Client Profitability

4 Keys to an Optimal Dormant Judgment Strategy

By | Client Profitability, Data Analytics‏, Debt Collection, Performance Management | No Comments

Happy Holidays to all my peers in the Accounts Receivable Management (ARM) industry! With the tax season upon us, it is holiday season for businesses of every kind who will be marketing at the discretionary dollars consumers will be receiving from their 2015 tax refunds. Whether it is a furniture store or car dealership, companies are already bombarding consumers with incentives to cash in their tax refund while the getting is good. ARM companies are no different as we make tax season settlement offers, however with the billions of dollars of dormant judgement inventory in the market today shifting to garnishments may prove to be a more successful tax season strategy.

When you consider the lifecycle of a file, it is typically in the pre-judgment status for a very short period of time. On average, it takes 12 months from the placement date of a new file to reach a judgment status and that is being conservative. When you then take into account states like Arizona or Pennsylvania that have the shortest statue on judgments (at 4 years) compared to states like Illinois or Alabama that have the longest statue on judgments (20 years), a file is in the pre-judgment status for 5-25% of its lifecycle. Given how quickly a file progresses to judgment status, every law firm will have a surplus of dormant judgements to target this tax season. Read More

Profitability vs. Cash Flow – Are You Carrying Dead Weight?

By | Client Profitability, Cost Analysis, Data Analytics‏ | No Comments

In our last blog, “Contingency Rates at 15% – No Way or Hell Yes?”, I discussed client profitability by taking a closer look at how to calculate correct commission rates for a new client. This week, I would like to take the conversation a step further by examining the profitability of existing client relationships.

  • Do you fall into the trap of chasing cash flow instead of profitability?
  • Do you know which clients are profitable?
  • Do you know how many profitable clients it takes to carry each of your unprofitable accounts?

Read More

Contingency Rates at 15% – No Way or Hell Yes?

By | Client Profitability, Data Analytics‏, Performance Management | No Comments

As a company servicing the debt collection industry it is vitally important to partner with the “right” clients. Minimizing risk, while maximizing profit has never been as important as it is right now.

I have heard countless stories how my peers have gone through months and months of a sales cycle – hosting auditors, filling out endless RFP’s and Security Questionnaires – only to get to the finish line and hear, “we would like to hire you and our contingency rate is 15%”. Standard reply….”Hell no! That might be a great contingency rate for accounts that are 60 days past due but for seconds over my dead body!”

Leveraging Surefire Analytics, we would suggest you take pause before telling such a client to go fly a kite! Let’s take a closer look at the details. Read More