Wake up, Buy Here, Pay Here people. It's a beautiful day. Go grab yourself another cup of Joe and say hello to Jim and Michelle Rhodes on the Buy Here, Pay Here morning show. Take it away, you two. Hey, welcome friends to another Friday episode. We don't have the beautiful Michelle Rhodes in studio today. She's traveling. So we have the handsome Ken Yang joining from, uh, are you in North Carolina home today? I'm in North Carolina today. Wonderful. You've got your North Carolina accent going on there a little bit. That's right. That's good of you. I've got a couple of things to share. We will be away for a stretch. We're going to I think next week's both episodes for next week will be reruns. We've got some important episodes that need to be seen again for anybody who missed them. We'll have those set to broadcast in the normal time slot, but just know that we will not be joining live. Michelle and I are going to make time for a little getaway, and so we're going to see what vacationing is like. We haven't done it in a good while. Oh, here comes Mr. Nathan Syme, too. I extended the invitation to both these gentlemen at the last minute, but didn't really know that either one of them would be able to chime in on the conversation at the last minute, so we'll give Nathan a minute to get his AV connected. There he comes. Welcome, Nathan. Hello, how are you doing? Good. Glad to have you here. On the short notice, I really wasn't sure that it would work out for either of you to participate, but I'm glad you're here. Are you not hearing us? Yeah, I hear you. Sorry. Okay, good. All right. I'll just make sure we're good before we move ahead. So today is something I thought with you guys being dealers yourselves, it would be good to have you here to offer your thoughts. This is something that we've talked about in the past on the podcast probably been a couple of years ago. The only difference now is that we've got more detail, more prepared actual booklet for dealers to be able to refer to if they wish to use this sort of calculation. So today we're talking about what I will call collection efficiency. And typically we're referring to it in collection efficiency, measuring how well we're getting money in the bank. But after a meeting with a dealer yesterday and working through these collection efficiency numbers, dealer started to ask some pointed questions about, could my deficiency be caused by this? And I said, yes, it absolutely could. So we dug into it. So I think this is kind of the purpose of, you know, kind of drilling into this because there's so many layers to to choosing to look at collection efficiency. A lot of dealers look at delinquency. Some look at recency. We know there are dealers out there that look at collateral recovery rate, all relevant in their own ways. Right. They all have they all tell a different story. So I think our collection efficiency today and more specifically identifying the deficiency is part of what is meant to help dealers point to better identify the areas in their operation where there may be some, I'll call it leakage just generally. I don't mean people are putting money in their pocket. I just mean the money is not making it into the bank account for whatever reason. And so today we should give folks a really specific way to identify those dollars that are not being used. generated ken have you heard me talk about collection efficiency you know what that is you know what i'm talking referring to that actually no i don't think i've i don't think i've heard that now okay so we'll we'll get into it nathan i don't recall you you do it you've been tracking it yourself nathan for quite some time we kind of got you stood on that uh probably what year and a half or so ago probably yeah sounds about right so i've actually got some data teed up that we can share that's from a dealer that is um we have two and a half years worth of weeks of data. You're talking, I've got on the screen over here on my side, but got one hundred and fifty three weeks of data to build on a one thirty six to build a point two. And so this is this is really going to be important information to be able to kind of pass along for folks and get a sense for how this is different. So I'm glad you guys are here to be able to kind of add your perspective on know what's going to be presented so let me uh clean up a couple formatting things i'm trying to zoom a little bit messed things up got squared away so um nathan i might just have you share before i dive into all that kind of what your experience has been in tracking collection efficiency i mean what do you what do you like about it you continue to do it so what do you find that you gain from it as a dealer so i think when it comes to building effective collection policies, it is a way for us to know when what changes that we're making are working and what policies might be impacting the actual dollars we're bringing in. So, you know, I like to make decisions off of data, not off of guesses. So when we look and we can see that, you know, if you're working with a customer and you have a policy when it comes to promises to pay or working with them on a, you know, we're going to make two payments instead of one and all of those kinds of things. So when you're, when you're making those decisions, you want to be able to see if, it in fact is impacting your overall collections, right? So that just gives you an actionable way to ensure your collections department is doing their job, first off. And second, that the internal policies of the dealership are meeting the standards of what you should be collecting in terms of Yeah, that's great. I would say the policy part is important. I think what this starts to address, and I've written articles on this over the years, and I find myself talking more about philosophy because when you say your people are doing their job, they're doing