Collection Agency Relations

1. Collection Agency Relations Creating WIN/WIN Relationships with Clients and Collection Agencies Randy Kamm The CBE Group, Inc. rakamm@cbegroup.com

2. The CBE Group, Inc.Defining the future of debt collection™ • Iowa-based collection firm currently employs nearly 1000 people celebrating 76th year of service • With more than 850 clients, CBE represents many of the nation’s most respected organizations in government, healthcare, utilities and telecom, financial services, and education • Corporate headquarters located in Waterloo, Iowa, with additional facilities in West Des Moines, IA; Overland Park, KS; and Atlanta, GA • Visit our website at www.cbegroup.com

3. Creating a Win/Win Relationshipfrom a collection agency perspective • What factors do PCAs consider when forming a client relationship? • Solid, clear and positive two-way communication of expectations and requirements • Sufficient volume/revenue to assure long term continuous investment in client satisfaction • Ability to employ best practices and cost effective administrative procedures that lower PCA operating costs and expenses • Each PCA is different – No two are the same • seek agency that best fits your size, scale, performance objectives & collection philosophy

4. Communicationis the key • Timely, clear and proactive communication • Two-way, positive communication based on win-win philosophy – not “we are the client, you do what we want or we'll find someone else” • Timely sharing of changes in assignment volume, procedures, reporting requirements, etc. • Regular and frequent communication channels • Permits PCA to make orderly adjustments in staffing, programming and other key resources

5. Portfolio StatisticsDuring the RFP Q&A Stage • Qualifying the opportunity • Monthly placement volumes (# and $) • First, second, third placements, legal • New forward flow vs. backlog • Work standards and current collection efforts • Average balance and age of accounts • Current contingency fee schedule • Historical liquidation rates • What is the formula? Batch, cumulative, annual, etc. • Does the prospective client fit the agency’s financial model?

6. Performance ModelIs it a good fit for the PCA? • Each PCA has its own ‘sweet spot’ where it excels • High volume/low balance • Low volume/high balance • High volume/high balance • Low volume/low balance • Consistent ‘forward flow’ of new business permits PCA to plan and continuously invest in performance on your behalf

7. ImplementationHit it or miss it • Getting off to a good start • Client and PCA have same understanding of the implementation process, key deliverables and implementation timeline • Get all affected departments ‘on board’ up front • Key support departments: Information Technology, Accounting, Audit and Compliance, Legal Counsel • Frequent stumbling blocks • Electronic interfaces and coordination, security standards, remittance process and procedures, standard administrative rules and procedures

8. Competition and Critical MassDoes the relationship make economic sense? • Does client employ well-defined and effective Performance Evaluation model? • What are goals, objectives and incentives • How many vendors are used and is the number of vendors appropriate for the volume of account assignments? • What is the right balance? • Is there sufficient volume of accounts for PCA to plan and invest in client’s business?

9. Other factors of importancethat make you attractive to a PCAs • Target Rate Pricing vs. low bid situation • Takes pricing out of evaluation and permits you to focus on PCA’s ability to perform • It’s true: You do get what you pay for • Ability to add collection costs, ‘convenience’ or transaction fees • Streamlined, paperless and cost effective reporting and remittance processing • EFT/ACH vs. Wire Transfer • Electronic vs. paper invoice/reporting

10. Thank You! Any Questions or Comments? Randy Kamm, Vice President The CBE Group, Inc. 513 478-2096 rakamm@cbegroup.com