Powersports dealers have a myriad of challenges facing them today. Between sky-high interest rates and waning consumer demand, profit margins are beginning to feel the sting of a market that is on the precipice of right-sizing. With this mounting pressure, dealers are rightly concerned about how to maintain their profit margins in the weeks and months ahead. All too often, when the going gets tough, compliance falls to the wayside, and you may be asking yourself, “where is the CFPB anyway?”
The CFPB and FTC have not been making waves like they have in the past, but that does not mean they are not present. In fact, the CFPB has been busy this year bringing lawsuits against auto lenders and servicers. You may think that since these suits don’t affect you or your industry, you don’t need to worry.
If that is you, consider this. According to the National Council on Identity Theft Protection, there is an identity theft case every 22 seconds in the U.S. and 33 percent of all Americans have faced some kind of attempt in their lives, with experts predicting this number could increase significantly this year. So far this year, the Federal Trade Commission (FTC) has received 5.7 million total fraud and identity theft reports, 1.4 million of which were identity theft cases accounting for $10.2 billion in losses. This is a great example of why policies like the FTC Safeguards rule were put in place. Compliance procedures often serve as critical guard rails that can protect your customer’s data – and your dealership.
While all seems quiet on the compliance front, now is a great time for your dealership to brush up on best practices for a compliant and profitable future.
Seven easy compliance steps to implement today
Think of compliance as muscle memory. If your dealership team is in the habit of taking compliance steps every day, soon it will become a habit and standard operating procedure. Here are seven steps that will keep that compliance muscle in tip top shape.
Organize your deal documentation
Don’t let sloppy deal folders or scattered paperwork put a kink in your compliance muscle. Make sure everyone understands the specific deal documentation process – and follows it every time.
Put your procedures in writing
Do you have new team members? Long term team members who like to cut corners? It’s easier to enforce compliance procedures if they’re written down.
Provide compliance-specific training and document it
Just like athletes’ train for their jobs, your team members need to train their compliance muscles. Whether it’s a refresher course or an A-to-Z overview, don’t assume your team understands the ‘why’ behind the ‘how’ of compliance procedures.
It’s also just as important to have documentation on all compliance training completed at your dealership. It is one thing to say you train on compliance, and another to properly document the subject matter, participants, and date of each training session.
Create an environment of compliance – and set the example
Embrace compliance in your dealership versus ignoring or dismissing it. Show off those fit compliance muscles and make it easy for everyone to come onboard.
Name a compliance officer
Everyone needs a coach and your compliance officer can lead the group, setting an example, training, and maintaining.
Establish a compliant management system
Just like circuit training, being in compliance requires specific steps to achieve success. Don’t let complaints fester! Have a system to manage them.
Whether it’s a water break or a stretch, every good coach takes five minutes to refocus the team. As a dealer principal, take five minutes every day to walk around your store with an eye towards compliance.
Remember, you are not alone on your compliance journey. Our proven team of EFG trainers bring years of compliance experience and fully flexed muscles to help. We can easily come alongside your staff, assist with training needs, and help you implement your compliance system. At EFG Companies, we’re more than an F&I provider, we’re your business partner with years of expertise helping powersports dealers cultivate compliant profitability. Contact us today to learn more about how our team can help you achieve your winning strategy.