It’s not how you skin the rabbit, it’s how the rabbits fur grows back.

Well first of all I do not suggest you try to skin a rabbit thats alive so don’t send me letters. But there some meaning in this statement like many folk sayings across the US. If you are in the debt collection industry this relates to your business like this.

The biggest change in the debt collection industry over the last few years are the strategies used to collect the money. In the past the industry had 2 clear channels to get payments from, mail and phone so they sent letters and made phone calls. Well anyone in the industry today knows that letters do not collect near the numbers that did even 10 years ago and phone calls have so many compliance issues its hard to justify making that outbound call to a debtor.

So we have created more ways or channels for the consumer to pay. We have changed how we skin the rabbit because we need a sustainable business model. The debt collection industry has adopted self cure options to allow the rabbit to skin itself. So with a website that allows the consumer to go online 24/7 and pay their bill without any human interaction has allowed the consumer to skin themselves. And if we have done a good job they will continue to enjoy the experience of self skinning and will do it again and again. The self skinning allows the consumer to grow back the fur and then come back again for a trim without all the phone calls and letters.

So now if you want to be the most successful you can be you must perfect your self cure strategies so the consumer returns or so the consumer completes the transaction. Your payment site and all leading up that first consumer log in have to all be the best strategies possible these days as you may only get one chance to get this consumer to self cure.

Lighthouse Consulting created self cure and has the industry embrace it. If your interested in how to build a best rabbit self skinner in the industry you must talk to Lighthouse Consulting. Call Phil at 904-687-1687 now.

If there is an elephant in the room, I brought it

As a consultant to the debt collection industry I spend lots of time looking at other peoples businesses and telling them what they are doing wrong. Its quite a balancing act to tell a successful business owner how they have screwed up. It has always reminded me of the old statement about a elephant in the room and no one notices it. The problems in most businesses look so obvious to me I am wondering why they can’t see it of even if they do see it why they don’t fix it.

Well this is what drives my consulting business so I should be used to it now. So how do you see the elephant in your business? Try these 3 things to help you see the elephant in the room.

The restaurant business consists of 2 primary factors that will gauge the success of the concept, food and labor cost. The rent and the cost of utilities stay fairly steady but labor and food costs will fluctuate with the seasons and with the volume of customers. If you want to be successful you always keep a eye on these two areas to be successful in the restaurant business. Debt collections has similar key factors as well.

The first checkpoint is your cost per seat if your cost to do the business is high then all your unit yields have to be high and this is a hard thing to do these days with the low liquidity of most placements. If you want to explore how to calculate your cost per seat then give me a call.

Next is your unit yields or the actual dollar value you collect per account placed. In other words if you got 100 accounts that equaled $10K in face value and you collected $1000 in total then your unit yield would be $1000 divide by 100 accounts or $10 unit yield. So just like your cost per seat if your unit yields are too low then its another sign you have a problem. A good unit yield is $13 but some companies that work very lean and have lots of volume can make money with $8 unit yields. If you want more info on your unit yields call me at 904-687-1687.

And third KPI is the processes you are using. This is not a easy thing to measure like the cost per seat but it will highly effect your cost per seat and the unit yields. If you not using the best and most efficient process to collect the debt your wasting money and leaving money on the table both at the same time. My consulting services can help you get the most out of your business give me a call.

My Thoughts From The NARCA Conference

Well as always after a major conference I recap MY experiences and share them with you. Well the Spring 2017 edition started with a great reception on Wednesday night in Orlando Fl. The JW Marriott is a great hotel though it is quite pricey. It seems as most of the attendees were staying on the property which always makes for a better conference as the people you want to talk to are more available.

The bar was hopping when I arrived at 5PM on Wednesday straight from Montego Bay, Jamaica. I flew into the Orlando airport at 3:30Pm and was at the Marriott at 5PM ready for a drink. Thats when the high prices became apparent as my drink was $17. The bar was packed with NARCA attendees all talking loudly, well dressed and ready for the conference to officially begin at 6Pm with the Cocktail reception. As I looked around the room I realized that there were a lot of new lawyer looking people in attendance. New people in the debt collection industry in 2017 I ask myself, yes was my answer as most of the newbies looked to be young. Another glance and most of the old guard were also there but sitting and not so loud. I saw old friends and past clients like Sam Tuchman, Brian Williams, Richard Alpin, Ron Canter, Fred Daniels, Juan Andreau, Andy Hall and so many more.

So I began to mingle and listen to find out what everyones attitude was like, in past years it has ben about of doom and gloom. As I spoke to the old guard, the only ones I know, as I guess I’am the old guard also I learned that the attitude was upbeat. Client meetings which had started earlier in the day had went well and that can set the tone for the conference in many ways.