it according to the philosophy and business approach that you want to adopt in your business, right? So this is a way to measure and confirm that the team is hitting the marks that you find relevant which, you know, I'm getting ahead of myself here a little bit, but essentially what's happening is, you know, you're able to look beyond the delinquency factor and say, because otherwise we might be a little reactive, right, as dealers. We can be a little reactive and say, wow, my delinquency is sky high. We got to go, you know, raise some hell in the collections department or whatever. And sometimes that's a little bit, First of all, it's reactive as I said, but it's also applying pressure to the team when they very well may be doing the job that you have actually asked them to do. So this is where it becomes challenging. And that's why the recency becomes a consideration here. But I think when we get into the actual process of tracking collection efficiency, then people start to understand maybe how it's different. Let me share on the screen here some information. This is an actual dealer's data. And I know I'm going to have to zoom in on that for you guys to be able to... read any of it but I think the most significant thing to express here is that you know when you look at that that report you've got as I said this this this is live as of this past week and what you're seeing is data from A hundred and thirty six weeks. So this dealer's now got two and a half years of week over week data. So you talk about being able to identify trends and determine whether or not anything's really shifted in their practices. And I can tell you in this particular dealer's case, part of what set this this conversation in motion is. The collections team used to pretty consistently land in the ninety five percent range. We've got tiers set up for them and bonuses associated with this collection efficiency outcome. And they've just been kind of falling a little bit lower. They've been falling in town at ninety three percent. It's not necessarily an alert, but it is different than where they were. And so we want to try to understand what's what's different. Why are we collecting ninety three percent instead of ninety five percent? And so I've got on the screen separately. It walks you through these particular numbers. But let me just first explain what the ninety three percent number is. So looking at this, this let's look at the last two weeks with this particular dealer. Contractually speaking, the dealer was supposed to bring in for those not seeing the screen. Forty six thousand nine hundred and eighty one dollars. So what I mean by contractually, Ken, is that we got to be on a software that allows us to generate a report that tells us in an upcoming seven day period. We're used to using Monday through Sunday. But right now, if we were to run a report for next Monday through Sunday, will it tell us? the payments that are contractually due in the portfolio based on the number of accounts or the accounts that are active today. Okay, so obviously if the customer's biweekly, they may or may not be due on that reporting cycle, but if they are due biweekly for three hundred dollars, we would want to see them on that report, even if they've already paid it, even if they're past due from other payments. We just want to know what does the contract say that the customer should pay in this seven day period. And the reason that's important, it just kind of lets us as a dealer to be able to say, my portfolio is X, it's supposed to produce this much money next week. So now we come in at the close of that week and say, how much do we actually collect, right? How much do we actually put in the bank and convert to dollars? And you can see that this number right here in blue, you can see on row seven right there, that it varies. So back to the numbers from the prior week ending the twenty first, they were projected to collect forty six nine eighty one. In fact, they collected forty eight fifty two net. So there's a calculation on the other screen I'll take you to in a minute that nets out large payments. After they did that math, they came in at eighty seven percent for the week. So on any given week, we might get a little excited about that and say, man, we've really collected poorly, right? And we might, you know, react accordingly. But the following week, they were projected to collect forty nine seven and they collected right at fifty two. So one hundred and four percent for that particular week. And this number that you see here is their ten week rolling average. And that's what I recommend. That's what I recommended for you. I'm sure, Nathan, because I've been suggesting that that for probably twenty years. And the reason is, yeah, I'm old. So the the idea here is that you you have you have history and it allows us because of using the same methodology, it lets us know what's a reasonable target. And this ninety three percent number that we're showing right here is is reasonable target. And I just want to pause for a minute, can think about. We're in the business of financing folks with credit trouble. They haven't shown that they manage money very well in the past. I think most people who knew that was the business that we were in would be surprised to see that across ten weeks, this buy here, pay here dealer who's financing folks with credit trouble is collecting ninety three percent of the money that they're contractually expected to collect. Don't you think? I mean, that's just even though this is a little disappointed because they used to be at ninety five. Ninety three percent of the money is still a pretty good number. But I think what this begins to identify is when we talk about that deficiency, it helps us really figure out. So what are the missing dollars for that seven percent in this case? So I think before I go into that, let me