GUEST EDITORIAL
Recently there have been a few articles and even more posts regarding the Cap One decision to no longer allow agents to charge either the debtor or bill back money for redemptions or personal property related services. After reading those and then diving into the comments section I read exactly what I thought I would, absolute outrage from all service providers. The outrage although predictable, does not mean it is without merit, however what is truly missing are the actual numbers.
Let’s discuss the comments themselves first, they all seem to share their disdain for the decision and they assume that this was a hard hit to their business, (which very well may be) but are they sure? Not one of those commenters or articles put the actual numbers on display to demonstrate why there was an issue. Maybe there is a reason why, and it could be because they simply didn’t know how.
It just so happens that on June 30th my company’s fiscal year comes to an end, this allowed me to pull a full year’s worth of Cap One numbers to complete this formula on. Below are actual repo numbers for July 1, 2017 through June 30, 2018.
Total Cap One Repossessions: 188
Total Cap One Vehicle Redemptions: 20
Percentage of Vehicle Redemptions: 11%
Total Redemption Fees billed: $3,780.00
Proposed 10.00 fee applied to all repos: $1,880.00
Difference in collected fees: $1,900.00
As you can see with these figures the proposed fee of 10.00 is about half of what we collected during the same time frame. So, the same volume of work accounts for 1900.00 in lost revenue for my company. Now that is hard data that can be used with Cap One Vendor Management and can not be disputed. If everyone of you applied the same formula to your own numbers what would they tell you and then imagine how armed you would be when you speak to your vendor managers.
Cap One made a straight forward decision to eliminate the ability to charge this fee for the most likely reason of “compliance”. The never-ending umbrella that covers everything the bank does with regards to their customers and we as service providers must also follow. In exchange, Cap One offered 10.00 to be applied to all repossession regardless of redemption. That does mean that they realize there are costs associated and are acknowledging that with this.
This is only a negative policy if you want it to be. Cap One has demonstrated an attempt to make right by applying a fee to all repossessions, for my company the number they came up with on their own is not sufficient, now it is my job to inform them and then negotiate a better rate. A company cannot negotiate with emotion as its tool if you arm yourself with only the data you will always win! Know your numbers!!
Jeremy Cross
President /International Recovery Systems
Office 610-616-0263
Read More!
Know Your Numbers on the Cap One Fee Issue! – Guest Editorial – Repossess – Repossession – Repossession Agency – Fight for Fair Fees – Repo Blood – Now Available!
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