Next I headed to the Exhibitor hall and was impressed with its size and layout. About 50+ vendors were in attendance and though there were a few new vendors most were the old guard as well. My friends at Quantrax had bought me a badge so I first headed to meet with Mark and see the new booth. Quantrax had a nice location and the new booth was much better than the old one. I proceeded to view all the booths and nothing stood out it was payment providers, software vendors, asset location and process servers just like every NARCA Conference.

As the food and alcohol began to flow it was apparent that the quality of food was high, in fact much higher than the previous 5 or 6 NARCA events. I attribute most of this to the Conference location, the JW Marriott was expensive for a reason, it was really good. The food was noticed by everyone and most were making it dinner not just a snack. This was also good for networking as attendees stayed in the hall and mingled till the very end. I was exhausted after international travel and went back to my room for some well needed rest.

Day 2 started with Starbucks and lots of work to catch up for me. At 8AM the exhibit hall opened and breakfast was served, once again great food. So I got coffee and occupied a table and proceeded to do some work. As I did I listed to the attendees and booth personal around me and everyone was having a “good show”. The booths seemed to be getting great traffic except for the 5th row by the wall and the flow did not ever get to them. They did put the seafood on that side to create some flow but that side got much less traffic.

As the day progressed and I spoke with more and more people and saw the attitude was positive and there were no big topics as in recent conferences. The younger attendees seemed to be setting the mood and they are all hopeful and jolly. The old guard was still very guarded in their attitude and their conversations. They are hopeful as well but much less likely to say its getting better.

The attendees did seem interested in new technology as several were coming by the Quantrax booth and asking about the product. I was also talking with Missy and John at the Microbilt booth and saw many people looking for technology solutions there as well. Many people ask me about my new operations in Jamaica which was very good as it proves that my blogs are still very powerful and well read.

Overall I would say it was a “good show”.

Lighthouse Consulting Goes International

PRESS RELEASE June 1, 2017

Phillip W. Duff, President and Chief Executive Officer of Lighthouse Consulting, is pleased to announce the appointment of Karl Graham as Vice President of Caribbean Operations.

Mr. Graham has a long history of Call Center success in the United States and the Caribbean having worked in executive positions for major US Fortune 500 companies and also working in Jamaica for the last 10 years as Vice President to the Caribbean’s largest call center.

Mr. Graham will be tasked with managing call centers and creating partner relationships for the clients of Lighthouse Consulting. Mr. Phillip W. Duff the CEO of Lighthouse Consulting stated “As our clients are more and more using the options provided by Lighthouse Consulting we saw the need for quality management and I was able to convince Karl to come on board.”

Mr. Graham stated “The offer from Mr. Duff to help Lighthouse Consulting manage their seats in Jamaica and the rest of the Caribbean was one I did not have to consider very long. This is a great opportunity for me, Lighthouse Consulting, their clients and all the Caribbean people we will bring quality jobs to.”

Lighthouse Consulting would like to announce the opening of its new International offices in Jamaica, West Indies. In an effort to meet its client’s needs, Lighthouse has opened offices that will handle all Caribbean operations and allow Lighthouse to better serve its International clients. Business offices in both Kingston and Montego Bay, Jamaica have been recently opened. Lighthouse Consulting is helping International companies to reduce labor rates and increase levels liquidation. The initial interest has been from ARM companies, debt buyers and creditors but Lighthouse Consulting is also servicing first party clients.

Lighthouse Consulting provides near shore consulting and seat management for its clients looking for reduced labor costs. By managing the island labor as a value added service for its clients the ROI stays high and the clients stay satisfied. As profits get squeezed in the US near shore labor becomes a better option for many businesses but managing the process is a learning curve straightened by Lighthouse Consulting and it’s near shore operations.

Naked Is The Best Disguise For The Collection Industry

The collection industry has always had a bad reputation and in the beginning it was well deserved in my opinion. In one of my interviews I spoke with Harvey Vengroff about the early days here is an excerpt from that interview in 2013.

Next he told a story about work releases from the local jail and hiring thugs to collect the receivables, working off 3X5 cards and of hiring ranked boxers and former “FBI Most Wanted “as staff.  Harvey smiles as he remembers this period.  “As things change you adapt, it is not nearly as much fun now as it was then.   I was 21-22 years old and I had a bunch of tough guys working for me.  It was fun to hit people and get paid for it, now you have to do things according to a set of rules.”  He sighed after that statement as if the memory was fond to him.

