Five years ago, AFIP executive director Dave Robertson set a goal of having Pat Ryan inducted into the Automotive Hall of Fame. Earlier this year, a post-NADA convention Automotive News article on Robertson’s quest prompted an invitation from the Hall for a nomination.

Pat Ryan started the first F&I department at Dick Fencl Chevrolet in Chicago in 1962, “forever changing the way dealerships operate.” The rules he established for this new and valuable profit center ensured that it became a fundamental part of dealership operations.

Ryan’s rules:

“I put in a system where I had to see every customer,” Ryan said in a 2005 interview with Automotive News. “I offered them the dealership financing, whether they were going to go to a credit union or pay cash or go with their own bank. I asked if I could also sell them credit insurance.

“The idea was 100 percent solicitation. We made it mandatory that the finance person had to expose every customer to the products we offered. That made a significant difference.”

Mike Cook, Ryan’s Detroit office manager in 1972, told Automotive News in a past interview that when a store added Ryan’s system for an F&I department, “it doubled finance and insurance income in 60 days.”

The key to making money through F&I, Ryan said, was clearly explaining the potential benefits to be had [by financing the vehicle or purchasing insurance] through the dealership to every dealership customer.

According to Dave Robertson, “The presence of a qualified dealership employee to find an institution willing to fund the vehicle established the essential synapse between the customer agreeing to buy the vehicle and getting it financed. A significant number of agreed-to sales were lost when prospective buyers were unable to find a bank willing to loan them money for the car. Controlling the funding dramatically reduced lost sales and became a new dealer source of revenue.”

“The presence of dedicated F&I specialists,” Robertson added, “also gave rise to what is now known as the aftermarket product industry. Ownership satisfaction is influenced to a significant degree by vehicle-related expenses incurred after the sale. Credit life provided the surviving spouse much needed payment-free transportation. Accident and Health coverage kept the monthly payments current during a medical crisis. Vehicle service contracts have paid billions of dollars in mechanical repair bills.”

© The Association of Finance & Insurance Professionals 2018
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This article is intended for informational and educational purposes only. It should not be considered legal advice. Readers are responsible for obtaining legal advice from their counsel.