Accounts Receivable Management

The U.S. accounts receivable management (ARM) industry has undergone a tremendous transformation since the start of the twentieth century. Initially, small collection agencies proliferated throughout the U.S. in the 1920s and 1930s. When creditors could not collect account balances on installment plans or retail accounts, these companies were hired on a contingency basis. During this time, debt collectors were either viewed as thugs who used intimidation to collect on debts, or mom-and-pop shops run out of a spare bedroom using an extra phone line.

By 1970, the modern U.S. credit industry was coming into its own. In turn, the amount of outstanding consumer credit grew sevenfold during the 1950s and 1960s, from $19 billion at the beginning of 1950 to $127 billion at the end of 1969. However, the trend toward a consumer credit economy led to the perhaps unexpected consequences of higher delinquency rates among consumers and the corresponding increased demand for debt collection services to address the issue.

As a result, Congress passed the Fair Debt Collection Practices Act of 1977, citing “abundant evidence of the use of abusive, deceptive, and unfair debt collection practices by many debt collectors.” The FDCPA would not only reshape the ARM industry for the better, but also convey government recognition of the important role debt collection plays in the U.S. credit economy.

Today, the ARM industry is an amalgamation of several market segments – debt collection, debt buying, collection law firms, and repossession services – that generated more than $14.5 billion in aggregate 2015 revenue and is projected to grow to more than $17 billion in annual revenue by 2020 at a compounded annual growth rate of more than 4 percent.

The industry is characterized by its sizable investments in advanced technological systems that support call-center and collection operations, and compliance divisions through voice and risk analytics software. As a result, the industry attracts interest among both strategic and financial buyers seeking economies of scale opportunities within a dynamic yet highly fragmented market.

While the ARM industry continues to evolve, Kaulkin Ginsberg is available to advise those ARM companies who are committed to maximizing their growth and exit objectives, as we have been since 1991.

As a result of the important role the ARM industry plays in the U.S. consumer credit economy, the industry will continue to evolve and attract interest from financial and strategic buyers. Kaulkin Ginsberg has served as a strategic consultant and transaction advisor to industry executives for decades, and prides itself on its knowledge and expertise the ARM industry.

We are excited about the potential within the ARM industry and look forward to working with owners and executives who are committed to achieving their growth and exit objectives.

If you are interested in receiving a copy of The Accounts Receivable Management Industry Overview, or would like to confidentially discuss your interests in the ARM industry, please contact a member of our strategic advisory team at hq@kaulkin.com.

 

 

 

 

LATEST BLOGS

Perception Metrics and Their Effect on the ARM Industry

May 25, 2017

While being able to quantitatively assess the health of the U.S. economy is great, most experts agree that other more qualitative factors are just as important. In fact, some experts believe that perception alone may be enough to influence the health of the economy since it directly relates to their spending and saving levels. ....

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A New Debt Milestone in Q1 2017 (But Not Really)

May 24, 2017

Some news outlets have started reporting that total consumer debt has finally surpassed its previous peak, which was during the Great Recession's height, and have even suggested that the newly released data might imply that we're on the verge on another downturn. However, these outlets are ignoring a number of important factors that suggest consumer debt levels and the potential for an economic downturn are not so dire....

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Semiannual Wealth Outlook: Collection Liquidation Results May Improve Amidst Positive Wage and Disposable Income Trends

May 18, 2017

When analyzing the economy and its interaction with the ARM industry, wealth-related economic metrics may be the most important indicator for growth. At its core, the economy is healthy when individuals, on average, are earning and spending more money, and economic livelihood is expanding, while the ARM industry is strongest when collection liquidation results are on the rise. As such, it makes sense that wealth metrics are the perfect tool for analyzing the strength of the economy and ARM industry....

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RECENT ANNOUNCEMENTS

ACA of Texas Publishes "Three Critical Healthcare Industry Trends for Outsourced Business Services" in its Winter 2017 Magazine

March 16, 2017

The ACA of Texas Publishes "Three Critical Healthcare Industry Trends for Outsourced Business Services" by Kaulkin Ginsberg in its Winter 2017 Magazine. Kaulkin Ginsberg details its belief that the growth in patient lending and financing programs, clinical integration networks, and physician quality reporting systems for the Centers for Medicare and Medicaid Services (CMS) could have profound effects on companies focused on servicing healthcare providers in 2017 and beyond.....

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ACA of Texas Publishes "M&A Trends in the U.S. ARM Industry" in its Winter 2017 Magazine

March 15, 2017

The ACA of Texas Publishe "M&A Trends in the U.S. ARM Industry" an article by Kaulkin Ginsberg in its Winter 2017 Magazine. This article examines the key trends and developments driving M&A activity in the U.S. ARM industry by market segment.....

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Mike Ginsberg Leading Panel Discussion at DBA International 20th Anniversary Conference

February 1, 2017

Mike Ginsberg, President and CEO of Kaulkin Ginsberg, will be speaking in a panel discussion on Trends in Debt Buying on Wednesday, February 8th at the DBA International 20th Anniversary Conference in Las Vegas, Nevada....

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