jump over here and show you the detail page and I'll need to zoom in on this one as well. But so what happens over here is we simply you can see down here in this section at row thirteen, this is where we subtract. the large payment. So this is where we're deducting unexpected payments is what I call them. You know, customers, Ken, back to our example, customers contractually do for three hundred dollars in a biweekly reporting cycle, but they have an accident. There's an insurance claim and there's a check comes in for sixty five hundred dollars. Well, it's a payment. It's on our payment report, but we don't want to include it in our collection efficiency because the whole aim of collection efficiency is to see how well are we doing collecting the payments that we expected to collect, right? And so that's why we filter that out. And so you end up with this net collection efficiency number. I know dealers who track collection efficiency, but a lot of them do it on a gross basis. And so they're running a hundred percent plus. And so I think it's more useful to take a moment to deduct those large payments. And now you end up then with that Jim, I got a couple of questions. So the first one is, so for those that may not understand, why the ten week rolling average? Why not eight week or twelve weeks? I'm glad you brought that up. It's because when you think about across a two-month period, you're going to have customers who pay biweekly, semi-monthly, monthly. Some of them might get a little behind. Some might pay a little bit ahead. But across a ten-week period, you're pretty much going to capture almost all cycles of biweeklies and semi-monthlies and monthlies, right? I mean, that's kind of how we landed on that years ago and just kind of stayed there. And so it just makes sure that we capture a broad enough range so that if there is a monthly customer who's past due and they need a month to catch up, then it should still reflect. So an example that I've given in the past is if you take it to a customer who's got a weekly payment that's due, then all of this and you start to when you think about this you start to identify the reason that this number is a little bit different you say it just for simple math let's say you have a customer who's got a hundred dollar weekly payment contractually due so every week as long as they're in the portfolio and active and haven't been charged off every week is going to show a hundred dollars from mary smith we'll call it well if mary's a little bit short in week one and so she can only pay forty dollars That means we're short, we're deficient for that week. But if she pays an extra twenty dollars for the next three weeks, then we're going to over collect for the next three weeks. And across that four week period, we would be at one hundred percent relative to Mary Smith's account. Right. So what that says is. This is why this becomes important is because it helps us identify then the collection team apparently did what we asked them to do. They work with people, they give them a little bit of time to get caught up as long as customers acting in good faith and providing the verification or doing whatever it is we ask them to do, then we cooperate with them. And so while that customer would still look okay on a delink or on a recency report, they're showing past due. They're going to inflate our delinquency. And if you have ten of those customers in that situation, our delinquency, you know, moves. Yet, We don't want to penalize the collection team for doing that if that's our approach. If we have a bend without breaking approach to collections and we do accept partial payments and we do cooperate with people, then it stands to reason that we're going to have some delinquency spikes. Right. And so I think the question becomes, how do we react to that? And I've met a lot of dealers over the years who really just look at delinquency. Right. And I think it's just it's problematic because it just doesn't tell the whole story, especially if we're trying to cooperate and work with people. It just takes a while to analyze. If you just try to get inside and do all the stuff that we just talked about to look at ten customers and figure out what status is, even though software is better now than it had been, it still takes some work to really drill in and find out what's going on with those and determine whether the collection team is doing their job. But I think once your collection team Let's talk about a collection supervisor, a manager of a collection department, or an individual collector themselves. When they look at these numbers, once they get familiar with the thing, especially when their pay plan is tied to it, I find that what it does is it promotes more proactive collecting instead of waiting until the customer's past due or heck, we don't catch them till Monday and they're three days past due instead of waiting until they're on a past due list. If we work from a list that says, these are the customers are contractually due on Tuesday. And let's say there are just five of them. When I come in on a Tuesday morning, these are the people. So I still have my past due list. Of course, I'm still working my past due list, but when I can start my day from these are the customers that are due today and Then maybe your practice is or your approach in your business is to reach out to them on the day that they're due. Maybe you don't reach out to them until four o'clock in the afternoon on the day that they're due. Whatever your practice is, but at least you know who they are. The reason that's important is if you see Joe Stevens pop up on the list, it's due Tuesday, say, oh man, I probably should reach out to him now because when I last talked to Joe Stevens, he was talking about a possible job change, right? So it's a reason for me to... work it before it's a problem. Customers are more likely