Read the whole interview here  

Harvey was just being honest and now his company is well known for compliance. But now that the 1950’s is long behind the industry and its been over 40 years since the FDCPA was written whats the reputation of the industry look like today? Horrible! What are you doing to change that?

I think part of the problem is exactly that, we are not doing enough to create good press and deal with the bad press. I understand why, the press is consumer facing and they will always take the side of the masses. I have a close friend in the industry who did an interview for the press and tried to relay a clear message to the interviewer but when the article was published it was full of just the points that a consumer would want to hear or expect to hear, the message was gone. This is another reason we need to create positive press.

The answer is not to hide but come out and been seen. If we show ourselves as an industry like a naked person does in a nudest camp maybe we can also see our faults and opportunities to be more consumer centric. So how do we create positive press? It’s right in front of you, its all the consumers you deal with daily that are happy with your service but do not post a positive review because you did not ask them to.

Yes I am proposing that you ask debtors to post a review of your service. CRAZY HUH!

And you should also answer all the negative posts and try to mitigate the bad review or get it deleted. Yes I am saying contact the debtor and try to resolve the complaint. Even if that complaint was sent to www.pissedconsumer.com or www.ripoffreport.com or a site that does not require an answer, unlike the BBB or the CFPB. You need to address all complaints in real time on every complaint website on the web. Now your asking how the heck your going to do that, read on my friend.

Online reputation management is not new but it is new to debt collections, here is how it works. Lighthouse Consulting aggregates your good and bad consumer reviews from over 100 websites like Facebook, BBB, Twitter, Pissed Consumer and Google so your company can easily monitor what your customers are saying about you — in real-time!

You can hear every word stated about your business on Social media. Lighthouse Reputation Beacon is a service that automatically sends a review request to your company or the CEO’s cell phone, scoring new reviews for your business directly on Google and Facebook. Imagine a collection agency asking for consumer reviews, thats new! It will make your agency stand out.

Google your company right now, I’ll wait…… and if its indexed by google you’ll see google reviews which you can click on and see whats posted about your company. Most of you have never done this.

Lighthouse Reputation Beacon aggregates your reviews from top review sites. See what consumers are saying about your agency or law firm, in real-time.

With Lighthouse Reputation Beacon, your business can manage negative reviews with easy-to-use tools to address customer feedback quickly.  Your companies great reviews are collected from major sites are indexed by search engines for higher search ranking.

Price is so cheap you’ll say yes with little thought, call me 904-687-1687.

Watch a video here https://www.youtube.com/watch?v=soA49gtakZQ  or Contact Phillip W. Duff at phil@lighthouseconsultinginc.com for more info

Self pay healthcare accounts should be self pay collection accounts. Your how to guide to self cure.

As the world of collections changes and healthcare has taken over as the primary business line over credit cards the way we do collections has changed also. Self Pay healthcare is defined as “Selfpaying is a term used to describe someone who choose to pay for their treatment directly rather than using private health insurance. It is an option if you don’t want to pay a monthly premium, have a chronic or pre-existing condition or fall within an insurer’s list of exclusions.” Here is your 3 step guide to make those accounts “self cure”.

Self cure is defined by me as “communication channels that allow the consumer to pay or cure their debt online or by use of an IVR.” So how do we get the self pay patients to self cure? Here are three steps to drive payments to those self cure channels.

The first step is to get the technology in place. You will need a great payment site and an IVR tree. Not just any old technology, not the cheapest pay site either. You need the site to be very easy to use and to drive the consumer to make that payment now. This site must be easy to authenticate as well as easy to navigate. The site should collect opt ins and provide all the proper compliance. But most of all the site needs to drive the consumer to pay.

An IVR needs to be in place for the consumers who are less tech savvy or just prefer to use the phone. This system also needs to be easy to use and provide all the opt ins and compliance as well.

Step two is to drive the consumer to the technology. This can be done from several channels such as letters, phone calls, text messaging, emails and more. Just because you have the technology in place does not insure success as you must get the consumer to interact with the technology to get paid. How you use the channels to drive that interaction is very important. The message must be clear and the channel must be open and easy to navigate. This is where most companies fail. They think that just because they put the pay site URL on their letters thats all they need to do. Wrong! This is now direct marketing not debt collection, the message needs to be clear and friendly, like a Billy Mays ad for Oxi Clean.

The last step is to keep improving the channels and technology. In order to do this you will need lots more technology to track the current technology. Google Analytics will help but you will need to be able to attribute each online payment to a particular channel. Did Jane Doe pay her bill online because of the letter she received, the email, the voice mail drop or was it from your hold music at the 800 number after-hours?

