what is a deal optimiser?
This is a really important question as there are a number of software systems in the market that claim to have a Deal Optimiser or Profit Optimiser – but do they?
The simple answer is NO. Being able to construct (“stack”) a deal in either simple or complex terms is NOT optimisation. Being able to “move the numbers around” is just basic deal construction.
Once the raw ingredients of a deal have been assembled and negotiation between the customer and the dealer has effectively concluded and before the deal is concluded, NOW is the time for optimisation which involves huge numbers of comparisons of very similar deals to get exactly the best deal from everyone’s point of view. The whole point is to improve the dealer’s profitability while AT THE SAME TIME leaving the customer’s deal the same.
Only ABC can do this.
Optimisation Effect
- Pre-optimisation – effectiveness 65%
- Post-optimisation – effectiveness 92%
- Which is the best way to put the deal down on paper? Renewals will be different from new business.
- Which product with which lender is most appropriate for this customer? PCP, HP, Lease Purchase, Personal Loan, Cash etc.
- What payment profile should we use? Each one produces a different outcome
- With which lender? (some dealers turn this feature off for commercial reasons)
How far should the deal be written back for VAT purposes? Too little or too much just throws profit away but does the customer have enough deposit? Just the right amount?
As long as the payment remains unchanged for the customer, should we go for an up-front fee product or use a spread fee product as most dealers do?
FCA regulations make all these comparisons even more complicated as the APR must remain unchanged to comply with TCF (Treating Customers Fairly) guidelines.
An average Deal Wizard™ comparison looks at about 5800+ different versions of the same deal to find THE best option for the dealer AND the customer.
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