to answer my phone call today than they will when they're six days late. So if I can reach out to them and talk to them now, then that helps me to work the accounts more proactively. And I find that when managers really settle into that and they understand this is kind of the thing, then it helps them to approach collections more proactively and to to kind of not get know that they're not going to beat up by the dealer supervisor. We obviously want to have supervisors and collectors and sometimes general managers all compensated on this sort of approach to collections whenever, you know, the thing is set up well in the system, but, or in the processes at the dealership, I should say, the idea here is once we all get on that same page, then we, we don't fear, being penalized for working with a customer, especially in today's environment, right, Nathan? I mean, it's tough for a lot of customers out there. And so if we just try to take an iron fist approach to get your payment in here by six o'clock on Friday or else, then I think most of us could expect to have a lot of repos on the lot come Monday. And so this is something that we really are trying to reemphasize and to make materials available so that folks can capture this. Now, I can tell you from my experience, and people speak up, if your system will do this, just be careful. Make sure you got the definition. If your software will produce a report that shows the customers that are contractually due in an upcoming period, I give you a list of all the customers and exactly what's due on their contract, irrespective of whether they're behind or paid ahead. I'm only aware of three software that will do that for us in the buyer sector now. One is IDMS. The other is, or the second one would be DealPack will do it. And I know DCS will do it. So if there are others out there that will do exactly the way that I described, please let me know. automaster will do it okay ams okay good okay so if then then what that affords dealers the opportunity especially if this can be auto scheduled so that it automatically spits out every sunday night for example based on the contracts that are active that's important and that's another reason we want to do it on a weekly interval is because we want to be working from fresh data we want to know that because if three accounts get charged off on friday we don't want them on the sunday night report right we want that that to be that moves over to our inactive portfolio and it won't be on this projected in the case of idms it's called a projected payment report or projected payment analysis report So I think this becomes really important to have that kind of data available. And the workbook that I prepared with a little help from ChatGPT, we took all this information and put it into a booklet that dealers can have. They can send a note to me, Jim, at White Hat Way. And we'll send them the little booklet that they can refer to. And if you're not on one of those DMS systems that I mentioned, then there's a method that you can use to use an average payment, update your average payment method period or your payment amount periodically. And it'll, it'll do the math. It'll get you close. We still prefer to have it contractually do. And I would love to have every DMS make this available for dealers for exactly this reason. But I think what happens is when you start to look at that, let's go ahead and drill into the thing about the seven percent. So. You know, as I was having this conversation with a dealer yesterday, I said, you know, so could this be the reason that that number is lower? And I said, yes. So I asked you to think about this. Like if we consistently run seven percent deficient, doesn't make it to the bank in the ten week period, then what would be the drivers on that? I've had fun in classrooms over the years, you know, speaking, talking about the subject, ask dealers in the room. And typically it takes a little bit. Somebody will say, well, what about just repos? And that's definitely one of them, okay? So customer Mary Smith was supposed to pay a hundred, supposed to pay a hundred, didn't, three, four weeks go on, we repossessed the car. But contractually speaking, every one of those weeks, she was in our active portfolio, she was expected to pay, she ultimately charged off, she repossessed, charged off. So whatever that window of time is, is that four weeks? Is it eight weeks? How long did we allow Mary to stay in our portfolio, not paying what I would come to call a non-performing account, How long did Mary stay in the portfolio in a non-performing status before we charge it off? Because even if the customer's out for repo, still active, still in this report, okay? Even if the customer has been repossessed but not yet charged off, still active, still expecting a payment, still would like to see a resolution. So it's still in our portfolio. So part of what happens here is I think from a balance sheet perspective, And the other reason I like this measurement is because it gives you, Nathan, as a dealer, some awareness around if my collection efficiency is falling off, I must have a number of contracts that are not performing. They're not paying as expected, which means I have a percentage of my portfolio that is Sometimes we call it dead wood. It's inflating our balance sheet because it's on our active portfolio report, but it's not performing. And so this is why we like to shorten that cycle as much as possible. That way we can own a bend without breaking, work with customers. And then once you get to the point where it has to be... the relationship has to end and we have to repossess and charge off. We just want to see that cycle be as short as possible. And part of the way we help that become short is just keeping in contact with customers and being proactive and not letting a delinquency problem drag out, Let's not let a repo