As you can begin to see trends in consumer behaviors to your channels you can do some A/B testing with slightly different messages to see what is most effective.

So the conclusion is you need the best technology and the best channels to be the best at self cure. Since you have just one chance at this call an expert to help you get it set up. Lighthouse Consulting has worked with many companies to set up self cure programs, we know more about this subject and the technology that anyone. Give us a call to get some guidance when setting up or improving your self cure process.

Are you brainwashing your staff to fail?

As a consultant to the debt collection industry I get to see many different companies and law firms do this business and it amazes me just how many owners/managers are hindering their staffs growth. The limits of any group are created by the person at the top and often that person has created a ceiling that he/she cannot pierce. How do you break this cycle? ,

The problem lies in the fact that all your insecurities are displayed on your staff, 10 fold. They look up to you but they see that you have created boundaries for yourself and the company and just like they try to emulate your good points they also emulate your bad points, in spades. So here are three things you can do to break the ceiling.

First you must open your mind to everything. You create a ceiling so that you don’t get wet, so there is a feeling of comfort because you are staying in your comfort zone. If you go past that ceiling you will be in new space with unknown consequences. You have to be like Capt. James T. Kirk from Star Trek and “Boldly go where no man has gone before”.

You must find ways to open your mind to new ideas and then to not just discount them because they are outside of the ceiling and might get you wet. Your mind will play tricks on you unless you make efforts to change the way it controls you. You will need new ways to get ideas and vet them. I suggest using a consultant or industry expert to guide you until you have gotten used to getting wet.

The second thing you must do is express your newfound beliefs to the staff. You must find ways to change the perception that there is a ceiling and that those boundaries define the options. It may take a consultant to help you change that culture but once it is changed the company will be positioned to pass the ceiling.

A great resource for you to try new things will be your current staff, once they see that you have changed your tune they will begin to be creative themselves and will be able to see many more opportunities for improvement than they did underneath the ceiling. Now you must create opportunities for the staff to express their new found freedoms, set up workshops with he staff to explore and create those new ideas.

Try this, pick one person from each department (not the managers) and ask them to work together to answer this question. “If we had to do this job and 1/2 of the consumers were deaf and the other 1/2 were blind how would we have to change our processes?” This will force the team to think “outside the box” or “without a ceiling”. Its a simple exercise but you might be surprised in some of the ideas that actually make sense in the real world of consumer behavior. Hell, most of the consumers might as well be deaf and blind based on their behaviors, LOL.

Lastly you must not let it happen again. This is likely the hardest part as your natural impulse is to create that ceiling so that you feel comfortable. As you perform the exercises above you will remember why you are doing them and the intended purpose but when a new opportunity arises you will automatically create the ceiling and not even consider trey opportunity as possible. It will take time to see that the ceiling is the problem and to change your unconscious behavior.

I have made a living helping people like you overcome these ceilings, call me if you need guidance

Your clients reputation is at stake! How do you protect it?

Online reputation is everything today. No-one really ask live people for references any more they look at various sites online to see reviews and complaints. Ripoffreport.com and pissedconsumer.com as well as Google.com are the new reference providers to the web save consumer. The problem is when you as a collection provider get a complaint in most cases the original creditor is named in the content of the complaint. They may be complaining about what your agent did or did not do but the consumer relates it as ABC collections who is collecting my Oak Hospital bill. How do you protect your client as well as yourself? I’ll show you.

Online reputation management is not new but it is new to debt collections, here is how it works. Lighthouse Consulting aggregates your good and bad consumer reviews from over 100 websites like Facebook, BBB, Twitter, Pissed Consumer and Google so your company can easily monitor what your customers are saying about you — in real-time!

You can hear every word stated about your business on Social media. Lighthouse Reputation Beacon is a service that automatically sends a review request to your company or the CEO’s cell phone, scoring new reviews for your business directly on Google and Facebook. Imagine a collection agency asking for consumer reviews, thats new! It will make your agency stand out.

Google your company right now, I’ll wait…… and if its indexed by google you’ll see google reviews which you can click on and see whats posted about your company. Most of you have never done this.

Lighthouse Reputation Beacon aggregates your reviews from top review sites. See what consumers are saying about your agency or law firm, in real-time.

With Lighthouse Reputation Beacon, your business can manage negative reviews with easy-to-use tools to address customer feedback quickly.  Your companies great reviews are collected from major sites are indexed by search engines for higher search ranking.

Watch a video here https://youtu.be/KrUNnJLocUk or Contact Phillip W. Duff at phil@lighthouseconsultinginc.com for more info

Q: Why are you holding your company back? A: Its your limitations, the ones you set for yourself and your staff.

