Maximizing Dealership Value with ValueShield: A Strategy for Dealers

ValueShield® presents a transformative approach to enhancing customer satisfaction and dealership profitability across various dealership models. Its integration alongside traditional products like GAP insurance, known as "GAP Wrap," offers a robust financial protection package that not only covers total loss scenarios but also addresses the diminished value of vehicles post-accident, a concern unaddressed by GAP insurance alone.

Comparison with GAP Insurance

While GAP insurance is pivotal for covering the loan balance in total loss situations, it falls short in protecting the vehicle's value after an accident that doesn't result in a total loss. Here, ValueShield® steps in, offering "Accident Forgiveness at the dealership level," which preserves the trade-in value by compensating for the diminished value due to accidents. This ensures that customers can still get fair value for their vehicle when they decide to trade it in, enhancing customer trust and loyalty towards the dealership.

Dealer Profitability: With and Without ValuwShield®

A typical dealership scenario illustrates the financial benefits of incorporating ValueShield®. For instance, a standalone GAP product might generate $900 in F&I profit, but with a high chargeback rate of 50%, the net profit drops to $450.

Incorporating ValueShield® into the "GAP Wrap" significantly reduces chargebacks, almost doubling the retained profit to $850 with minimal chargeback risks, showcasing a substantial increase in dealership profitability.

ValueShield's Stickiness and Reduced Chargebacks

ValueShield®'s advantage lies in its high likelihood of utilization—over 90% in the event of an accident—making it a highly "sticky" product that benefits the customer significantly more than traditional GAP insurance. This high engagement rate drives customers back to the dealership for claims, enhancing retention and reducing the risk of chargebacks, a common challenge with GAP insurance.

ValueShield and ACV for Trade-Ins:

ValueShield® plays a crucial role in trade-in valuations by protecting against diminished value post-accident. This ensures dealerships can offer fair trade-in values, enhancing customer loyalty and dealership profitability.

In this scenario, the customer is offered an ACV of $37,000 for the trade-in, which is $4,000 more than the book value. And the dealership retains $3,000 additional profit for the transaction.

Impact Across Different Dealership Models:

1. New Car Dealerships: New car buyers, valuing their investment's future worth, find reassurance in ValueShield®. It safeguards against depreciation due to accidents, complementing the advanced features of new vehicles which could be costly to repair, thus maintaining the vehicle's value and buyer confidence.
2. Used Car Dealerships: For used car dealerships, ValueShield® ensures the investment in a used vehicle is protected against unforeseen depreciation, making their offerings more attractive. It also allows dealerships to confidently accept trade-ins with a history of accidents, offering more competitive trade-in values.
3. Leasing-Focused Dealerships: Leasing dealerships can use ValueShield® to protect lessees against potential lease-end value disputes, making leasing deals more appealing by mitigating lessees' risks and enhancing the dealership's leasing business.
4. Buy Here, Pay Here (BHPH) Dealerships: In BHPH dealerships, ValueShield® mitigates the risk on the dealership's assets and fosters customer loyalty by protecting the vehicle's value, crucial in repossession scenarios.

Role-Specific Benefits within Dealerships

• Sales Consultants/Salespersons: Can offer ValueShield® as a value-added product to build trust and rapport with customers, leading to higher customer satisfaction and potential referrals.
• Internet Sales Managers: Can leverage ValueShield® as a unique selling proposition in online listings and communications, setting the dealership apart from competitors in the digital space.
• Sales Managers: Can use ValueShield® to improve the overall profitability of sales deals and manage inventory more effectively by accepting trades with diminished value without financial loss.
• F&I Managers and Directors: Can enhance their product portfolio with ValueShield®, boosting F&I profitability while reducing chargeback risks and enhancing customer value propositions.
• General Sales Managers (GSM) and General Managers (GM): Can oversee the integration of ValueShield® into the sales process, ensuring a consistent and profitable approach across all sales channels.
• Dealer Principals/Owners: Can secure long-term dealership profitability and customer loyalty by embedding ValueShield® into their core offerings, setting a foundation for sustainable business growth.
• Chief Financial Officers (CFO) and Controllers: Can appreciate the positive impact of ValueShield® on the dealership's financial health, with reduced chargebacks and enhanced profitability on trades.
• Marketing Managers/Directors: Can create targeted marketing campaigns highlighting the unique benefits of ValueShield®, attracting customers looking for comprehensive vehicle protection.
• Customer Relations Managers: Can utilize ValueShield® as a tool to address customer concerns regarding vehicle value post-accident, improving customer satisfaction and loyalty metrics.

From Sales Consultants to Dealer Principals, ValueShield® offers extensive benefits across various roles within the dealership, enhancing both customer satisfaction and dealership profitability. It addresses specific customer concerns, improves the value proposition, and supports sustainable business growth across all dealership operations.

Connect with me for Insights!

For dealerships looking to explore the full potential of ValueShield®, Charles Nelson is an authorized ValueShield® distributor, offers a unique opportunity.

✉️ nelsonauto@gmail.com

📱 512-751-5669

🏢 www.valueshieldtx.com

Contact me for more information and a complimentary evaluation and analysis of ValueShield® at your dealership. This personalized approach ensures you receive expert insights into how ValueShield® can be tailored to maximize your dealership's value and secure long-term success.

Conclusion

By aligning ValueShield®'s benefits with the dealership's operational focus, dealers can effectively leverage this product to meet and exceed both their business objectives and their customers' needs, making it a key strategy for all dealership types looking to maximize their value and ensure long-term success.