management process drag out and have it take too long to cure. We just want to move through those and get them off of the balance sheet as quickly as possible. Because when you walk in on a Monday morning or the first of October, Nathan, we want you to be able to run a report that says this portfolio is pretty clean. This is your real performing assets for the most part. You're always going to have a few in there, right? When you see that number run from ninety three percent to eighty nine percent, it says, whoa, I got some contracts in there that aren't paying as expected. So I got to go identify that. And delinquency won't always tell the whole story. So I've shared one of the two drivers. And obviously the repossession charge off. Mary Smith was supposed to pay, supposed to pay and didn't. The other one is deferrals. And this is where we got to be watchful because when we talk about gaping holes where we're vulnerable as dealers, is when we authorize somebody on the team to defer payments, like contractually go into the software and actually move the payments. So every system calls it something different. I mean, I've heard them called due date changes or, you know, there's any number of things that you can do a full on modification amendment rewrite. Most people don't do a lot of that. But there are systems that afford the ability to just take a payment and push it out eight weeks or push it to the end of the contract. And if we grant people on our team the authority to do that, then this can drive the other piece. And I think this is the part. So now we would look at that and say, well, our delinquency looks fine. Our recency looks OK. Yet the money's not in the bank, apparently. Right? Because this is the part that we begin to identify is when we're deferring payments, it's like, yeah, the contract's still there, still active, and the account shows to be in good standing. Why? Because we deferred the payment, we pushed the payment back, but we would be feeling it here. Our bank deposits would be suffering. because this customer was supposed to pay and we agreed to defer. And so we can feel that in our bank deposit. This is why it becomes so important for us to identify, you know, this deficiency number and say, where, where is, so when I call it leakage, I'm just saying it's, it's really just non-performing assets. It's dead wood in our portfolio. Customer's not paying as expected. And so it becomes a problem in that way. So I think this is the part, and I'll, I'm gonna take this off the screen for just a minute. I'm having a little trouble running two screens, but if I've got the document that I can share that we worked up, the little booklet that we can walk through the particulars, but I think we covered most of the pieces that I really wanted to have a chance to express. So you can, I know a lot of this information was new to you, but I'd be interested in your perspective, your thoughts on what we presented there. You know, I guess what I'm just thinking about is, you know, one of the things is like you said, large payment that's taken out, right? Like, like how, you know, so, so what if someone makes a, what if a customer makes a large payment? Like they got, I don't know, like, you know, some kind of they sold some stuff and now they want to pay a thousand bucks, which doesn't happen normally. But how do you Does a dealer go in and include that into that? Or do they, does it take it? The number we use is a thousand dollars. That's what we were recommending dealers. And even though payments are a little higher than they were ten years ago, I think thousands still a good number. So it's going to allow when a customer has a four hundred fifty dollar payment, they were past due and they came in, they catch up this month to pay nine hundred dollars. We're fine. They're just catching up from payments in the past. It can stay in the mix. we're really just trying to identify those payments that are of a significant size so that customer sold something right in your example if they came in and paid three thousand dollars i would say we we're going to remove we're going to credit back i didn't show you in the math in there but we're going to credit back customer pays three thousand they were past due five hundred and they contractually were due for another three hundred in this window so we're going to credit that we're going to give credit for the eight hundred that was banked as expected But the extra money, we want to filter out because, again, we're just trying to measure how do we do relative to the money that we expected, right? Okay. So that's, that's what this whole thing is trying to measure. So we just want to filter out those large payments. So anything else on that? Yeah. I'm just, you know, the other thing I was thinking is, you know, let's say a dealer, cause you know, cause I've been talking to some dealers, you know, and you know, like I told Nathan, you know, one of our conversations that some of these dealers don't even know their numbers, right. You know, they're not even familiar with that. So what, what is the significance of, you know, let's say the ninety percent or ninety five percent like like what what's the significance of that for a dealer? Like why would they want to track that or why is that even important for them? Right. Well, I'll let Nathan answer that. He's been. So for a couple of reasons. Right. So the first is. I want to be able to know from week to week what my expected cash flow is going to be so that i can budget so i can go out and say yes i can make i can afford to make this repair this week or no i need to push that recon to next week uh i can afford to buy five cars this week no i can't i can only afford to buy three so it allows you to uh budget into the future that's probably the biggest the you know the second is And this kind of is evaluating the overall health of