Where did you get these limitations from? 

Unfortunately you were taught these limitations by your bosses, the industry and your even your mentors. From the first day you entered the industry people told you what you can’t do or what was not allowed by regulations and seldom have they told you WHAT TO DO.

And there is a deeper layer here also, you have taught all the staff that work for you where the ceiling is. By your actions and reactions to suggestions and new ideas you have stifled the staff with your limitations. In fact you have ingrained them with all the same faults you have. If your successful you have likely done a great job at your brainwashing your staff to see the ceiling.

But aren’t boundaries a good thing? 

Yes but not ceilings. This is not a boundary issue its a issue that the decisions you are making are creating a ceiling that you cannot break through because you will not let yourself do so. You have created a false sense of well being knowing that you cannot pierce the ceiling and since you bump up against it often you must be doing a great job, but no.

Just because you are hitting the limitations you created for yourself and your staff does not mean anything but that. You have created and installed limitations that are hindering new ideas and strategies and its now a issue.

How do I break thru the ceiling? 

Find a better mentor. There are many ways to learn new behaviors but doing it with the help of an industry veteran that understands how to break through ceilings will be the best route. See you have to remember that you taught all the people that work for you where the ceiling is and they also believe they can’t pierce the top either. So changing the behavior of the company is a culture change that requires a professional.

How can someone else change the culture in my business? 

Professional consultants like myself have learned that culture change is what consulting is all about. Its not really about the changes in process or procedures its a change in the mindset of the company. I have told this story many times but my first consulting job in 2000 scared me to death, I was not sure if I was going to have better collection strategies than they were using. As it turned out the improvements were the easy part, they were staring me in the face, the idea of how to tell the owner that his business practices suck was the hard part.

I learned that day that culture change, from the CEO down is what consulting is all about. And it was about how to change the mentality of the company that made it work not the actual process and procedures that I suggested changing. The processes made the company more efficient and profitable but the change in culture was what made it grow and break through the ceilings it created for itself.

If you have created ceilings that are hindering you today give me a call.

Did the birth of the “consumer” and the death of the “debtor” kill the debt collection industry?

As the debt collection industry has tried to be more consumer friendly we changed our vocabulary from “debtor” to “consumer”. How has that also changed the industries mindset? Is it a good thing?

I think not.

It was hard for me to change my vocabulary a couple years ago but it was willingly I did so. As the market started using the word consumer over the word debtor it seemed appropriate. But the longer this has been in effect the more and more I see it affecting the mindset of collectors, managers and owners in a negative way. Consumer lawyers (maybe we should call them debtor lawyers) are why we changed our tune but I think we should have kept the word debtor, its not a bad word.

Somehow the word debtor became a bad word and I am not sure why?

Wikipedia defines a debtor as “If X borrowed money from his/her bank, X is the debtor and the bank is the creditor. If X puts money in the bank, X is the creditor and the bank is the debtor.” and defines a consumer as “The consumer is the one who pays to consume goods and services produced.”

If this is the definition to both words they are debtors not consumers, consumers “pay to consume”,

So why did a whole industry change its vocabulary?  

The truth is we did it from pressure we created on ourselves as an industry. We thought its would make us look more consumer friendly in the eyes of regulators, clients and potential clients. But was this a good thing? I think it has gotten too many collectors and even managers in a mid set that the debtor is right and the collection strategy is the bad factor.

The truth is that debt collection has been getting more and more consumer friendly since I began collecting in 1979. But it has gotten to a high point in 2016 in my opinion. Debt collection has changed to accommodate the consumers’ habits by moving to self-cure websites and IVR systems.

The birth of self-cure 

The birth of debtors curing their debt online with no human interaction is a positive result of the consumer mentality of debt collection. It has allowed agencies and law firms to reduce its compliance exposure and collection expenses by letting the debtor pay online. Most debtors do not really desire to talk to a debt collector when it comes time to pay they just want to make the transaction online. So the use of a payment site is the obvious answer and a best thing to come from the consumer friendly era created by consumer attorneys.

Now what? 

I think as an industry we need to remember that that are both debtors and consumers. Actually our job as an industry is to turn them from debtors into consumers. We have to treat them like consumers but remember that they are debtors till they pay the debt and they need to be handled like debtors.

The fact that our industry has made the effort to allow the debtors to self-cure by creating elaborate payment sites shows our ability to adapt to the consumer model but we still have to remember that most debtors need help to pay their obligations. They need financial counseling, just the push a call makes or they need a payment arrangement that the website cannot approve for them.

Lets remember they are debtors and need our help to pay their bills and become consumers.