BOTTOM LINE NET PERFORMANCE CHART

$ AMOUNT PLACED:  The same amount ($800,000.00) is used to illustrate and compare different “bottom line” Client Nets.

$ DOLLARS COLLECTED: Monies collected by each agency will always differ according to performance.

RECOVERY RATIO %:  $ Dollars Collected/$ Amount Placed.  This is the most important factor when determining the bottom line net. $ Dollars Collected compared to $ Amount Placed defines “the Recovery Rate %.”

COLLECTION $ FEES:  Determined by applying the Agency Fee % (Column 5) to

$ Dollars Collected (Column 2).

FEE %:  This is the Fee % (Column 5) your agency charges against $ Dollars Collected (Column 2), which results in the actual Collection Fees shown in Column 4.

$ CLIENT NETS:  Bottom line after deducting Collection Fees from $ Dollars Collected.

MODEL COMPARISON OF AGENCIES PERFORMANCE BY
RECOVERY RATIOS, FEES AND CLIENT NETS
USING AN IDENTICAL AMOUNT PLACED

$ AMOUNT

   PLACED      

$ DOLLARS

COLLECTED

RECOVERY

RATIO %

 COLL

$ FEES

   FEE

    %

$ CLIENT

     NETS

  800,000

  264,000

    33%

  52,800

  20%

 211,800

  800,000

  248,000

    31%

  37,200

  15%

 210,800

  800,000

  400,000

    50%

100,000

  25%

 300,000

  800,000

  680,000

    85%

108,800

  16%

 571,200
           

CONCLUSIONS:  Each row above reflects different agencies’ performances relative to what is delivered to the all-important last column, which is what a CLIENT NETS.  The agency depicted in Row 1 charges a 30% higher fee (20% vs. 15%) than the agency in Row 2 and yet contributes more to the CLIENT NET because of the 2% higher Recovery Rate (33% vs. 31%).  Row 3 conceivably demonstrates the optimum results of a typical agency.  The last line (Row 4) is representative of results Williams & Williams, Inc. can achieve from timely placed delinquent balances.  Note the significant contribution to the “CLIENT NET” of $571,200.00 as compared to the other simulated agency “nets”. DOLLARS COLLECTED less the fee results in large NET increases. A collection fee represents 1/3 to 1/5 of the Amount Collected whereas the Net represents 2/3 to 4/5 of the Amount Collected. When an agency cannot collect then there is NO CONTRIBUTION TO THE “NET”.