your portfolio. Like, if I keep growing and building this, right, and it keeps getting bigger and bigger and bigger, am I going to get, am I going to be able to add an employee six months down the road or not? Am I, can I expect that, because, you know, buy here, pay here things, things don't show themselves for several months, right? So you could think you're doing a great job and then it just, the deficiency in whatever policy or operational mistake you might make, which we all do, really compounds over time and you don't get to see that out into the future. So it allows you to plan not just this month or this week, but also If I'm going to grow my portfolio to three hundred accounts from one hundred accounts, what's that going to look like? And am I able to, you know, are our policies robust enough? Is our bend, don't break rules effective enough in bringing real money in to allow me to grow? And then, you know, you also will know, you know, it will impact repossessions. It will impact how your lending relationships are going to look. You know, can can I continue with this line of credit and grow that into the future, will I have enough cash coming in for the debt that I'm taking on if I continue to add to this line of credit? It's a planning tool. It's a policy tool. I looked at those numbers Jim put up and I'll tell you, you could see patterns in the numbers. You can see that last week of the month, That guy, three months in a row, was collecting over a hundred percent in the last week. So that does two things. Number one, am I going to sweat it this week if I'm at an eighty five percent? No, because the pattern is, you know, you got week one thirty two. OK, so if you look, there was a date on there. That was the last week of the month. okay it weekends eight thirty one so he collected a hundred seventeen percent right next week next week out of the gate he's at seventy nine right do i panic over the seventy nine well let's play it out okay seventy nine ninety three eighty seven all right last week of the month again we're at one oh five right so i think it it can you can spot trends you can also know like Oh gosh, I'm in the third week. I'm panicky. Do I have enough money to cover payroll? Cause that's coming this week. Oh, you know, probably not, not saying for certain, but probably not. I'm probably going to collect, you know, a hundred and five, a hundred and whatever percent of what I'm expected to. So it gives you the ability to really plan out your cashflow as you go from week to week, a month to month. Yeah. Yeah. It's perfect. Perfect. Nathan. Yeah. That's a, You know, several of the dealers that I've been working with, you know, the biggest struggle has been, you know, cash flow. Right. And you're exactly right. I mean, without these numbers, without this data, it's difficult to plan. And what's been happening with some of these dealers is that they're not looking at these numbers. And so they're overspending what's actually being collected, you know. And so and then they're wondering, I can't pay my payroll. What am I going to do? you know and so yeah perfect yeah it's true because this is a big chunk of the dollars and again there's money that you can go look on the other screen there are monies that come in beyond what we have here, because we're filtering out some dollars, they're not big. If you add them up, you know, across ten weeks, it's not big. But to Nathan's point, you know, if you're this dealer right here, you could look across the last six weeks or so, you know, and you can see you guys can't see the average there. I guess I can't even see it the way I've got this thing set up. But it's an average of forty six grand. across those weeks. So now a dealer can know with some degree of certainty, but a little bit above or a little bit below that. But you can know that that's about what we're collecting. And hopefully that number is growing. But we can we can say that, you know, if I collect ninety three percent, if I forecast ninety three percent off of this or whatever my projections are, then it gives me some certainty about planning to Nathan's point. And I love that part. I don't think about that part as much, but you're absolutely right. It does give you the ability to do that. And one thing, I opened this again because I wanted to quickly show everybody. These numbers in blue are the last week of each month. That's because it drives bonuses on the team. Okay, so that's how we've got it all set up. The ten-week average at the last week of each month. So, ninety-two point nine, ninety-three point three. For those not seeing the screen, I'm going back to the end of each month. Eighty-nine point eight, definitely was short that month. Ninety-one point three. Ninety two point six. Ninety three point nine. Ninety three point five. You get the idea. It's like it's pretty it's pretty consistently in that range. And so it gives a dealer some degree of confidence knowing where to be. And it also allows a dealer to sleep better at night when there's a little bit of a delinquency spike. To Nathan's point, right? It's like, you just know that, you know, it's if my team is doing what we've asked them to do. And the other thing I want to point out, I didn't say anything about it earlier, but if the goal is to collect ninety six percent, we can change that number on this calculation. But if the goal would be to collect ninety six percent, then that tells the team, hey, here's what we got to collect this week. If you want to get your bonus. you know, to, to ninety six percent. Here's what's got to be collected this particular week to get us back to that level. And so it's it's helpful in that way. And it helps help dealers and their team to start to differentiate, you know, between, you know, what's what's possible and, you know, what what what we can do there. But I'm going to stop share that. I'm going