed through the dealer\u2019s digital footprint,<\/strong> including text messages! The online sales process and services offered must mirror sales process in the dealership or \u2013 you guessed it \u2013 you are out of compliance.<\/p>\n Say for example your sales team encourages buyers to come into the dealership to negotiate the final sale. Common practice \u2013 right? But now, compliance regulations also require your sales team to fully negotiate the deal online, and honor the price quoted when the customer does come in<\/strong> to sign any papers or take possession of the vehicle. This also includes providing options for trade-in valuation and financing applications online.<\/p>\n While many dealers already offer these options, the distinction lies in consistent, transparent pricing and processes \u2013 both online and in person. If you update your sales scripts, make sure you use the same language on your website. Ensure your sales and F&I teams present the same offerings both online and in person. Citing a lower price online and revising that price upwards when the customer arrives on site is grounds for a compliance violation.<\/p>\n If all of this seems like a lot of hoops to jump through, I understand. But the fines assessed for compliance violations at the local, state, and federal levels can quickly add up, take up hours of legal and administrative time, and damage your dealership\u2019s reputation. Our proven team of EFG trainers<\/a> and F&I experts can help your dealership understand the role words play, implement good compliance practices, and avoid the risk of violations. At EFG Companies, we\u2019re more than an F&I provider, we\u2019re your business partner in the retail automotive industry. Contact us<\/a> today to learn more about how our team can help you achieve your winning strategy.<\/p>\n","protected":false},"excerpt":{"rendered":" We\u2019re all guilty of using the latest catchphrase or slang to grab our listener\u2019s attention. These catchphrases serve several purposes. We use them to convey complex ideas, create brand identity […]<\/p>\n","protected":false},"author":1,"featured_media":2107,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[86],"tags":[638,116,304,637],"class_list":["post-2106","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-compliance","tag-cars-rul","tag-dealership-compliance","tag-ftc","tag-udap"],"aioseo_notices":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/efgintelligence.com\/dealershipcorridor\/wp-content\/uploads\/sites\/2\/2024\/05\/Glenice-Wilder-Author.png?fit=1050%2C350&ssl=1","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p7hsqu-xY","jetpack-related-posts":[],"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/posts\/2106","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/comments?post=2106"}],"version-history":[{"count":1,"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/posts\/2106\/revisions"}],"predecessor-version":[{"id":2108,"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/posts\/2106\/revisions\/2108"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/media\/2107"}],"wp:attachment":[{"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/media?parent=2106"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/categories?post=2106"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/efgintelligence.com\/dealershipcorridor\/wp-json\/wp\/v2\/tags?post=2106"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Transparency for all costs<\/h3>\n