to just quickly give a rundown. We've covered most of the points. But I do want to share the the document that people can ask for. We've got that ready to release. And it's just going to take you through the high points in pretty good detail of just about what we covered here. And so I think it'll be useful for folks to be able to have an understanding what's here. It's instruction for both those systems that have the to have the software that will do the projection is what is it? Why does it matter? This whole two screen thing is just not working for me in our StreamYard platform. And then the step-by-step, you know, how to track it. Then number four, common causes of the inefficiency or deficiency. And then when software can't generate the schedules, how to solve that one. And then some best practices and kind of some quick reference for how it works and then some takeaways. So this is available. We can share this with dealers who want to step into this sort of methodology. But I would say... One of the reasons that we continue to come back to this particular approach is that this approach, you can see more than most anything else we do, would allow us to measure and even reward a team that is doing the job that Nathan described and that I have recommended, which is we're going to work with people. And they're not all going to pay every penny on time every time. And if we if we will monitor that on a longer range basis and recognize that the team is doing the job, are they getting the money in the bank? Yes or no. That's really yes or no. Are we getting the money in the bank? Because I feel like that's what this really measures is how well we're banking the dollars. And then it helps us know, OK, so which ones aren't we banking when we go back and look at that seven percent? Why are we missing that money? And so, you know, we want to cooperate with people, but you heard me say, when it comes time by policy to have to end the business relationship, whether that means repossession or whatever, then we need to just go ahead and charge it off. Same thing dealer asked me yesterday. Well, what about these accounts where, you know, it's wrecked and we're waiting on an insurance check? We could charge it off. I mean, the check's still going to come. You go create a system for somebody else. But as long as it sits there in the active portfolio, it's going to keep generating a contractually expected payment. And it's going to hurt your team's percentage because you've already decided not to pursue any more payments. You know, you could charge it off. And when the check comes, you apply it toward the charge off balance. So that's just practices, right? This is just, but the more we can shorten those practices, then I think what we're really, at the end of the day, as an advisor for dealers, I don't want to see dealers have an inflated balance sheet. I don't want you, because that can be dangerous. We can find ourselves in a position where suddenly we're charging off more than we realize. And if you're with a lender, it can cause borrowing-based problems that you weren't ready for. And so we just don't like to see dealers carrying that dead wood. And so this is because it can be problematic. And even if you don't have a line of credit, it's going to give you a false sense of where you're at. And that's not how we want to manage. So I I'm glad you guys could join last minute. I appreciate your, your questions and your, your input. I think this is, you know, really important stuff. And I'm, I think dealers just continue to kind of pay attention to that part and we can, you know, have a chance to, to, you know, just see kind of where it leads, but, but any closing thoughts from you, Nathan, before we wrap up? No, I, I'm, I think we've given everyone something to think about that I think is, you know, obviously I, I agree to it. I think it's helped me as I grow and plan and prepare and make decisions. Like I couldn't do it without it. That's how I, that's how I view. Good. Wow. Ken, what about you? Any thoughts, questions before we go? Yeah. You know, I'm just thinking, you know, to the dealer that's kind of struggling right now, you know, that, you know, this is, you know, looking at the deficiency is one way that you can really, you might not want to look at it, right? I mean, they don't, you know, dealer that's struggling don't, sometimes they don't want to see what the problem is because they're in that, you know, that fear mode. Like if they see it, they're like, oh man, you know, it really does, it really is bad. You know, and I'm just thinking about some of these dealers that have, you know, gone, you know, like got into trouble, like, you know, one, you know, like a large dealer recently that we've kind of been seeing all over Facebook. you know that's gotten into trouble you know and you know it's like like you know what is the dealer to do right when when he's seeing that there's a pattern of delinquencies you know you mean going down or like the percentage is going down right by tracking these numbers he you might be able to do something about that early on or like what you said you know it's possible that you know it could be a a covenant issue and and then do you know what do they do right yeah and that's obviously a major warning sign if if it's a covenant problem and they don't feel like they can charge it off then that that's a recipe for that's going to get bad and so yeah it's gonna get really bad yeah yeah call me and i'll call ken and we'll find out we'll figure out a way to help solve the problem yeah yeah no that's definitely yeah yeah no Yeah, yeah. No, I appreciate you guys making time to be part of the conversation today. I think we'll wind it down there. But we just always want to make sure we... We'll be able to chat for just a minute before you get back to your stuff. Stand by just a bit. Thank you.
